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Nitin Kothari, Managing Director of DSM India, "US and European Based companies in the Indian Composites Market: Lessons Learned"

This report is based on series of interviews with multi-nationals in India, who are exploring growth opportunities in the Indian composite market. This 29-page report is FREE; to receive complete report, please write to helpdesk@lucintel.com. Managing Director of DSM, India.

DSM Engineering Plastics which commenced operations in India in 1999 intends to set up an automotive centre to cater to the automotive industry requirements of new parts. In an exclusive interview with Editor, Lucintel, Venkat Rao, Managing Director of DSM India, Nitin Kothari shares his experience and future plans for India.

Q: What do U.S. and European companies need to know to do business in India?

Kothari: The foreign companies need to understand (1) the Government of India rules and regulations to start up business in India. (2) The local culture, like customer's habits and language, their expectations and negotiation style, service levels, payment behaviours needs to be understood. (3) Also important is to select the local team which fits the culture of the US / European companies.

Q: Tell us about the beginning of your involvement in India.

Kothari: We started our operations by buying in an existing business of Cenka Plastics.  We invested our sales and marketing resources (and built the team) to explain to the customers our application know-how and expertise in creating value for the customers. We improved the service levels by modernizing the hardware and set up a supply chain which covered the market for just in time deliveries. This value added approach helped to establish a market leadership position.

Q: How significant is the Indian market to your business today and in the future?

Kothari: The Indian market is an important one. Historically , the market was small but has been growing at a significant pace of 10 -15 %, where as we have been growing @ 30% year on year and have established a leadership position in last 10 years in the relevant Thermo plastics Engineering Plastics market. We see that this market will significantly grow-especially in key segments automotive, electrical and mobile computing.

Q: What are some of the key challenges faced by your company in India?

Kothari: Challenges that we faced were to educate the customer on "Added Value" based application knowledge sharing and not being a pure raw material supplier. Setting up the global standards manufacturing plant was also a challenge. Human resource management and keeping the highly educated manpower engaged, in light with the fact many other multinationals followed us to attract them is also a challenge.

Q: What key lessons can you share from your company's experience in India?

Kothari: Important lessons that we have learnt is to bring in the global expertise and knowledge to the customers and get oneself involved in the early phase of developments at the customer end. The global customers in India look for a strong global account management with same level of service and agreements as they are used to in US / Europe.

Q: How is doing business in India different from doing business in Europe or US.

Kothari: Once the local culture and regulations are understood, doing business in India is not very different than in US or Europe. However the customers expect a response time which is in hours and not days.

Q: How much growth have you seen in last 2-3 years from your Indian business?

Kothari: We have been growing @ 30 % year on year in last two- three years and expect to grow at the same pace. We see a renewed interest in metals to plastics conversion with customers which can fuel the growth.

Q: What are your future Plans?

Kothari: DSM Engineering Plastics is supplying about 25 parts in the bonnet components and transmission parts for the Tata Nano car and is looking at setting up an automotive centre to cater to the automotive industry requirements of new parts.

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