ABSTRACT
This chapter describes empirical content and qualitative aspects draw upon field surveys of the flooring tile cluster in the Morbi town and garment cluster in the Ahmedabad city, undertaken twice during 1994 – 1995 and 1998. The garment cluster of Ahmedabad shows that the drive to compete and excel by small firms largely derives its impetus through certain forms of collective action. Intense inter-firm competition is a normal phenomenon in industrial clusters, where capturing as much of the market share as possible becomes a survival strategy. In the flooring tile cluster local rivalry is evident. This has been largely because entry barriers, of technology and capital, are practically absent. Product differentiation and marketing skills remain the essential instruments of business growth in a highly monopolistic market scenario. However, creating novel garment designs was stated by most respondents as a major strategy in product differentiation.
