German cleaning major Karcher to capitalise on India Covid demand

Global leader in cleaning solutions, Karcher group, Germany, is planning to capitalise on the Covid triggered demand for industrial and consumer cleaning technologies to expand its presence in India. The company is also looking at India as a possible production base to reduce the supply chain risks posed by Covid pandemic and geopolitical developments. Sensing a big opportunity, Karcher also brought India operations under the direct control of German headquarters, instead of managing it as part of its Asia-Pacific regional operations.

“With the size of population, India is actually a continent,” says Axel Stolz, executive vice-president (export regions) Karcher Cleaning Systems Pvt Ltd. “We have ambitious plans to increase our investments here. As the business develops, more hiring will happen. We also have plans to have low cost production in India because of the size of the domestic market, and also as a response to the geopolitical situation. Europe is very much dependent on China (for supply chain) and we are realizing how dangerous such dependency can be”, Stolz said.

Karcher already has a joint venture manufacturing partnership in Coimbatore, Tamil Nadu. Arma Products India Private Limited produces customised floor cleaning scrubber drier machines for Karcher. There are some exports too from this facility. Stolz said the company is exploring the possibility of expanding its local production through its existing JV and also new partnerships.

Of Karcher’s 3,000 plus global product portfolio, about 250 products across industrial and consumer categories are available in India. Right from mechanised broom and mechanised mopping or steam cleaning devices for home use to high suction power industrial vacuums, municipal machines for cleaning public areas, washing bays for cleaning cars and commercial vehicles, Karcher almost caters to every cleaning demand – industrial as well as consumer.

The professional machines and solutions for facility management and hospitality businesses is another major business segment that Karcher caters to. The company now has plans to develop more products in the clean water and air space as well as disinfectant and hygiene solutions.

“Prime Minister Modi has driven the concept of ‘Swatch Bharat’. We say mechanised cleaning can make cleaning even better. A lot of government buying is happening because of the cleanliness drive. This market, where the size of the industrial segment alone is about ₹600 crore, can grow 25% year on year. With India being such a big market, everyone will grow. The key is to position oneself and have a strong service team. We have roughly around 300 people and 14 offices all over India. We are in the premium segment,” Jatinder Kaul, managing director, Karcher India said.

“The biggest market potential for cleaning solutions lies in the retail or consumer products segment. With a population of 1.4 billion, even if 20% of the population buys one product, it will be a big number for all the players active in the domain. On a conservative level, we take the market (for consumer cleaning products like vacuum cleaners) to be another ₹550-600 crore, growing at around 15%, annually”, Kaul adds.

The privately held Karcher is a Euro 3 billion group, with presence in 78 countries. The company has recorded around 15% growth amidst the Covid-19 disruptions that have jolted businesses worldwide.