Mr Kothari, let us begin the talk with your outlook on present state of textile and garment-retail industry all over the world.
Interest rates, government policies and incentives, exchange rates, raw material prices all affect ones competitiveness in the global market. Rising living costs have been a concern all over. The Textile industry in India, especially manufacturing, has grown multifold since introduction of Government sops like TUFS, etc. However, the industry has been considered as an underdog for over a decade, and has been outperformed by other upcoming sectors. Having said so, I maintain a bullish outlook for the sector.
So, in the backdrop of said set of happenings, how is ethnic-wear retail likely to shape up? What would be your description on current movements, market dynamics domestically and internationally and the future of the segment?
The demand for textiles will only grow, unless you are in the premium segment where your brand perception commands growth. Rising costs have been a little concern for the retail industry. Rentals are the primary overheads, which are still very high in prospective locations. However, we plan to enter the retail space in Tier 1 & 2 cities by next year. We plan to start a few flagship Company-owned showrooms before venturing into our revenue sharing model (Franchise).
Our current focus, however, is on manufacturing of ethnic wear and we are concentrating heavily on design (R&D) and marketing of our manufactured products to wholesalers and retailers across India. Retailing through our brand would be the next step, once we have established ourselves as regular trendsetters in production across the different categories of ethnic wear (Sarees and Lehengas). Manufacturing of Sarees and Lehengas has been largely done by the unorganized players and as with all the industries, the scope in manufacturing is vast and limitless, it only depends on how we fit in.
Well, then to fit in best, what formula for a brand recall in ethnic-wear works well here in India? What quotient pleases your consumers – fashion, price or quality?
The factors depend on the brand placement and the local perception. Our VIVIDHA brand is in the value segment. We believe that in our segment, the designs should keep on flowing in and out of the store at the perfect mix of fashion, price & quality; anything lying on the rack for long is unacceptable. The business model should reward commitment and performance from the franchisees and the sales workforce.
Polyester, Viscose or Cotton, all these, today, make up a complex scenario in the market for fabric makers in your line. What say?
Yes definitely they do. We concentrate on value additions to these fabrics by man or machine. Selection of a perfect combination is the key to selling. And yes, our business dynamics are complex: Choice of fabrics, colors and raw materials like threads/sequins/beads/stones coupled with a plethora of designing possibilities – They make our products ‘VIVIDHA’ in its truest sense!
Now, talking policy; an anti-dumping duty of up to US$ 4.82 per kg on Chinese viscose filament yarn shall continue until February 24, 2012, according to the Department of Revenue. Will this add to your woes any way, in particularly, as your group plans to set up Rs.100mn embroidery unit?
No, it wouldn’t. Lehengas, in general, are highly value-added with a variety of synthetic, semi-synthetic & natural fabrics used. We plan to create a niche in the Lehenga segment through our design & innovation which will definitely command premium. An increase in one of the fabric’s price is not going to affect our Embroidery business.
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