Behind the fashion

  • Madhusheel Arora, Hindustan Times, Chandigarh
  • Updated: Feb 15, 2015 11:41 IST

Shopping for readymade clothes is an experience most of us look forward to. As the economy has exploded, readymade is actually the in-thing, though bespoke has retained its niche share for those wanting that perfect cut to their suits and wedding dresses.

For those looking to the garment trade as a port of entry into business, it is actually a relatively safe port-of-call, especially if you have commercial real-state to spare.

Here’s how the deal goes for most manufacturers, mostly Ludhiana-based, and their partners or their retailers in the region.

As tastes and fashion trends remain fickle in the industry and are cyclical, there is usually a shelf-life for the product. To cover up for this, the retailer is actually encouraged to be proactive in sales and is offered a margin of above 30% when he is busy in cash without any formal association with the company.

In the second model, the company enters into an agreement with the property owner, where he is offered a commission of ranging between a net of 16% per cent and 22 per cent net of sales. Stock ownership remains with the company and the business partner can change the stock as per mutual terms and conditions. The transportation and marketing expenses are also borne by the manufacturer.

The business is attractive to most new-entrants due to its simplicity and the fact that there seems to be very little of the nitty-gritty that can bog down or even scare away anyone.

There are challenges though for the business, the chief being that this is a customer-centric personal choice field where customers can be fickle. Ever wondered why most garment shops seem to have the sale board on for the better part of the year? This is even as winters are by far the most important season for those in the trade as more items are sold and fashion in clothes is to an extent, dictated by the cold northern winters. Weddings, of course, are also a main draw that retailers in the trade would want to be more a yearly affair than the seasonal events they currently are.

This season, most retail shop owners in the tricity have been lamenting the fact that there have been relatively fewer weddings this year.

With most functions scheduled for a single day, people have also tended to miss some, or worse for traders, gone along with the same dress to two weddings than buy another one. Minutiae like these can be the difference between a great and a good month for the business.

The manufacturer’s challenges in the trade are immense. With multinationals getting their stuff manufactured from Bangladesh or even say Indonesia, local makers like those in Ludhiana bank on the strength of their distribution network to expand business. Most owners like the Jains of Duke and others have specific divisions looking into these issues, as more professionalism is introduced into operations. Still, to be in tune with the market remains a challenge as also expanding the product range, in terms of the colour and the design. Strengthening brand image is something that pays rich dividends here in terms of increased pricing power and customer perception of the belonging to the ‘upper crust’.

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