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Stationery has historically meant a wide gamut of materials: paper and office supplies, writing implements, greeting cards, glue, pencil case etc. With the opening up of the economy, the top, and not only premium products, entered the market while high priced ones are being sold in small, unassuming way-side stores. One thinks of any global brand and it is here. These include designer and status symbol pens, be it Parker, Cross, Mont Blanc or Cartier.
The market for writing pens is estimated at 1600 to 2400 million pieces a year. By value, the total market for writing instruments is estimated at Rs 22 billion and is growing at around 8 to 9% annually. The informal sector's contribution to the market is placed at over Rs 6.6 billion or 30% of the total market by value and 65% by quantum. While by numbers the low-end market accounts for 90%, the premium and top-end segment accounts for less than a percent. The balance is accounted for by the moderately priced mid-priced products.
The global market in writing instruments is estimated at about USD 38 billion, of which global pen market accounts for nearly USD 30 bn. The Indian market size is relatively small. In terms of quality of pens, India ranks amongst the best in the world, well ahead of even China. However, India's export market is abysmally low at Rs 2 billion, while China exports Rs 50 billion worth of pens every year. Corporate gift segment in India is valued over a billion, growing at 15%.
The Indian market consists of around 15 large scale, 100 midsize and 900 small scale manufacturing units. These units have a combined production capacity of over 10 million pieces a day.
About 80% of the revenues of the pen industry in India comes from pens with a price range of upto Rs 15. A small percentage of pens is priced in the range of Rs 100 to Rs 300 and miniscule of the market is contributed by the super-premium segment in which the price tag goes to as high as Rs 100,000 or more. While the market for lower price range (up to Rs 15) is growing at a rate of 7 to 8% annually, the market for pens above that range is growing at 8 to 10%. The rate of growth of high priced writing instruments is much higher - basically because of a small base. There is, nevertheless, in the recent period, a price upgradation in evidence at the low-end. As the market is developing in the new ambience, the products are getting upgraded.
The market is segmented broadly into products required by (a) young students (many of whom depend only on pencils and ball point pens), (b) frequent users (in offices, commercial and public establishments), (c) occasional users (like housewives and literate manual workers). While India's literacy rate is low, all literates do not use ball or fountain pens, if at all, only occasionally. Obviously, the per person usage is limited mainly to (a) and (b) segments. The usage norms differ from function to function; even as it does from one person to another and certainly from one segment to another.
The students account for 55 to 60% of the off-take followed by executives at 20-25% and other multilevel users accounting for 15 to 20% of the market.
The existing scenario gives an indication that the market in being dominated by the ball point pens, which accounts for 70% of the total demand for pens in India, followed by gel pens (20%), fountain pens (4%). The rest accounts for only 6% of the market. A majority of users, 85%, use blue ink, while black, red and other colour inks are used by about 15%.
The major players in India include Luxor Writing Instruments, Cello, Reynolds, Add Pens, Goldmate, Today's Writing Products, Rotomac Pens, Stic Pens, Linc Pens & Plastics, GM Pens International, Flair Pen.
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