Delivering the keynote address at the Indian Paint Association's annual VSKD Nadar Memorial Workshop on the paint industry, Tube Investments managing director A Vellayan said small paint industries should work towards consolidation and grow large to face the next challenge after liberalisation - the WTO. ``We ourselves will concentrate less on manufacturing aspects and focus more on design, brand building, logistics and distribution,'' he said.

This is part of the effort to survive beyond 2002, an era that would usher in free imports and minimal duty. A sum of Rs 8 crore is planned for brand building for cycles in the immediate future. According to Vellayan, TI Cycles could currently compete with many countries, but as things stand, would have problems with China, Taiwan and Spain and Portugal.

By strengthening its brand, tightening its distribution network, being innovative on design, cutting down on activities such as painting and plating, it hopes to be 10 per cent cheaper than landed costs of products from these countries.

``Many industries are making this move to face the WTO aftermath. Ford has already initiated this step in `outsourcing' painting and other two wheeler and cycle manufacturers were in agreement with this concept'' Vellayan said.

TI Cycles was facing some barriers from the French in exporting cycles. However, the company is hoping to settle the issue through amicable negotiations, rather than take up the matter with the dispute settlement mechanism of the WTO. It has currently received a large order from French major Decathlon for 70,000 sets of frames and forks . ``These are the two main items we make in the cycle, the other parts were being outsourced. We stand to gain more in real terms this way'' he said.