GST will certainly reduce a lot of paperwork in future
What are the three trends shaping up e-commerce over the next five years? What are the bottlenecks? How do you see GST impacting this industry? How do you see foreign players operating through Indian portals? How are you managing the supply chain?
Trends shaping e-com: From fashion’s point of view, more and more retailers will limit stocks and try to focus on customised merchandise in every major product category. Each collection will become theme-specific in order to give variety to customers. Pricing will play a major role in e-commerce.
The major issue in any fashion retail business is always excess or dead stock. This is the main reason why most brands fail to make a mark in the market in the long run, as most of their resources get exhausted. By limiting this problem, a company can succeed in the retail market. Going forward, a lot of technology, research and development have to be induced so as to minimise wastage and optimise sales with stock in hand.
Bottlenecks: With reference to bottlenecks, there needs to be a mechanism to reduce returns from customers. Online marketplaces need to develop quicker systems to upload more brands while payment cycles need to be supplier-friendly. Special emphasis needs to be on how to handle customer returns as it becomes a major hassle for the manufacturer. Sometimes, the goods are not returned in good condition or they have been used and then returned, which makes it difficult to re-use these products. The manufacturer has to bear heavy losses in such cases.
Impact of GST: GST will certainly reduce a lot of paperwork in future. This will increase productivity of the company. The policies are still in the making, and it will take some time to have more clarity on the actual impact on the fashion industry.
Foreign brands on Indian portals: I think it is a good thing to have foreign brands coming to India and selling products online. This offers variety to Indian customers and keeps local players on their toes. However, return policy is the major challenge in spite of the fact that we send our products after stringent quality checks. Most customers return the product for no reason at all. This is a major problem, and needs to be addressed urgently to strengthen the online fashion business. Apart from this, the conversion rate is still less, so we plan to engage specific audiences relevant to our brand themes through online as well as offline promotions.
Sizing: Size charts on websites will remain an issue unless we customise products coming into production. The issue does not lie with consumers as they can be of any size or shape. The best thing to do would be to alter production techniques to fit any size. The concept of virtual styling and online fitting rooms have not caught on despite being talked about for a few years. The reason lies in reluctance of businesses to experiment. If the mind of a creator does not open up to latest technologies, it becomes difficult for such concepts to go forward.
In M-commerce, navigating through catalogues is a problem. To get over it, targeted marketing to theme-specific audiences can help. So can engagement through social media like news articles specific to products, contests and games. Though we do not rely heavily on social media, it is going to be a major marketing activity. It is early to talk about the impact it has created, but surely it is an important marketing tool. Advertisement spending is an expensive affair and unless you achieve certain numbers, it is not feasible to advertise.
We are not relying on apps now, but going forward, I believe apps will consolidate brands for a consumer. One app might offer ten different brands’ merchandise, but specifics are the key. The mindset of the consumer has slowly tuned into discount-oriented buying. I believe that if a brand is sure of its product, pricing and target audience, discounting becomes immaterial. Consumers will buy products if they like them.
Supply chain management: Supply chain management is as important as a vital organ. Without proper warehousing, everything starts to fall apart. We have introduced technologies and software in our business that help us manage inventories. Once you get the hang of it, inventory management does not seem like a big task.
Published on: 01/02/2017
DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.