India has a rich tradition of textiles which dates back many centuries. The history of the Indian readymade garment industry, however, is very recent and can be traced back to the Second World War.

During the Second World War, as a contribution to the wartime needs of British rulers, clothing units for mass production were set up to manufacture military uniforms. With India’s independence in 1947, the industry stagnated as the policies of the Government were now diverted towards building a new nation. However, the industry began to expand after 1959 with the revision of the textile policy to allow the import of machinery for manufacturing.

The 1960s witnessed social shifts as a whole generation of young people questioned the very basis of their existence, and the hippie movement was born. Tired of their materialistic ‘man-made’ lifestyle, these young people began to seek answers in communing with all things natural, love and peace being the anthem. They began traveling, to explore, to seek the ancient philosophies of the East.

This voyage of discovery not only led to a change of lifestyle, but also the way they dressed. Natural fibres were rediscovered, and principally amongst them “Cotton”. India, with its natural abundance of this fibre, was an automatic choice of a supply source. Simultaneously, the growing settlement of Indian abroad led to a ready outlet for a variety of India merchandise and clothing textiles as an article of trade because of its growing demand.

This sudden demand for cotton garments resulted in the Indian industry growing by leaps and bounds in a very short period. Export of “High Fashion” garments from India started off with the cheap cotton kurtas and hand-block vegetable dye printed wrap-around skirts in cotton sheeting to meet the demands of the western youth.

Cashing in on the boom any and everybody got into the manufacture of clothing. The Government, realizing the potential of earning foreign exchange for the country, announced incentives and tax exemption for exporters. The fallout was an industry that grew in an unorganized manner and developed a reputation for producing low cost, low quality, volume merchandise.

The 1980s established that the industry was here to stay but, in terms of product profile, India still had not been able to move out of the lower end of the world market and continued to have an average unit value of under US$ 5.

The 1990s saw the industry make a conscious effort to shake off the image of being producers of cheap, low-quality merchandise with unreliable delivery schedules. The second generation had begun coming into the business, and contributed to reorganizing their firms for clearer structure and professionalism. Funds were ploughed back into the business with the emergence of large and modern production facilities. Even though most of the export houses were family-owned, trained professionals were inducted into the business for clear-cut departments and areas of functions. Consolidation and retention of business was the focus of the late nineties as the abolition of quotas planned for the new millennium became a reality.

The industry was euphoric but at the same time apprehensive of what the post quota era would bring. Many of the producers looking for a synergy in the business and also to sustain the large production facilities began tentative forays into domestic retail. The face of the Indian consumer was changing. Exposure to the western society via the electronic media helped in creating a ‘borderless’ world for lifestyle products, and contemporary fashion merchandise found a ready market in domestic retail.

The new global consumer over the years has evolved as a demanding and yet discerning individual. The novelty factor along with price and quality has become the watchword of the new millennium consumer. As consumers around the world change, so does the product strategy to keep consumer interests alive and ensure loyalty.

The new millennium has seen the emergence of the ‘Quick Response’ or ‘Real Time’ merchandising in fashion as a strategic solution to nurture, retain and grow the business. ‘Fast Fashion’ was born. Retailers could no longer work on the concept of two major retailing seasons with a couple of promotions thrown in. Product planning and the merchandise on the racks had to be constantly current and trendy.

Fast Fashion is not simply a solution to increase consumption by introducing greater product variety but a strategy to retain, consolidate and sustain the market through proactive product development and efficient product delivery to consumers, and thereby grow the market by increasing market share or developing new markets.

However, fast fashion has been tried and tested in different avatars through the years. In the 1960s and 1970s it was present in the quick reaction time of the unorganized sector to service the demand for block-printed ethnic clothing merchandise. In the 1980s and 1990s it was represented in the proactively researched product development at the source market level by wholesale importer/designer buyers (like Rene Dehry, Giorgio Kauten, Diff and Steilmann). Today it is technology-aided product research and development techniques (practiced by Anthropologie, Rampage, Zara and H&M), coupled with responsive buying processes.

In product design terms, India has moved on from producing and selling ‘fashion basics’ to ‘basic’ merchandise, and now back to ‘fashion basics’ once again. History says that this is where India’s inherent talents and strengths as a source market lie. Rather than reinventing the wheel or try to catch up with other competitors strengths, India should cash in on its strengths to practice and master fast fashion.

In the business of fashion, time has always been important. However, speed and efficiency are now both a strategic imperative and a tactical necessity. With greater unpredictability in the market, it is critical to have the correct product at the correct time in the right quantity. Fast fashion requires completely different thinking in the way product is developed, how pre-production processes are undertaken and how production is organised. The Fast Fashion Seminar will draw upon the live experiences of leading practitioners from the area of product development and supply chain. It will be structured as an interactive session. This Third Eyesight Fast Fashion Seminar will provide you with a valuable insight into how to effect rapid changes in the market to your benefit.

Among other aspects, it will:

• Describe in detail the concept of fast fashion

• Identify key strategic actions to meet fashion consumer demand

• Detail how leading brands such as Zara operationalise the concept

• Discuss how to achieve less than 1% inefficiencies in their processes from design to delivery, including inventories and markdowns substantially below the industry average.

• Understand the underlying principles of the fast fashion model and how these might be applied to retail and fashion business models in India

Attendance is strictly by pre-registration. Registration information is also available over phone (please contact on phone +91-124-4293478 or +91-124-4030162).

April has opened eventfully around the world, when it comes to food prices.

A leading Indian business daily opened the first week of April 2008 with a story saying that chain-stores may be as much as 15-40% cheaper than street vendors for staple vegetables and fruits. When we put this against the backdrop of concerns at skyrocketing global prices of rice and fuel, as consumers we may have a reason to thank the chains for helping to balance our monthly budgets.

But is this really a victory for proponents of organized retail, or a blow against retail chains?

The same article went on to state that chain stores were offsetting the hit they were taking on food by selling other products that offered them more margin, “an option not available to hawkers”, and also quoted leading Indian retailers.

The very same day, media in Hong Kong were covering a survey that stated that supermarket prices in the city were on average 12% higher than independent grocers, with some branded products being sold for as much as 20% higher. The Democratic Alliance for Betterment and Progress of Hong Kong, which carried out the survey, cautioned consumers that they should not be misled by supermarket ads for big discounts and advised them to compare prices frequently between chains and independent retailers.

(The study did not compare price differences now to what they might have been 20-25 years ago, when the market was not so consolidated. Such a study may provide some other interesting insights.)

During the same week, the government of Ivory Coast in Africa also responded to protests by women and youth in Abidjan against rising living costs with an emergency meeting and lower import duties on key food items.

Obviously inflation, especially in food prices, is a global concern right now, so this simultaneous appearance of news across countries is hardly a coincidence.

They, however, do raise concerns about how the chain of food supply and retail is structured, and also some important questions about competitive strategy.

Let’s deal with competitive strategy first. Obviously, the terms “loss leader” or “key value item” have been coined in the last few decades, but the strategy itself has been well-known and widely used since the time humans started trading thousands of years ago. 

The foundation of the strategy is built on items that are a staple, usually widely compared by consumers or used as a benchmark when comparing different merchants.  A merchant may place a very low margin on such a product, or sell it at cost (or even at a loss).

The concept is simple: attract a customer into the store with an irresistible offer, but make sure that consumer also buys other products that provide enough profit to the retailer. 

As a consumer you may feel outraged that someone is “cheating” you, but in our “sensible” and rationally-aware moments we as customers know that this happens frequently, and know how to avoid it. However, we are not always rational – if shopping were purely a rational exercise then automated comparative software would be fulfilling all our shopping needs by now.

Stepping beyond the retailer-consumer relationship, there is also question whether this can be classified as free or fair competition when cash-rich organizations with a wide basket of goods, take the strategy to the doorstep of the small individual trader whose product offering is much narrower and usually concentrated on the staple goods that are being discounted.

There is no really easy or quick answer to this question. 

On the one hand, large retailers such as Wal-Mart, Carrefour, Tesco, Metro and others, have been widely credited for achieving cost-efficiencies from scale, and then passing on these efficiencies to the consumer in the form of lower prices (and, apparently, higher standards of living).  That is a good thing and definitely of benefit to the population at large, especially in inflationary times such as these. Rather than keeping prices high due to inefficient sourcing, wasteful and expensive handling, and non-value-adding costs in the supply chain, it is surely a good to push for lower costs.

On the other hand, there is no simple way to draw a line when competitive benefit to the consumer becomes predatory pricing within the trade. 

If a retailer took price reduction as a “strategic investment” to grow a market (as happens in markets and product categories around the world), when do you start calling it “unfair”? And should you even attempt to label it unfair? What is the cost to the market, when it could eventually concentrate and consolidate market share in few hands? Is the cost to society more in supporting small inefficient retailers, or more if these retailers lose their independence and become employees? (If you’re looking to me for the answers…sorry, I don’t have them yet!)

Value judgements are almost always subjective rather than objective. ‘Large versus small’ conflicts are frequently emotive rather than rational. And even though there are no easy answers, I believe we should think about these questions, as businesspeople, as consumers and as social individuals.

There are some rather interesting (and by no means conclusive) studies, opinion papers and books that have looked at the structure and economics of the food supply chain, but constraints of space force me to postpone that aspect to another column. The questions and competitive strategy will not be disappearing quickly, so I’m sure these will still be relevant then. 

Meanwhile, I’m sure we have enough food for thought!

As brands and retailers expand their operations nationally, they begin to look at consolidating their back-room operations. Typically finance is already centralised, but other operations such as store opening project management, logistics etc. are also centralised for smoother and more efficient operation.

And then comes a big day when someone senior decides that the company should have a single toll-free or local dial number that customers from around the country can call.

Of course, India is already acknowledged as the call-centre of the world, so this should be easy. Right?

Wrong.

Call centres that are operating internationally from India have become famous (notorious?) for acclimatization, enculturation, liguistic training etc. of their staff. After all, they have figured, a customer in Texas is pobably much more comfortable speaking to a Sam than a Samir or to a Jack rather than a Jaikishan. And, beyond the name, they are also provided detailed background on the environment in which their customers live, so that they can have a “conversation” rather than sound as if they are script-driven phone-jockeys.

Domestic contact centre staff (and their domestic customers) are not so lucky.  The hardware may be in place very quickly and efficiently, but the softer aspects have huge gaps. Either this is because the costs are too high (compared to the revenue available domestically), or it may be because this has not even occured to the company as being as issue they should think through.

Languages and accents apart, there is a world of a difference even in terms of the way people deal with each other across India. A customer care person sitting in Chennai may have as little in common with a Punjabi customer from Delhi or a Bengali customer from Kolkata, as they might have with a Spanish-speaking customer based in Mexico.

To companies who are looking at providing single-point phone contact for consumers across the country, I would suggest looking at India just as one would look at the EU.

(For instance, a German company wanting to provide EU-wide single-number dialling would need to ensure that the calls originating from France land at the desk of a person who can speak French and is comfortable with the context of the French customer, and similarly for Poland etc. India is actually no different in its diversity.)

Acknowledging the differences and gaps would be the best first step in building true bridges with customers across the country, and providing better service.

Fashion merchandising textbooks state – a society that is fashion aware and fashion conscious is a society that is economically healthy. Thus Fashion is a reflection of lifestyle. In the Indian context it is a reflection of the growing ‘affluence’ of urban India – the upwardly mobile Indian middle class, more so, the upper middle class. The growth and progress of the Fashion Industry in the last ten years has even warranted the institution of the bi-annual Fashion Industry event, which is eagerly awaited both by the producers and buyers of fashion in India. Every year the fashion fraternity, glitterati and media await this event with much excitement and impatience. For weeks leading up to the event one reads of the who’s who of the International Fashion scene, the top of the line buyers expected to attend the event ……and yet, when the dust settles, Indian Fashion is yet to truly make its mark on the international scene.

Internationally the Indian apparel industry is better known as a supplier of competitively priced, mass produced, ‘fashion basic’ apparel merchandise sold by various retail chains and discount stores. In design terms however, that merchandise cannot be truly distinguished from any of the other merchandise on sale in the same outlets that have been produced in other Asian, Caribbean or east European countries. So where is the uniqueness of Indian fashion/design visible globally??? And yet when India forayed into the global clothing business in the late sixties it was its design identity of unique silhouettes, textiles and value addition techniques that gave it international acceptance and demand. What sold very happily and profitably at that juncture was ‘Brand India’ through it cotton crepe kurtis and ‘drawstring pants’, and its hand block printed wrap skirts. Indian fashion laid the foundation of an industry that today employs over 35 million people and contributes 14% to the GDP of the nation.

Indian Fashion has true potential to grow exponentially in the next decade, but before that there are many issues that the creators and producers of fashion need to address.

Most importantly what comes to mind is design discipline, understanding the commercial viability of design and realizing that the business of fashion is like any business enterprise. To grow the fashion business, fashion merchandise has to reach out to market segments beyond the fashion leaders and innovators and consumers of bespoke fashion or couture apparel. Product design through design discipline should enable a product to be scalloped and extend the product’s life span to justify the cost of design development. The product line has to evolve beyond the all encompassing design technique perspective. It has to have an individual signature that has a sense of permanence and identity of ‘unique’ design like an Hermes scarf, a Chanel jacket, a Bill Blass sheath dress or a LV handbag. The signature design element itself becomes the product’s brand identity.

The Business of Fashion requires business strategies, planning, organized marketing and selling, promotion and positioning. Design research based on market and consumer feedback, lifestyle trends, market economics, raw material resources, colour palettes, textile trends and other factors need to be done in depth and in all seriousness. Fashion merchandise is highly perishable and dynamic. Product research and development needs to become an on going and continuous process, very much like the R&D processes, which are the norm for all other lifestyle products. The business of fashion too, needs to be pre-emptive, and proactive rather than reactive.  Product design needs to be clever and production friendly to ensure timely deliveries with out taking away from the design innovation factor. Market potential needs to be studied vis-à-vis the adaptability of the design/fashion content of the product to enable growth in the market share and business by straddling consumer segments. The time has come for the talented Indian Fashion fraternity to truly shift the focus to the Business of Fashion.