The Indian construction industry is experiencing a boom, driven by the soaring demand for housing and infrastructure development. However, this growth comes with its challenges, particularly concerning the consumption and pricing patterns of construction materials. Rising material costs, supply chain disruptions, and inflation are affecting the prices of construction materials, which account for a significant portion of total construction costs. Despite these price increases, consumers remain uncompromising in their expectations for high-quality materials. In response to the changing landscape, the construction industry is increasingly embracing digital technologies to streamline processes, enhance customer experiences, and drive efficiency. Ashish Aggarwal, CEO of ACube Venture, sheds light on the current state of the real estate industry and how digitization will be the driving force in the coming years.
Impact on Consumption and Pricing Patterns of Construction Materials
In 2023, the real estate market dynamics have shifted significantly. The unprecedented demand for housing has led to a surge in construction activities, raising the need for construction materials. As a result, developers are faced with the challenge of increasing prices due to rising material costs, which constitute a substantial portion of the total construction expenses. Global supply chain disruptions and supply-side shocks have further compounded the situation, causing inflation and escalating raw material prices. Despite these cost challenges, consumers are unwilling to compromise on the quality of materials used, which can have implications for the rapidly expanding real estate market.
Digitization and Handpicking Elements of Dream Houses
The evolving preferences of consumers have driven the need for personalization and customization in their dream homes. This trend has been facilitated by digitization, allowing customers to handpick each element of their dream house.
While this approach empowers customers to have more control over the look and feel of their homes, it can also slow down the procurement process. However, digital patterns of buying materials online have emerged as a solution to streamline this process. Through online platforms, customers can easily select their preferences from a wide range of raw material types, grades, and prices, making the procurement process quicker and more efficient.
The Rising Digitization in the Real Estate Industry
The real estate industry has recognized the necessity for digital transformation to cope with global supply chain disruptions, increased competition, and labor shortages. Embracing a range of new technologies has become a crucial aspect of modern construction practices. Virtual design and visualization, VR home tours, cloud-based software, smart contracts, and big data algorithms have revolutionized the real estate process, providing customers with a seamless and tech-savvy experience. Such digital innovations not only enhance customer satisfaction but also lead to increased efficiency in various aspects of the industry.
Trends and Predictions for the Construction Industry
The construction industry in India is projected to grow at an annual rate of 6.2% from 2023 to 2026. This growth can be attributed to a robust plan of infrastructure projects spanning various sectors. Government initiatives such as Atmanirbhar Bharat, aimed at boosting domestic industries and MSMEs, and the Pradhan Mantri Gati Shakti National Master Plan, driving economic growth through infrastructure development, are expected to attract substantial investment in the construction industry.
The Road Ahead
ACube Ventures, under the guidance of Ashish Aggarwal, is committed to building a comprehensive eB2B platform that will unify the highly fragmented and unorganized construction industry. The company is focused on strengthening its vendor base by establishing direct ties with manufacturers and brands, which will enable them to offer a wide product range at competitive prices to consumers. Furthermore, ACube Ventures is actively working on providing solutions to longstanding procurement challenges in the industry.
In the future, the company aims to expand its customer reach by offering integrated services to address operational challenges effectively.
The Indian construction industry is witnessing unprecedented growth, driven by the surge in housing demand and infrastructure development. However, rising material costs and supply chain disruptions have presented challenges to developers, impacting the prices of construction materials. In this dynamic landscape, the adoption of digital technologies has become imperative for the construction industry to enhance efficiency, improve customer experiences, and streamline processes. As we move into the future, the industry can anticipate a continued emphasis on digitization to drive progress and meet the evolving demands of consumers. ACube Ventures, under the leadership of Ashish Aggarwal, is actively contributing to the digital transformation of the construction industry, facilitating a seamless and customer-centric approach to construction projects.