Illuminate the Business by LED

Join the revolution of lighting industry, an untapped industry of ` 2000cr. Growing at an exponential rate of
more than 50% per annum.
Kunwar Imran Khan

Lighting

industry

is

passing

through
a
great
revolution
throughout the world. There are
several reasons for that but in case
of India, conservation of energy
considered as the main reason for
adopting the changes.
Technological
advancement
is
playing a crucial role and it has
become base of the revolution.
During the earlier years of last
decade an evolution came that was
the replacement of traditional light
sources (e.g. incandescent light
bulb)
with
CFL
(Compact
fluorescent lamp). CFLs were a
good replacement of traditional
light sources because it consumes
about one fifth energy and gives a
better and white illumination than
the traditional light source. There
are lots of limitations associated
with CFL some of these are: first,
Cost of CFL is very high. An 18 W
CFL is a good replacement of 100 W
incandescent light bulb but its cost
is 15 times of the cost of a 100 W
bulb. Second, Life time of CFL is
very low. Average life time of the
CFL is 1-2 years. Third, illumination
of CFL decreases with its age.
Current evolution in the lighting
sources
is
replacement
of
traditional light sources and CFL
with LED lights. LED lights are the
array of many individual LEDs
mounted on PCB (Printed Circuit
board). LED is a semiconductor
device that emits light as the
voltage is applied to its terminals.
LED can emit light of visible range
(i.e. light of different colours) and
invisible range (i.e. infrared light);
these
are
bring into play

according to the applications. In a

very short time LED lights will
become a dominant light source
because of its ample range of
advantages. First, it consumes about
th energy of CFL for similar
illumination. Second, LEDs can give
light for 50,000 hours with same
brightness and illumination that is
equivalent to a time period of 15
years. Third, LEDs are more eco
friendly, these release negligible
Green House Gases (GHG), many
more advantages are there of LED
lights.
India is a developing country and it
has lesser production of energy
(electricity) than the requirements.
This shortage is growing as the time
is being passed. The government is
developing more and more power
plants to meet the demand of
electricity. This Demand can be
reduced by using LED lights up to a
very great extent so government is
promoting to use LED lights for
better conservation of electricity.
Save energy for benefit of self and
nation Slogan of Bureau of Energy
Efficiency (BEE). Different subsidy
schemes are given by government
for the promotion of energy
conservation.
Government
is
planning to introduce some laws

and acts under which it will be

mandatory
to
adopt
such
techniques of energy conservation
for getting approval for building
new apartments, villas, offices and
complexes.
Due to all these
reasons, LED lighting industry is
growing at an exponential rate. The
growth rate of LED lighting industry
is more than 50 percent per annum.
At the mid of 10s it will become an
industry of ` 2000 Cr.
Business opportunities:
As we have seen the demand of LED
lights is increasing exponentially.
This fact is giving opportunity in the
business
of
LED
light
manufacturing. Presently in India
there are very less manufacturer of
LED lights. LED lights are giving
more than 100% yield on the cost of
production.

Fig 1 | LED Lights in Audi Car

Fig 2 | Historical and predicted efficacy of Light sources

Prerequisites for manufacturer

of LED lights:
To become a manufacturer of LED
lights there are very less
prerequisites, reason being the
concept of LED light is quite simple.
A LED light comprise of the
following components:
1. LEDs: The most important and
crucial component of LED lights.
India rarely has any manufacturer
of LEDs, but thousands of models of
LEDs are available internationally,
select the models and import.
2. LED Driver: LED is a
semiconductor diode that emits
light and it is controlled by LED
Driver. Big international players of
semiconductor devices industry are
producing numbers of integrated
circuits (ICs) for LED controller. So
it is very easy to make LED Driver
by mounting these ICs, transformer
and some other small electronic
components on PCB.
3. Housing and Fixtures: Housing
and fixtures manufacturers are
available in every big city of India.
Even plastic toy makers can make
housing and fixtures for LED light
as per requirement. At initial level it
is good to get the Housing and
Fixtures from outside but later on it
can be manufactured by own.
4. Heat Sink: Heat sinks are used
with power LEDs. Heat sink is made
up by coalescing aluminium sheet

and PCB, an insulator separates

aluminium sheet and PCB.
Production factors:
LED Light manufacturing requires
very less production factor. A small
workshop of 500 Square meters
area can be sufficient to produce
thousands of LED Lights per hour.
It requires semi skilled labour; even
unskilled labour can be prepared
for production in a few days of
training. It requires less capital
investment than other industry
because of the following reasons:
a. Fix Cost: fix cost (excluding land)
is negligible for manufacturing LED
lights because it doesnt requires
any expensive and complex
machineries.
b. Variable cost: variable cost is
the main ingredient of cost of
production of LED lights. That gives
a very good yield when it is sold in
the market.
Marketing:
Marketing will play a very
important role in earning good
profit by LED light manufacturing.
Following marketing strategies can
be favourable in LED light
manufacturing business.
1. Product: volume does matter, it
a perfect market strategy regarding
products. The manufacturer should
offer variety of product for different
lighting solution that can be applied
to offices, houses, street lights, LED

torch, LED lights for solar system,

LED lights for automobile industry
etc. Even now a days LED lights are
being used in refrigerators and
microwave ovens. Products should
be available in different power
options like 1-3W, 4-7W, 10-15W,
20-60W etc.
2. Price: there is a very great
margin for profit; selling prices are
generally set more than 200% of
cost of production. Prices should be
competitive to the market with
better quality.
3. Marketing Channel: Proper
marketing channels will leads to
give better selling. Good relations
with distributer, dealer and seller
will result to capture large market
share.
4. Promotion: Government is
promoting about the energy
conservation including LED lights.
So it will be easier to capture mind
space of the consumer by the
manufacturing company.
5. People: LED lights have a great
life (up to 15 years). Give more than
5 year replacement guarantee.
These products are recyclable so
there is no loss in providing
replacement guarantee. It will
increase customer faith and loyalty.
6. First mover advantage:
Presently there is such big player as
such in LED light market; a new
company with good promotion
strategy can take the advantage of
first mover (FMA).

Fig 3 | LED lights products