Sunday, October 4, 2009

We have recently installed our 4th unit in Andhra. Upto now we have been in the fortunate position of demand exceeding supply, but we don't know how far this will continue. Until new units reach a monthly production of around 1500 metres of cloth per month, their running costs exceed their incomes. The first unit took several years to reach this stage, the second and third will take about 2 years, and the third possibly only a year.We bridge the gap with the margins on the cloth that we sell, which makes our cash-flow extremely tight! Most of our customers are exemplary in settling their bills immediately, some even pay in advance, and this is what keeps us going. We're learning the hard way that successful marketing is not just a matter of sales but also of managing cash flow.

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