In an exclusive interview with Industry Outlook magazine Arjun Ranga, MD, Cycle Pure Agarbathi, shares his insights on how the incense market in India is growing at a steady pace and how family dynamics is a crucial tactic in shaping this market. He also outlines the challenges associated with supply chains when it comes to natural products. He began his career as a business analyst at Chemical Marketing Resources in Houston, USA. He is also the Chairman of CII – Karnataka State Council for 2022-23 and the current President of the All India Agarbathi Manufacturers Association (AIAMA).
What is your perspective on the current status of incense manufacturing in India? How do you observe industry players adapting to emerging trends within the sector?
The incense is a staple product of India. With the passing down of tradition being a common practice in the majority of the nation, it’s inevitable that a lot of cultural practices and rituals involving incense will also get passed down through the generations of new nuclear families. 85% of India uses agarbathi, which spans across all economic strata. Incense manufacturing has become highly localized, and numerous players cater to the requirements of the region. The primary trend that the industry needs to adapt to is the fragrance preference. The level of fragmentation and localization also poses a huge challenge for keeping up with the trends or anything the industry requires.
In what ways are automation and AI being incorporated into incense manufacturing processes to enhance efficiency, ensure quality control, and scale production?
Automation has recently gained traction with the packaging of incense sticks. The manufacturing of incense sticks is semi-mechanized, as there are a lot of natural materials that require human intervention, and later on, the process of extrusion happens through automation. The usage of AI is prevalent on the customer-facing side, identifying consumer patterns and buying behavior. It’s purely on the market side and not on the manufacturing side. Several companies are ISO certified, which are known for following strict protocols, the agarbathi industry is also the same, once the fundamentals are established, scaling is the next course of action.
What strategies are Indian incense manufacturers employing to expand their market presence and strategic partnerships?
The agarbathi is one of India's most exported commodities. It is available in 150 countries. The dominating factors for its desirability are the fragrance and the superior quality. Most companies typically look at international trade fairs as an essential opportunity to market their products, and with e-commerce being a key revenue stream, companies customize their packaging to the local region’s language and follow other statutory compliance requirements. Adhering to new consumer requirements is the most significant opportunity for the export markets.
How do quality standards and certifications such as ISO and GMP contribute to the competitiveness of incense manufacturers in export markets, and how do they build consumer trust?
Consumer trust comes from consistent quality and dependability. Agarbathi is used for fragrances. It shouldn’t be too strong or too mild. All these are critical aspects for a consumer to decide whether they’ll continue to use the product. Adhering to ISO standards and good manufacturing practices (GMP) is essential to secure the trust of customers who wish to continue to use your products, and it will also allow you to tap into newer markets without any barriers if one wishes to work with international companies, it becomes essential to have these standards followed at the time of audits. Competition in the external markets will be driven by uniqueness and innovation.
How do the factors of access to raw materials, minimal operational costs, and the emergence of low-smoke product variants contribute to the growth and competitiveness of the incense industry market?
Minimal operational cost is a myth when it comes to agarbathi manufacturing. For any industry to scale, production, manufacturing quality or packaging, there will be costs. Raw material procurement is also challenging aspect because several of them have to be sourced from forest territories, and integrating this process into the supply chain is also a challenge in itself.
Quality is something that can’t be delivered consistently with respect to natural commodities. This limitation will always exist. Whatever is derived from nature will be dependable, and sometimes, owing to weather conditions, the raw material may develop differently than it usually would. This would impact the final fragrance of the incense.
In the future Indian incense will continue to dominate the export market and domestic consumption will continue at the same rate. Premiumization will increase as people will continuously look for better products.
