Global engineering equipment is a massive $1.7 tn industry, divided into heavy and light engineering equipment. China is currently a major exporter of engineering products to the world and machines actually make up 43% of their total product exports. However, given the rising geopolitical tensions, there is a significant desire amongst global corporations to modify their supply chains and most companies are looking for alternatives to Chinese suppliers to de-risk their operations.
Global engineering equipment is a massive $1.7 tn industry, divided into heavy and light engineering equipment. China is currently a major exporter of engineering products to the world and machines actually make up 43% of their total product exports. However, given the rising geopolitical tensions, there is a significant desire amongst global corporations to modify their supply chains and most companies are looking for alternatives to Chinese suppliers to de-risk their operations.
Light engineering goods is a great target category with approximately a $500 bn market globally and one where India should have a significant advantage. Unlike heavy engineering goods, which require high end fabrication, significant capital and specialized component assembly, the light engineering category mainly needs low tech fabrication with high manpower requirements and standard component assembly. Further, it is dominated by SMEs (unlike for heavy engineering equipment) and in fact, in China SMEs contribute 68% to engineering product exports.
On the back of a wave of import substitution in India in the last 2 decades, Indian light engineering products have achieved technical parity with globally renowned manufacturers and are worthy alternatives to even those manufactured in western markets. Further, owing to lower costs of manpower, Indian SMEs in the category are cost competitive relative to other Asian manufacturers as well. Despite all of this, India’s light engineering exports to developed markets in 2021 stood at only $1.8bn across 3 categories, material handling equipment, electrical & electronic panels and process equipment & peripherals.
SMEs in India have struggled to capture the opportunity due to demand and supply side challenges. On the supply side, sellers have limited global exposure, lack resources to build international distribution channels and are apprehensive to explore the export market, given their comfort with easily accessible domestic demand (on the back of import substitution undertaken in India). Demand side challenges include concerns around quality from global customers, longer lead times, difficult supplier discovery & reliability, poor service with long TATs and questionable after sales support.
Wootz.work aims to solve these problems and enable Indian SMEs to supply light engineering equipment worldwide. It wants to provide Indian manufacturers with access to global customers and western buyers with an easy and reliable supply channel in India. Wootz is aiming to do this by utilizing technology throughout the transaction and also by being responsible for the entire process from design till product delivery to customer.
Besides technology, Wootz provides non-manufacturing support to suppliers and a critical service layer & seamless experience to support customers, something which Indian SMEs have always struggled with.
Wootz is founded by highly complementary founders, Karan and Himanshu, who bring together extremely relevant and varied experiences to build and win in such a market. Their prior experiences include setting up manufacturing units, exporting engineering goods, as well as investment banking, business development and strategy. We are extremely excited to partner with them in this journey and are looking forward to Wootz placing India on the global manufacturing map!
