D054 Shruti Singhal | B054 Romill Sheth | B019 Geetika

Gulyani | B036 Tarang Mahajan B045 Saurabh Nagar |

Industry Overview
The Indian branded apparel
industry is estimated to be $10
billion in size and growing at 10-12%
per annum

The branded garments segment will

grow to 48% of the overall
readymade garments segment in
2019, from 35% in 2014

Between 2010-2011 and 2015-16,

modern retails share has increased
from 7% to 16% and this is set to
grow to 37% of overall retail trade
by 2021.
The e-tail market is expected to
grow to $44 billion by 2018 from $13
billion in 2014, apparel being the
biggest contributor, accounting for
31% of online retail.

The mens apparel segment clocked

an annual growth rate of 10% over
2010-2015 and is estimated to post
8% by 2020, growing from $13
billion currently to $19 billion.
The womens apparel segment,
which clocked a 9.5% CAGR over
2010-2015, is expected to post an
8.5% CAGR by 2020.

Porters 5 Forces Model

Customers have
multiple options
to choose from

Bargaining
Power of
Customers
(High)

Entry into the

industry is cost
intensive

Bargaining
Power of
Suppliers
(Low)

Competitive
Rivalry
(High)

Threat of
New
Entrants
(Moderate)

Suppliers have
low bargaining
power due to
reliance being
completely on
the companies

Threat of
Substitution
(Low)

No Substitute
Products to
clothes

Key Industry Trends (Omni Channel

Retailing)
Selling Across
various
channels

Multiple Touch
Points

Enhanced
Customer
Experience

Integrated
Supply Chain

Key Industry Trends (Retail Analytics)

Company Overview

History

Product Range

Retail Footprint

Founded in 1960 by
John Bissell

1976: Upholstery
fabrics, home linens

Retail expansion
since 2004

Export house
converted to domestic
retailer in 1976

1980s: Garments

2000: Non-textile
range

180 stores across

73 cities as of 2014

International
expansion to
Singapore, Dubai and
UK

Franchise model to
expand into Tier 2 & 3
cities

Also sells online

through own website

In-store design

Exports to over 33
countries

2004: Organic foods

Started as a niche
player but now
changing to
departmental store

2006: Personal care

2008: Handcrafted
Jewellery

16 community-owned
or supplier-region
companies as of 2014

2014: Fables

The Fabindia Ecosystem

The Fabindia Ecosystem

Supply chain based on inclusive capitalism through an

elaborate community owned model
Fabindia helps create livelihood for around 55000
artisans and their families
The PSC selects new artisans and weavers and ensures
that quality standards are met
Over years, Fabindia has added several new product
lines to the business, from apparel to jewellery,
furniture and personal care products and even organic
food
Created value by bringing together decentralized
producers and placed high quality product offerings to
its clients

The Fabindia Supply Chain

Supply Chain Analysis

Automated large portion of ordering process

Individual Store Inventory Management
Bulk Order
Back up order
Benefits
More jobs in the rural part of the country
More working capital
Direct interaction with artisans
Closer to sourcing which leads to shortened supply chain,
better pricing and quality

Key Issues being faced by Fabindia

Scaling
Revenue targets are high
Suppliers arent well equipped
Many SKUs
Large processing time
Localized Networks
Products go through various hubs
Increased go to market time
Standardization
Material and competency can
change
Maintaining same quality
difficult
Lack of modern equipment

Key Issues being faced by Fabindia

Capacity and Capital
Constraints
Land and machinery costs

Although I am very tech savvy yet,

I would prefer the
warmth of the
store and touch & feel of

New Product Launches

Stake in Organic India
Organic Food
Is using the same supply chain
Perishability and accuracy issues
Tax Issues
Transfer pricing guidelines
Complicated tax calculation
Hence, maintenance issues

Fabric over online shopping. Online is just not

personalized enough
A loyal customer

Key Issues

Raw Materials

Difficult to predict
quantity and time
ofThaan coming
from weaver

Transportation

Delays in delivery
from artisans,
designers

Opportunity losses
dueto irregularity

Suppliers were
spreadpan-India

Diverse portfolio of
products

Difficult to
implement
technologies,
processes for
suppliers

Marketing

Unique model of
owned, multi-brand
stores, online web
store & e-commerce

Local &
International
marketing expenses

Different stores are

encouraged to order
different stock

Standard products
across all channels
are difficult to find

Diverse portfolio of
products
Transport, storage
and shelf-life issues
of organic foods
Opportunity losses
dueto irregularity

Supply Chain Optimization

As we already know, some integration in Fabindias supply chain has
been already built in through FabIndias stakes in SRCs. A complete
integrationof the SRCs willlead a greater degree of control over the
supply chain and better align the motives of FabIndiawith those of the
artisans.
This will lead to overall greater order quantities and hence a greater
amount of profits.
Ease of Expansion
Quality Control

Fabindias International Expansion Strategy

Channels to International Markets :

The biggest overseas market forFabindiaare Canada, Australia,UK,Qatar,and

Oman
The complete product range is exported from India.
To lure potential international customers, special collection showcased in Indian
handicraft and gift collection fair in New Delhi
Retail:
Internationally Fabindia owns stores in Rome (Italy), Guangzhou (China),
Dubai(UAE), Manama (Bahrain) and Doha (Qatar). The product range consists of
garments formen, women, children and infants; garment accessories; home
furnishings
Wholesale exports:
Currently, Fabindia exports products to more than 30 countries, sells to wholesalers
and secondary retailers according to agreements made with them.
Institutional sales:
The potential customers are heritage hotels and multinational corporate houses.

Recommendations

Learnings
Create an exquisite, high quality and exclusive
product
A price point that defines that exclusiveness yet
not out of reach of common man
Operate at a niche market with limited
accessibility that builds an aura
Never advertise but make people talk about the
product and shopping experience

Ishanya Mall, Pune

Khan Market, Delhi

Mega Mall, Gurgaon