Arvind Limited ( Case Study)


Arvind Limited ( Case Study)

Amrit Layak

Department of Textile Technology

Government College of Engineering and Textile Technology, Serampore, India


BACKGROUND OF THE COMPANY:

Arvind Limited (formerly Arvind Mills) is a textile manufacturer and the flagship company of the Lalbhai Group. Its headquarters are in Naroda, Ahmedabad, Gujarat, India, and it has units at Santej(near kalol). The company manufactures cotton shirting, denims, knits and bottom weight (khaki) fabrics. It has also recently ventured into technical textiles when it started Advanced Materials Division in 2011. It is India's largest denim manufacturer. Sanjaybhai Lalbhai is the current Chairman and Managing Director of Arvind and Lalbhai Group. In the early 1980s, he led the 'Reno-vision' whereby the company brought denim into the domestic market, thus starting the jeans revolution in India. Today it retails its own brands like Flying Machine, Newport and Excalibur and licensed international brands like Arrow, Tommy Hilfiger, and Calvin Klein through its nationwide retail network. Arvind also runs three clothing and accessories retail chains, the Arvind Store, Unlimited and Megamart, which stocks company brands.


INTRODUCTION:

Textile industry is the second most polluting industry after the Chemical Industry. The concept and need for sustainability is the prime factor for this industry. The Water act 1974, The Water Cess Act 1977, 1981 Air Act, 1986 Environmental Protection act, The National Green Tribunal act 2010 mandated for a sustainable business model and Arvind is no exception. In 2019 a project SU.RE (Sustainable Resolution) which led the industries strongly in addition of prevailing laws to move towards sustainable fashion that contributes to a clean environment. The proverb, well begun is half done is apt when it comes to sustainability. Arvind believes that sustainability must be at the source and must be embedded in the production line to yield a value chain therefore it believes on six core inputs, and manage, enrich and getting the inputs "fundamentally right" and that truly makes the business model sustainably sound. Arvind's business model is not only confined to follow the prevailing regulation laws but also tend to set up a benchmark among the industries to reduce the use of natural resources as possible and to use an alternative which will not only be sustainable and environment friendly but also inculcates its mantra into its each and every product.


THE RISE OF ARVIND (A MANIFESTATION OF HOPES AND ASPIRATIONS):

  • The Beginning-1897:- At that time when there was hardly any manufacturing activity in India, Lalbhai Dalpatbhai set up his first mill, the Saraspur Manufacturing Company.
  • The Spirit of Swadeshi-1931:- In response to Mahatma Gandhi’s call for Swadeshi during the struggle for Indian Independence, the Lalbhai family founded Arvind Mills, creating a capacity to compete with the world’s finest textile mills.
  • Swadeshi goes Global-1935:- Arvind's butta voiles were being exported to Switzerland and United Kingdom (UK), thereby realizing the full potential of the spirit behind Swadeshi.
  • Textiles to dye for- 1952 :- After two decades of success in the textile industry, Arvind set up India’s first dye and chemical plant, under the aegis of Atul Products Ltd, in order to reduce the nation’s dependence on imported dyes, and chemicals.
  • Innovating the future-1973:- The Narottam Lalbhai Research centre was established to further the company's technical capabilities. The Centre was home to many path- breaking innovations in the years following its establishment.
  • Denims Takes Wing- 1980: - Flying Machine, India’s first denim apparel brand, was launched to meet the aspirations of the emerging youth segment.
  • Innovating the future-1985:Renovision, a new strategic plan for the Company, was introduced. It was to put Arvind and India on the global map of denim manufacturing. Just as India, a protected economy, was opening up to the world, Arvind had firmly shifted its focus on domestic to international markets.
  • India's first denim manufacturers-1986 :- Arvind’s – and India’s – first denim manufacturing plant was commissioned at Naroda Road, Ahmedabad. Arvind was soon to emerge as a global leader in denim production. By the end of 1987, Arvind also started manufacturing high-value cotton shirting.
  • Global Brands come knocking- 1993 :- Through tie-ups with V.F. Corporation (USA) and Cluett Peabody & Co. USA, for manufacturing and marketing, Arvind was able to offer high quality global apparel brands like Lee Jeans and Arrow Shirts to the Indian market.
  • CSR Focus of Arvind-1995:- To formalize its Corporate Social Responsibility (CSR) efforts, Arvind launched the ‘Strategic Help Alliance for Relief to Distressed Areas’ (SHARDA) Trust.
  • Development through a unique partnership - 1996:- As a part of its CSR efforts, a unique Private-People-Public partnership was launched with SHARDA Trust, the Ahmedabad Municipal Corporation and residents of the Sanjay Nagar slum coming together to transform this into a model of urban planning and low-cost housing.
  • The World class Santej facility gets commissioned -1998:- Santej shirting facility, with a capacity of 34 million metres, was commissioned this year. Over the next 20 years, Santej became globally recognized as the benchmark for sustainable practices in the textile industry.
  • The New Arvind-2008:- To accurately reflect the multi-faceted nature of the organization, the name of the Company was changed to Arvind Ltd. from Arvind Mills Ltd.
  • Expanding the international brand basket:- Beginning 2011, Arvind has brought in some of the biggest global fashion brands like Calvin Klein, Tommy Hilfiger, Gap, Ed Hardy, Hanes, Nautica and Elle to India
  • Better Cotton, Now in India -2011:- First Better Cotton Initiative (BCI) bale produced from India, from the Arvind farm project in Akola. BCI seeks to grow cotton responsibly by controlled application of water & use of approved fertilizers; thereby dramatically reducing the footprint of cotton farming. Arvind is one of the largest implementation partners of BCI in India.
  • Creyate-2014:- A brand created to fulfil everyone’s individualities. Creyate offers fine, bespoke menswear with a degree of customisation never seen before.
  • Khadi gets Reimagined: - With the birth of Khadi Denim, the legacy of Swadeshi, which had inspired the founding of Arvind, came full circle. Each single yard of Khadi Denim is spun, dyed and woven by artisans carrying on centuries-old handloom traditions. It is perhaps the most sustainable denim fabric ever made: no chemicals, no electricity, no high technology, no use of depletable resources.
  • E- Shopping- 2016:- Arvind launched Nnnow.com, a one-stop shopping destination for trendsetters across the country.
  • Made in Arvind-2017:- Building on an 86 year legacy of craftsmanship, innovation and fashion leadership, Arvind launches its own Ready-To-Wear brand.

SUSTAINABILITY (Economic and Environmental)

The objective is to enable 30,000+ employees, to translate the “Fundamentally Right” philosophy into practice in their day-to-day decisions across all six key inputs – Cotton, People, Money, Energy, Water, and Chemicals. In each of these areas, ARVIND has achieved significant advances. For example, Better Cotton initiatives are reducing the environmental impact of cotton cultivation.

  • Better Cotton Initiative - In tune of their sustainability philosophy "fundamentally right" which focuses on input management, Arvind spends a great deal of time and effort in reducing environmental impact on cotton cultivation. Arvind was the first textile major in India to partner with better cotton initiative that grows cotton by carefully controlled application of water and use of approved pesticides and fertilizers thus dramatically reducing the environmental footprints of cotton farming. Arvind highlights 52% increase in the numbers of BCI farmers between 2016-2014 to 2015-2016. It also highlights that 5 year comprehensive plan to drive BCI ahead and develop Organic Cotton seeds.
  • Workforce - Arvind believes that for any company the people are their important assets. Arvind focuses on talent management as three key areas - Continuous learning to improve occupational health and safety, Training and development & Industrial relations. Arvind highlights 8963 man days training given during the reporting period, 56% decrease in injuries between 2013-2014 and 2015-2016, Project NEEV (a comprehensive, competency-based standards for identifying employee potential and structuring career growth.
  • Economy - Arvind carefully invests in expansion of their capacities, nurturing their talent pool, advancing in technology, employment generation and giving back to the community and as well as environment. In the following year of 2013-2014 and 2015-2016 there has been an 8% increase in their revenue, 5% growth in profit before tax , 5% growth in operating EBITDA, and 51,947 million economic value distributed.
  • Energy  - Arvind's philosophy towards energy conservation is summed up to five words, "Ever Watt saved, is a Watt Earned". This approach enables multiple tangible benefits - improved energy security, reduced energy costs, enhanced productivity and lower emissions. Some highlights of the financial year 2014-2016 are - 60,400 kWh cumulative power saved in Bengaluru through daylight harvesting system, Over 3 million kWh saving through introduction of energy saving led lamps at Santej, first Indian company to get certification in the Composite Textile Industry-denim fabric category, 11.78% decrease in GHG emissions at Naroda.
  • Use of Water- Textile industry ranks among the top 10 water-consuming industires. Within the industry, the water footprints of natural fibre processing are higher than artificial fibres. Arvind highlights some of its data in the FY 2014-2016- 17.42% decrease in freshwater consumption at Naroda, 100% process water requirement sourced through treated municipal wastewater at Bangalore, 6.5 litre of water/ kg of knit fabric saved at Santej through one bath Biopolishing and Dyeing, 800kl/day of sewage water is treated and recycled at Ankur Textiles.
  • Chemical Management - The look and feel of clothes is obtained by the use of chemicals and dyes. In the interests of sustainability, it is important that the use of these chemicals is easily controlled, monitored, as far as possible reduced. Arvind highlights some of its key initiatives in chemical management which are- Creating and supplying of, “Skill kits" to each department to allow them to quickly manage hazardous chemical spills, Salt- Recovery through Zero liquid discharge system, manufacturing easy wash fabrics for reducing the use of detergent and chemicals at the consumer end.

CORPORATE SOCIAL RESPONSIBILITY (SOCIAL SUSTAINABILITY)

  • One of the fundamental values that are embedded into the very DNA of Arvind Limited is the belief that only in a healthy society can healthy businesses flourish and to ensure this, businesses must positively impact society.
  • The Founders were instrumental in setting up pioneering institutions for sustaining and improving Educational, Social, Cultural and Religious conditions in Ahmedabad – the primary center of the Company’s businesses. Ahmedabad Education Society, Indian Institute of Management – Ahmedabad, Center for Environmental Planning and Technology, H L College of Commerce and Lalbhai Dalpatbhai Institute of Indology are examples of some of the institutions they set up.
  • Thus, Arvind has been supporting initiatives of educational, social and cultural renewal much before the term ‘CSR’ – Corporate Social Responsibility – was coined. Arvind’s CSR activities so far have been carried out through SHARDA Trust and NLRDF working urban and rural settings respectively. Arvind Foundation – a recently set up section 8 company will now lead company’s CSR initiatives.
  • Arvind's energies are focused on four distinct development segments - Education, Empowering Tribal Women, Slum rehabilitation and Health
  • Education - is Arvind’s flagship educational programme under its Corporate Social Responsibility (CSR) initiatives. Gyanda literally means ‘Fountain of Knowledge’ What the programme attempts to do is to mentor children from the urban poor families, studying in municipal schools run by Ahmedabad Municipal Corporation, and provide them with supplementary education. The idea is to ensure that these children not only complete their education up to Class XII, but go on to graduate.
  • Empowering Tribal Women:- Arvind has initiated a unique residential programme to work and skill young women from the rural areas. These young women, all of them educated up to class XII, are chosen on the basis of their academic qualifications, dexterity test, aptitude test and health check-ups. Once selected, the company takes care of all their basic needs – housing, food, health and transport – as well helping them in pursuit of higher education. As a result of this unique design at the end of the four-year programme, a young woman could save up to Rs. 5 lakh, as well as pursue higher education and gain a degree/diploma –enough to give her a head start in life.
  • Slum Rehabilitation- The story of the Sanjay Nagar slum and its residents showcases Arvind’s long-term commitment to the betterment of the city of Ahmedabad and its people. In 1996, as a CSR project, Arvind envisioned the possibility of rehabilitating the slum dwellers of Sanjay Nagar to safer, better built and comfortable houses. And once the vision was in place, Arvind made it happen, by co-creating these homes in a unique three-way partnership between the people of Sanjay Nagar, the Ahmedabad Municipal Corporation and Arvind.
  • Health- Considering the lack of facilities for credible, affordable and quality primary healthcare in Ahmedabad, Arvind Limited has planned to establish Arvind Medical Centers in Association with Swasth India Foundation. Swasth India Foundation is a social enterprise working to provide quality healthcare for all and is Mumbai's largest non-governmental provider of primary healthcare and dental care.

CONCLUSION:

The Arvind Limited is Corporate group believing in "Fundamentally Right" as their mantra in this needed sustainable world. It is one of the leading brand in India with a revenue of 5,407 crores INR (US$760 million). For a company of this big business model and a focused campaign it is not feasible to make this business model a circular one overnight but they are always trying to become such. However their efforts and their sustainable approaches and quality of their products make them as one of the biggest and loved brands in India.

 

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