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    Fabindia Final Presentation

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    Shruti Singhal
    The Indian branded apparel industry is valued at $10 billion and growing at 10-12% annually. Modern retail's share is increasing and expected to reach 37% by 2021. The men's and women's apparel segments are both growing at around 8-9% annually. Fabindia was founded in 1960 and started as an export house but transitioned to domestic retail in 1976. It has a unique supply chain model of community-owned supplier companies that provides livelihood for over 55,000 artisans. Fabindia faces challenges in scaling operations, standardizing products and processes, addressing capacity and capital constraints, and launching new product categories like organic foods. Recommendations to optimize Fabindia's supply

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    Fabindia Final Presentation

    Uploaded by

    Shruti Singhal
    681 views17 pages
    The Indian branded apparel industry is valued at $10 billion and growing at 10-12% annually. Modern retail's share is increasing and expected to reach 37% by 2021. The men's and women's apparel segments are both growing at around 8-9% annually. Fabindia was founded in 1960 and started as an export house but transitioned to domestic retail in 1976. It has a unique supply chain model of community-owned supplier companies that provides livelihood for over 55,000 artisans. Fabindia faces challenges in scaling operations, standardizing products and processes, addressing capacity and capital constraints, and launching new product categories like organic foods. Recommendations to optimize Fabindia's supply

    Original Description:

    Supply Chain Management of Fab India.

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    The Indian branded apparel industry is valued at $10 billion and growing at 10-12% annually. Modern retail's share is increasing and expected to reach 37% by 2021. The men's and women's apparel segments are both growing at around 8-9% annually. Fabindia was founded in 1960 and started as an export house but transitioned to domestic retail in 1976. It has a unique supply chain model of community-owned supplier companies that provides livelihood for over 55,000 artisans. Fabindia faces challenges in scaling operations, standardizing products and processes, addressing capacity and capital constraints, and launching new product categories like organic foods. Recommendations to optimize Fabindia's supply

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    681 views17 pages

    Fabindia Final Presentation

    Uploaded by

    Shruti Singhal
    The Indian branded apparel industry is valued at $10 billion and growing at 10-12% annually. Modern retail's share is increasing and expected to reach 37% by 2021. The men's and women's apparel segments are both growing at around 8-9% annually. Fabindia was founded in 1960 and started as an export house but transitioned to domestic retail in 1976. It has a unique supply chain model of community-owned supplier companies that provides livelihood for over 55,000 artisans. Fabindia faces challenges in scaling operations, standardizing products and processes, addressing capacity and capital constraints, and launching new product categories like organic foods. Recommendations to optimize Fabindia's supply

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    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

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