Towel makers high, not dry

Next time you visit a Walmart or JC Penny retail store in the US, don't be surprised if you see the label, "100% natural towel, Made in India".

For, Indian terry towel manufacturers, after winning friends and influencing customers in that country, are now aiming at expanding their market with new patented terry towels.

Welspun India Limited, India's biggest terry towel manufacturer, is taking a lead in this area and the flagship company of the Rs 2,000 crore Welspun Group has filed applications with regulatory bodies in the US for patenting the technology and even the designs of its towel, presently manufactured in Vapi, Gujarat.

While Welspun has already filed a couple of patents and is looking for more in the coming months, Abhishek Industries Limited, which belongs to the Ludhiana-based Trident Group, is also planning to get its products patented.

The rush to protect textile products driven by two reasons: Competition is clearly hotting up in the terry towel market even as the quota-free regime is only 10 days away.

Companies have come up with some unique products, including towels made of filaments of bamboo, hollow yarns used for towel manufacturing for higher absorbing capacities. Designers working for the leading Indian towel manufacturers are making fast buck, too, as design patents are also being applied for to maintain exclusivity.

"As terry towel has no longer been considered as a utility only but also fast becoming a luxurious commodity which even can be called a possession for customers in the US and Europe, we are now onto something called patented technology towels and in Welspun the process has already begun," Swapan Nath, director, Welspun, told Business Standard.

He added: "We have filed patent applications with the US autorities and they are under consideration now while further R&D is being carried out to meet the increasing demand from overseas."

Welspun expects to earn revenues of Rs 400 crore from its terry towel business by the end of this financial year in which 92 per cent of the income would come from exports. While 65 percent of its export revenue comes from the US market, 22-25 per cent comes from European countries, including the UK, Germany, France, Austria and Poland, now the company is looking at the emerging market in Australia.

Designers are commanding a premium. Welspun has hired an American designer who is mainly looking at demand from US customers.

"Innovation will be the key to woo these markets which have high potential, while quality control is another important factor. Overseas customers are increasingly looking for natural commodities and so we are trying to patent a towel which will not use any kind of chemical," said Nath.

A spokesperson of Avishek Industries, said, "To maintain exclusivity of our products, specially in the overseas markets like USA, there is a need to patent the technology used for manufacturing the towels while patenting designs of the towels which nowadays are not only used as bath towels or hand towels but also to decorate rooms, earning importance. We are looking at this new segment."

While Nath denied to divulge further information about technologies used for unique towels and towels under patent applications for business reasons, Avishek Industries' official also did not share much details for the same reason.

Saying that towels are now considered more as a fashion product than commodity, Nath said, "We are also launching towels made of hollow yarn, which is specialised kind of yarn to give towels more capacity to absorb water and yarn is developed in-house by Welspun through its group company, Glofame Cotspin Industries Limited having its facility also at Vapi."