Rubber manufacturing Industry in India

Best Practices to run a rubber manufacturing company:

1. Educate Yourself on Emerging Technologies-There have been many recent breakthroughs with new technologies, specifically in areas such as robotics and additive manufacturing. These advancements are enabling technology to become more affordable and accessible to small and mid-sized domestic manufacturers. Stay abreast of emerging technology trends like these and how they might impact your business.

2. Get Certified- Obtaining internationally recognized certifications and embracing quality management systems can help you become more marketable to suppliers and customers. Following industry standards shows your commitment to quality, efficiency, and customer satisfaction. New ISO updates have been of particular interest to manufacturers of late.

Challenges and Solutions: Rubber manufacturers can face unique challenges that are not faced by other discrete manufacturers. Rubber manufacturers are facing high demand for their products and is one of the largest sectors for manufacturing.

1. Economic Restructuring- Raw material prices in the synthetic rubber industry tend to climb when oil prices are high. Since the U.S. relies heavily on synthetic rubber, American manufacturers may be subject to increasing expenses due to higher energy costs, particularly in the tire industry. Similarly, raw natural rubber may become more expensive due to changing environmental conditions or from a shortage of synthetic rubber supplies. When coupled with a general slowdown in consumer demand or production rates, these factors can cause dropping stock prices and mounting debt.

Solution- During periods of uncertainty in the rubber market, many companies develop strategies to stimulate growth, expansion, or to preserve their market share. Some common practices used by manufacturers involved in the rubber business include:

• Shifting focus to international trade: With emerging markets in Asia and Latin America, some major companies attempt to offset domestic losses by staking capital on foreign investments. These investments can be used to modernize and expand existing plants abroad, or to increase production rates in regions where demand for rubber products continues to grow. Much of the current growth is driven by expanding automotive industries in countries like China and India, and several tire manufacturers have responded to this increasing consumption by developing operations in international markets.
• Corporate restructuring: Some companies see beneficial results from streamlining or scaling back their operations. Reorganizing the business model may involve workforce reductions, changes in management, or the elimination of non-essential practices. These measures are intended to offset costs and improve a company’s open market valuation by maximizing its revenue.
• Changing production methods or materials: If a particular type of raw rubber material has become prohibitively expensive to process, it may be useful to shift resources toward a different type of rubber that is more cost-effective to obtain. Also, reducing travel time for components between manufacturing stages and introducing dedicated assembly-specific cells into a machining operation can increase production efficiency.

2. Threat from China- Due to the US-China tariff war, Indian rubber manufacturing industry has already started feeling the adverse impact. Low cost imports have increased.

Solution- Increasing import duty may provide relief. It will slow down imports and encourage more capacity addition. Levying anti dumping duty towards China will also help the industry grow.