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Mark has a personal valuation of US$12.5 billion (correct as at date of writing) with his social networking site, Facebook.com. In fact, in 2010, Zuckerberg was named Time magazine's Person of the Year.
In the fashion world, we have Sanjay Garg. He is the founder of Raw Mango which deals with contemporary hand woven textiles, such as saris, fabrics and stoles that retails through various exhibitions and at high end stores in different parts of India. Sanjay is also the winner of the British Council's Young Fashion Entrepreneur Award for 2010.
What really sets these entrepreneurs apart from the rest of us?
My personal opinion - their ability to START!
Most times, what we learned in business schools and textbooks are very theoretical in nature. We are often taught topics such as Accounting, Finance, Economics, and Management and so on. They are meant to educate us to be more analytical and to calculate risk before starting a business.
However in most cases, by learning more and analyzing deeper, we tend to hinder ourselves from taking the first step forward in realizing our entrepreneurial dream.
We hope to search for the elusive PERFECT business idea that will make money without a shadow of doubt.
Unfortunately, there is no such thing as a fool-proof business idea!
And thus, we fail to START.
However, I am not suggesting that you should go headlong in setting up a business without any careful planning or to seek advice from fellow entrepreneurs.
But, in essence, there's no such thing as a SURE THING when you embark on your journey as an entrepreneur.
Unfortunately (or fortunately), you need to take the first step to START the journey in order to know the final outcome - whether your business idea can become a successful realisation or not.
Thus, if you have a business idea in your head, you will never realise them until you take the first step, and the only way is to START!
I am confident that you will gain a lot from this book written specially for Fashion Entrepreneurs. And I wish that you will enjoy the journey in the very near future as an Entreprenuer as much as I have done.
Associate Professor Dr. Alvin Chan is the Academic Director of Raffles-C.U. International College (RCU). Besides being an academic, he is an Entrepreneur and an advisor/consultant for young start-ups in Asia.
Professor Alvin Chan graduated with a BA (Merit) in Economics and Southeast Asian Studies from the National University of Singapore, a Post-graduate Diploma in Education from Nanyang Technological University (Singapore) and an MBA from Edinburgh Business School (UK). In addition, Professor Chan obtained his Doctorate of Business Administration (DBA) from California Coast University.
INTRODUCTION TO ENTREPRENEURSHIP
The word Entrepreneur comes from French. It literally comes from the words "Entre" meaning "in between" and "preneur" meaning "jobs". So it's not surprising many Entrepreneurs get their start after being fired from previous jobs. In the early days of Silicon Valley in the 1960s and 1970s, a would-be Entrepreneur would slave away in the engineering department of a large hardware company for many years before asking questions like "How come the bosses make all the money?", "With all this hardware being made, don't people need software?" and "What exactly is meant by software?" Usually by this point their managers had noticed that the engineer is too busy asking philosophical questions to get any real work done and fires him thus giving birth to a new start-up company.1
However times have changed now, today one who has an innovative idea, dedication and the passion for his/her venture, will turn it into a success story. It's all about the zeal & belief in one's idea that would help one live his/her dream with the support of a well calculated risk and a strategic plan.
Entrepreneurship is an opportunity for all to cash on with no bars, age, gender, education, and region, to deter you from following your dream project.
Steve Jobs once said, "You can't ask customers what they want and then try to give that to them. By the time you get it built, they'll want something new."2 It's all about zeroing on a product or service even before the customer demands for it. Creating the need for one's product once it is ready for the launch. That's what you call being proactive and thinking out of the box.
An entrepreneur builds an empire on his vision; the man who proved it true and went to make one of the biggest empires in India from scratch was Late Shri Dhirubhai Ambani. The man went from rags to riches in true sense and was listed in the Forbes list of billionaires. He started as a small time worker with Arab Merchants in 1950's but within a span of 8years he decided he wants to be his own boss. That's when in 1958 he set up his business of spices. After making profits there he ventured out in textile business and established a Mill near Ahemdabad. He later on in the same year went on to forming the Reliance Industries. Since then there has been series of success stories and tales of expansions. The company has further diversified its portfolio by adding Telecom, internet, petrochemical, power, and retail.
There are so many such entrepreneurs who went on to be the master-minds for many innovative strategies that are not only an inspiration to youngsters today but also the subjects of various authors.
Let's look at someone who is much younger than Mr.Dhirubhai and carved a niche for himself Gurbaksh Chahal or G as he is called. He was 4 years old when his family went to America through a lottery visa won by them in 1985. His parents had to do menial jobs to provide education for their four children. For the Chahal family, as for many immigrants, education was paramount, but G left high school at sixteen to form Click Agents, an Internet advertising company, which he sold two years later for $40 million. In January 2004, he launched a second company, BlueLithium - the next generation in Internet advertising. The company was focused on data, optimization, and analytics and became a pioneer of behavioral targeting.
BlueLithium was named one of the top 100 private companies in America three years in a row by Always On, and in 2006, it received highest honour as Top Innovator of the Year. (Previous winners included Google, Skype, and Salesforce.com.) On September 4th, 2007, Yahoo! announced that it was acquiring BlueLithium for $300 million in cash.3
He has series of awards to his name as the top innovator and young tech entrepreneur of the year, the latest addition being the Most Influential CEO (2011).
On April 29, 2010, Chahal was awarded the Leaders in Management Award and an Honorary Doctorate degree in Commercial Science from Pace University for his career achievements as an entrepreneur.4
Nothing will happen overnight but as Ben Weissenstein says "Everything starts with nothing". 5
Ben is one of the born serial entrepreneurs who had his first business card at the age of nine. We are sure you are inquisitive to know more about this young man who made it big and is the CEO of various companies, but we leave it on you to research on him.
Entrepreneurs are insatiable!!!
Everyone holds a different view point and definition of entrepreneurs. The below radial shows few such concepts:-
As the saying goes, a true Entrepreneur is as committed as a pig to bacon and eggs breakfast. Everyone else is just making a contribution. And he knows he's got to "break a few eggs to get this turkey to fly". Even if they are other people's eggs, so to speak. Most entrepreneurs are risk takers. Many Entrepreneurs hang glide. And still others are betting against another Kiss reunion tour. What separates a successful entrepreneur from the garden variety is his or her ability to get others to believe in a bigger vision.1
Founder of Body Shop Anita Roddick says "Nobody talks about entrepreneurship as survival, but that's exactly what it is and what nurtures creative thinking. Running that first shop taught me business is not financial science; it's about trading: buying and selling."6
There are various classifications of entrepreneurs as listed below -
Type of Business
Technology in use
Area of Development
Gender & age
Others - Scale of operation,
It is a vast area of study. We would concentrate on the first three classifications to be explained further.
1.3.1 TYPE OF BUSINESS -
Business entrepreneur: Is responsible for inception of fresh innovative idea and establish it as a new venture.
For instance, Ben Weissenstein classifies to be the business entrepreneur whose first venture was to provide the service of running a garage sale from start to finish.
Trading entrepreneur: An entrepreneur who undertakes trading activities such as exchange of goods and services, responsible for marketing locally as well as globally. They are the brand builders.
Industrial entrepreneur: are the manufacturers who develop new products like embroidery, apparel, textiles, electronics etcetera. In simple terms industrial entrepreneurs represent manufacturer of first & innovator of next.
Corporate entrepreneur: They are the hot shots of corporate world responsible for planning, implementation and managing.
Agricultural Entrepreneur: Like the term entrepreneurs or business involving production and marketing of agricultural products (Dairy, horticulture)
1.3.2 USE OF TECHNOLOGY -
Technical entrepreneur primarily rely on product and undertake various quality measures and new innovative technology to churn out high tech products.
Non technical Entrepreneurs develop new branding and marketing strategies to increase product visibility. Their focus is on marketing and not the product in itself hence they on regular basis market cheaper products.
Professional Entrepreneur is always brimming with new ideas. They invest the profits of one business to build another. They keep on rotating their profits. For instance, Rohit Bal after his successful foray in the fashion world, designed jewellery for Kirtilals, and stepped into hospitality industry with his restaurant Veda.
Pure entrepreneurs are number crunchers who are motivated by psychological and economic rewards such as money, fame, success and power.
Induced entrepreneur are those who get motivated by the Incentives, concessions, benefits that are offered by the government, such as Duty drawback for exporters.
Motivated entrepreneurs do not need profits to satisfy them. Sense of achievement and fulfilment is the motivation factor for them.
Spontaneous entrepreneur are inherit traits of a successful entrepreneur through their genes. Entrepreneur by birth.
1.4 KNOW YOURSELF!!!!
Last week, I overheard the conversation between two long lost friends. I know it's not the right thing to do but it was an interesting one I couldn't let my ears off it. One of them started of her boutique after completing the education; let's name her Miss M and other one Miss S was working as a merchandiser in an organisation. They both envied each other's life when the conversation started off. Miss M was living her life by her terms, waking up late, going shopping any day of the week, earning handsome money, no fixed working hours, no one to decide her day to day schedule, go for a holiday when she liked without asking for permission. Miss S was living a risk-less life, no pressure to make the right decision, no pressure to work on weekends or national holidays, 5 day a week job and weekend to her. But as they started catching up on each one's lives, I realised they both had our own individual share of problems or the strings attached to their life in their work lanes. As the saying goes it was just another instance of the grass being greener the other side.
Just like two inseparable faces of a coin, Entrepreneurship and salaried employment both have their advantages and disadvantages. The working, responsibilities and duties differ when we work for ourselves and when we work for someone else. Similarly the rewards and the penalties of both vary considerably.
Some people are cut out for working for themselves, some are not. Just like I can't design or do up my house by myself, someone else might not be able to write the way I do. We all have certain characteristics that make us stand apart from the other. That's what makes all of us unique and creates equal opportunities for each one of us in the market.
Analyse yourself, ask yourself a few questions and learn more what you love to do in your life?
What motivates you?
Can you work under pressure?
How quickly do you adapt to your surroundings?
Not able to adapt
Mark them as your Strengths (S) and Weaknesses (W), and explain each in a word.
For instance, Decision making - if it is strength you can say rational, if it is a weakness you can say impulsive. You can use any word to describe the habit.
Passion for work
Interaction with colleagues
Time bound assignments
Balancing your personal and professional life
What you like to do in your free time?
Reading books to stay up-to-date
Learning and acquiring new skills
Once you pick your choices, ask someone who knows you in and out to do the same for you.
Jot down the similar choices on a piece of paper and read on.
1.5 SELF -EMPLOYMENT V/S SALARIED EMPLOYMENT
Self satisfaction and personal achievement.
Few or none depends on the boss whims and over all company's performance.
Rational productive decisions are to be made. At times, a lot of money and reputation are at stake.
Follows decisions made by the Upper Management.
More opportunities to expand and grow.
Limited opportunities within an organisation and the market
More stability because you creating employment.
Less stability due to downsizing, outsourcing, shutting down operations, relocation etcetera.
With other players in the market.
With co-workers as well as other people with similar profiles.
You make independent decisions without being answerable to people yet taking full responsibility of the results.
You work as per the profile you are hired for.
Profit, income - would vary each month/year
It fluctuates within profit, loss and breakeven.
Fixed with or without performance bonus and yearly appraisal.
Flexible working hours
Fixed working hours
Work anytime, from anywhere in anyway policy.
Go for a vacation anytime.
Work within the set time frame and from an office.
Vacation depends on company policies and leaves granted.
Higher - you are responsible for making rational decisions that would generate profit earning yourself and for the employees you have hired.
Limited to the profile.
Not able to spend quality time with family especially when starting up the business.
Chances of failure.
Different roles to play.
Paper work, approvals etc.
Pay package not as per the work you do.
Chances of being laid off with or without notice.
No control over decisions.
As per working hours.
By now you should know what you want to gain and what are you ready to sacrifice for it.
SO ARE YOU CUT OUT FOR ENTREPRENEURSHIP??
1.6 NATURE OF ENTREPRENEURSHIP
The essential ingredients of an entrepreneurial venture are depicted by the below funnel diagram -
Product - as defined by business dictionary is a good, idea, method, information, object, or service that is the end result of a process and serves as a need or want satisfier. It is usually a bundle of tangible and intangible attributes (benefits, features, functions, uses) that a seller offers to a buyer for purchase.7
Market - is a public place where products or services are bought and sold by an individual or a group. These could be legal markets such as shopping malls, stock markets, or illegal markets such as black markets, drug trafficking, copyrighted media etc.
Business model - A business model describes the rationale of how an organization creates, delivers, and captures value - economic, social, or other forms of value. The process of business model design is part of business strategy.8
There are three types of business models - Business to business, Business to consumer and Consumer to Consumer.
All the ingredients of entrepreneurship will be explained in detail in further modules.
1.7 MYTHS & MISCONCEPTIONS
There are various illusions and false impressions that surround the world of entrepreneurs. These can be misleading and hence it's very important for future entrepreneurs to be aware of the facts and the myths to lead them to the road of success.
Women cannot be entrepreneurs.
A very common statement from the male dominant Indian society however entrepreneurship ventures is as much for women as it is for men. There are many famous women entrepreneurs who have built their successful empires over the years. These include the likes of -
Shahnaz Hussain CEO of Shahnaz Herbals Inc, is a prominent Indian female entrepreneur best known for her herbal cosmetics, particularly skin care products. Currently, the Shahnaz Husain Group has over 400 franchise clinics across the world covering over 138 countries. Her group's products are sold in leading global stores including BloomingdaleHYPERLINK "http://en.wikipedia.org/wiki/Bloomingdale's"'HYPERLINK "http://en.wikipedia.org/wiki/Bloomingdale's"s (New York), Galleries Lafayette (Paris), Seibu (Japan), Harrods and Selfridges (London), and La Rinaeccente (Milan). She has been awarded the Padma Shri, a civilian award by the Government of India in 2006, and Success Magazine's "World's Greatest Woman Entrepreneur" award in 1996. 9
Ritu Kumar - A name the Indian fashion industry reckons with global presence. She is the empress of Indian haute couture and one of India's leading and most gifted fashion designers. 10
Ritu began her venture with four hand-block printers and two tablets; in a small village near Kolkata in the late 60s was incidentally the first woman to introduce the boutique culture in India under the brand name 'Ritu'. Today she has thirty four outlets in all major cities in India and one outlet in America.10
Ashima & Leena - The sister-in-law designer duo of the fashion fraternity started their professional stint in this industry from Big Joes. Today they have retail presence in India through stores like Kaaya, Kimaya and Vama and exclusive exhibitions in Dubai, U.K, and U.S.A. They have plans to diversify into interiors as well as accessories to present themselves as Professional Entrepreneurs.
Financing the venture
The most crucial aspect of any business is the investment. It is responsible for sleepless nights to many budding entrepreneurs. Once the product or service is finalised the most important question to be answered is how much money does one has to invest initially and what would be the source of the investment.
The myth surrounding this aspect of business is - 'Most successful entrepreneurs start their companies with millions in venture capital to develop their idea, buy supplies, and hire employees"11
But the fact is that the venture capitalist is prevalent in selected high tech industries and does not usually fund start-ups. Despite the dominance of venture capitalists in technology driven start-ups, Microsoft Company of Bill Gates and Paul Allen, did not manage to secure venture capital. Another example would be the networking giant Cisco Systems wherein start up finance was generated from personal savings and loans.
"Banks don't lend money to start-ups" 12 is another belief that revolves around frequently. However the statistics prove it absolutely incorrect piece of information. 16% of all financing comes from banks and those starting need to approach banks in the right way.13 In fact a new term was coined for such loans - MICROCREDIT. It is the extension of very small loans (microloans) to those in poverty designed to spur entrepreneurship. These individuals lack collateral, steady employment and a verifiable credit history and therefore cannot meet even the most minimal qualifications to gain access to traditional credit. Microcredit is a part of microfinance, which is the provision of a wider range of financial services to the very poor.14
Forbes magazine said that "microfinance has become a buzzword of the decade, raising the provocative notion that even philanthropy aimed at alleviating poverty can be profitable to institutional and individual investors." "Billionaires, global leaders and Nobel Prize recipients are hailing these direct loans to uncollateralized would-be entrepreneurs as a way to lift them out of poverty while creating self-sustaining businesses," it stated.14
Start-ups can't be financed with debt.12 is another myth busted with the fact that debt financing is more prevalent as compared to equity.
Hence it is said that all that you need is a well calculated and presentable proposal to get you the finance for your dream project.
Entrepreneurship is all about taking uncalculated and wild risks.
The concept is usually a wild risk since many of the start-ups do not have the kind of finance or requirement for planning and strategising. However If we back track the life of an entrepreneur we realise that there were considerable number of risks involved post inception, but these were well calculated risks taken with a clear goal in picture. A lot of reading, planning, thinking, analysing the pros and cons, strategizing and organising is involved which does not appear in text. Only the birth and rise of the star entrepreneur is what makes to the headline.
Qualified & experienced Entrepreneur
Education builds the foundation but it is not a mandatory requirement to make it big. It's not the secret to success. Gurbaksh Chahal an Indian-American who made it big at the age of 28 has founded two advertising companies worth $341 million, and more recently appeared on several TV shows and published a memoir.
He was a high school drop-out and inexperienced person when he established his first company by the name of "Click agents' in the year 2004.
There are hundreds of others who make it to this list, for instance15 -
Frederick Henry Royce, auto designer, multimillionaire co-founder of Rolls-Royce. Dropped out of elementary school.
George Eastman, multimillionaire inventor, Kodak founder. Dropped out of high school.
Walt Disney, founder of the Walt Disney Company. Dropped out of high school at 16.
Either Rich or Rags to Riches
Earning money and generating wealth is not a child's play. It is not necessary that the star entrepreneurs have a sound financial backing to rely upon. There are times when a man born with a silver spoon drains of the wealth and dies on a poor man's bed.
Entrepreneurs are not generally rich and do not have financial success always. There are times, when they initially make huge profits but their uneven distribution of funds can actually be the drowning lane. Only the top ten percent of entrepreneurs earn more money than employees. And the typical entrepreneur earns less money than he otherwise would have earned working for someone else. 12
Alertness and adaptiveness is the key to make appropriate decisions. It's so aptly said that the road to success and to failure is the same, where you would reach depends on the choices and decisions you make along the way.
1.8 ENTREPRENEUR AND ECONOMIC DEVELOPMENT
In a world where ideas drive economies, it is no wonder that innovation and entrepreneurship are often seen as inseparable bedfellows. The governments around the world are starting to realize that in order to sustain progress and improve a country's economy, the people have to be encouraged and trained to think out-of-the-box and be constantly developing innovative products and services. The once feasible ways of doing business are no longer guarantees for future economic success! 16
Entrepreneurs and their role in the economy of the country, is not negligible enough to go unnoticed. The biggest concern of every country, whether it is developed or developing, is unemployment. Unemployment affects the economy of a nation directly as well as indirectly. Developed countries pay unemployment benefit to its unemployed workforce. It's a threat to social security as well. Entrepreneurs and their ventures create employment opportunities for every genre of the society. They become the source of income for many households.
Entrepreneurs are basically concerned with creating wealth for themselves and the people who work for them through production of goods and services. This leads to an increase in the per capita income of a country, hence contributing to the economic development.
Their creative ventures add the newness and the variety to the market. At times, they bring products that not only become a rage nationally but also internationally. The trend catches on a like a vial fever. This works in the positive way for the economy in three ways - First, Direct tax paid by the entrepreneur as he is making huge profits due to increased sales, secondly indirect tax paid by the customer who purchases/uses the product and thirdly the inflow of foreign currency due to exports.
The social entrepreneurs have immense contribution to the society and environment. One of the most prominent social entrepreneurs is Muhammad Yunus Khan, the founder of Grameen Bank - Bank of the Poor. Grameen Bank started its operation in 1976 in Bangladesh by providing microfinance loans to the poor men and women whose loan proposals were not acceptable to traditional banks. Prof. Yunus Khan was awarded the Nobel Prize in 2006. He reasoned that if financial resources can be made available to the poor people on terms and conditions that are appropriate and reasonable, "these millions of small people with their millions of small pursuits can add up to create the biggest development wonder."17
As of December, 2010, it has 8.34 million borrowers, 97 percent of whom are women. With 2,565 branches, GB provides services in 81,376 villages, covering more than 97 percent of the total villages in Bangladesh.17
Anita Dongre, creative director of AND Designs India Ltd, conceptualised "Shop for change" wherein a whole collection of western wear for Indian women was made of 100% fair trade certified cotton. By using Fair trade certified cotton one ensures that the farmers get an appropriate market price for their product and not be deceived by middlemen. Hence Anita Dongre is not only contributing economically through the retail sales of her product but also socially by fair trade practice.
Entrepreneurs like Prof. Yunus Khan, Designer Anita Dongre and many others have given a new dimension to their occupation and a new vision to others. They have set benchmarks for themselves in their own industries while contributing to the society.
Transforming ideas into economic opportunities is the crux of entrepreneurship. History shows that economic progress has been significantly advanced by pragmatic people who are entrepreneurial and innovative, able to exploit opportunities and willing to take risks.18
1.9 FASHION ENTREPRENEUR
Fashion entrepreneur is relatively new and fresh term in popularity, even though fashion entrepreneurs can be found throughout the history.19 Ralph Lauren, Levi Strauss, Coco Chanel, Louis Vuitton and Rene Lacoste are the most famous and successful entrepreneurs not only in their countries but also globally. Other fashion entrepreneurs include Stella McCartney, Harold Tillman, Philip Green, Nicole Farhi and Samata Angel.
The Indian counterparts of the above International fashion entrepreneurs are equally successful and internationally proclaimed but they do not hold the wide retail presence like Levi Strauss, Louis Vuitton and so on. The most famous ones in our home country are - Rohit Bal, Manish Arora, JJ Valaya, Ritu Beri etcetera.
Fashion entrepreneurship is challenging and ever-changing with a 4-8 season cycle depending on the brand and the customers. Fashion industry is demand and design driven hence product innovation is the key ingredient for a successful fashion retail venture. Along the way the fashion product becomes the USP of the brand and recognition for the designer. Each one of the Indian designers has their unique style and design sense which creates remarkable difference among them & a niche in the market.
Let's look at the few famous entrepreneurs who changed the world of Fashion forever, making their ventures a benchmark for the industry to follow.
Ralph Lauren - the designer who provided luxury at all price points.
He sold the clothes, but he also sold the fantastic, romanticized lives of the people who wear the clothes-the look of success.20
Rene Lacoste was the one who bridged the gap between fashion and sports.
Ritu Kumar, the first women to introduce the Boutique culture in India in 1966. She adds a unique aesthetic value to the traditional Indian embroideries making a contemporary statement across the globe.
Rohit Bal is known for his sophisticated cuts and breathing fabrics. He weaves in the best for both men and women. However, there is no one-signature style that the designer sticks to.21
Ralph Lauren said "People ask how can a Jewish kid from the Bronx do preppy clothes? Does it have to do with class and money? It has to do with dreams."22
In the fashion industry, it doesn't matter from where you are what matters is where and what you want to be. It starts with a dream and continues with passion.
1.10 FASHION RETAILING
Clothing today has become the lifeline not only for the rich and classy but also for the masses, it is for elders as it is for youth, it is found at fashion weeks till the Indian streets, from flea markets to malls, from haute couture to export surplus. Clothes are the first impression that you lend to people and that is why being stylish and up-to-date with fashion is the requirement of the day.
For the fashion conscious generation of today, we have fashion retailers that bring the catwalk fashion to our wardrobes. They bring to us the latest trends in fabric, colours, silhouettes and detailing. The retailer who is able to keep pace with rapidly changing fashion trends succeeds. The only success mantra is right product at the right place at the right price. There is tremendous scope for retailing in India since it is still in its initial phases and yet has to reach its Elysium of fame27.
Fashion retailers across the world can either retail directly through web and catalogue or through their stand alone and specialty stores. With the changing lifestyles and shopping trends online retailing has gained momentum lately with new players entering the market.
1.10.1 Retail growth
Retail is in the stage of inception in India and has a lot of scope. The trend of organised retail is still fresh to the Indian Consumer. If the latest statistics are to be believed, India and China will contribute more than 91% of retail sales in the region in the year 2011 with a predicted growth of approximately 1% in each three years.
According to a McKinsey & Company report titled 'The Great Indian Bazaar: Organised Retail Comes of Age in India', organised retail in India is expected to increase from 5 per cent of the total market in 2008 to 14 - 18 per cent of the total retail market and reach US$ 450 billion by 2015. 23
Furthermore, according to a report titled 'India Organised Retail Market 2010', published by Knight Frank India in May 2010 during 2010-12, around 55 million square feet (sq ft) of retail space will be ready in Mumbai, national capital region (NCR), Bengaluru, Kolkata, Chennai, Hyderabad and Pune. Besides, between 2010 and 2012, the organised retail real estate stock will grow from the existing 41 million sq ft to 95 million sq ft.23
With changing government policies, the market of luxury retailing is also expected to grow with brands like Paul & Shark, Zegna, and Diesel have plans to expand their operations and opening more retail outlets.
The growth is not just restricted to fashion apparel and accessories but has seeped in the FMCG and stationary retail as well.
1.10.2 LATEST RETAIL TREND: E-Retailing
Although online sales are a small percentage of total retail sales but the trend is catching on.
The U.S. Commerce Department reported today that e-commerce sales grew 14.3% in the first quarter, following the fourth's quarter 14.6% gain. It was the first time since the first quarter of 2008 that e-commerce sales grew by more than 10% year over year for two quarters in a row.24
According to research from the Interactive Media in Retail Group (IMRG), the online fashion retail sector has grown by around 2,000 per cent over the past decade and this rise is expected to continue throughout the New Year.25
Online shopping is convenient due to flexi-timing and place of shopping. One can make a purchase at any time from any place with the plastic money available. One doesn't have to travel long distance to pick up a dress for the party over the weekend or go to pick up the formal shirt for the next business presentation after office -hours. 26
There are sites, the virtual dressing room, where one could dress up themselves and choose from a range of clothes based on what suits them the best. 26
The first online web cam virtual dressing room was introduced by Zugara in June 2009. Tobi was the first online retail store to launch the Fashionista product in November 2009, which allows at home consumers to virtually try on clothes on their own beings using a web cam. In order to use the Fashionista program, an online shopper needs to print out a marker and then follow the online steps to align the actual position with the web cam so that the clothes are sized correctly on the monitor. Zugara also released a streaming reality program called ZugSTAR which can be integrated with the Fashionista program. The streaming capability allows virtual contact between two people so that they can, in essence, shop together in a virtual world regardless of their real life locations.27
Some online retailers offer the stylists service wherein one could take a stylist's help and get answers to all queries.
The retail experience as they call it is not only important for physical stores but also online retailers. Retailers earn loyal customers by not only their product but also the kind of service they provide their customer, the retail therapy.
A recent online retail venture which has become the talk of the industry since its inception a year back is Fashion and You.
1.11 FASHION AND YOU: STAR RETAILER DEBUTANT OF THE YEAR 2010
In today's time and world, when everyone is becoming fashion conscious there is a desperate need of affordable fashion. Bargains and sales is what trigger most of us to go shop. At times we pick up stuff in bargains that we don't really need. During annual sales, the shopping experience turns out to be impulsive as well as compulsive. This attitude of shoppers works in favour of many brands.
Earlier retailers used discounts and bargains to attract shoppers but this was restricted twice a year - summer and winter sales. Now that the retail is becoming more and more organised with luxury brands venturing into Indian retail market, there was a gap in the market. Luxury retailing is fairly a new concept for Indian Consumer and the sales are not whopping. Hence the gap - luxury fashion at affordable price was formed.
Pearl Uppal and Harish Behl considered this gap as an opportunity and launched Fashionandyou.com on January 7, 2010. This was the third venture in this category but today it leads online retail in India. It's an online discount store that offers discounts up to 80% on various fashion and lifestyle brands.
A member only e-commerce portal, whose USP is the high discounts and new banners to offer every day. The innovative concept behind the success of Fashion and you is to offer an online discount store to its customer and help in liquidation of old stocks for its supplier. As the famous English proverb goes it killed two birds with one stone. It gave the customer - convenience of anytime anywhere shopping with an additional advantage of BARGAINS, and the suppliers/brands got away with their old stock that they were unable to sell otherwise.
It has lot of other customer attractions that boost the sales. In January 2011, to celebrate its anniversary, 2 week long events like:[email protected] for Rs11 only, Fortnight Frenzy, Happy Hours, Secret sales etcetera were held. It started with a Weekend Party where every 11th shopper won something special.
Graph 1: Daily Traffic Rank Trend at Fashionandyou.com
The above graph depicts the increase in traffic of Fashion and you on a daily basis in the past one year since its inception. They have around 1million members as of today and are growing with each passing day.
As per the inside source, it was confirmed that the company has registered sales of 5.5crores in Jan 2011 as compared to sales of less than 10lacs last year same time.
1.11.2 FUTURE PLAN
If Pearl Uppal's statement is to be believed this year is going to bigger and better, she said, "Fashion and You offers its consumers and clients a pan-India marketing, retail and distribution platform for fashion and lifestyle brands. We believe we are creating a shopping revolution in India and the investment from Sequoia Capital gives us the tremendous impetus that we require right now to leap into a growth spiral. We have committed to deepening our partnership with brands in delivering a world-class direct to consumer marketing and distribution platform, helping brands build a pan national footprint."29
They definitely have made a mark in the Retail world and are on the road to create a revolution in online retailing.
1.11.3 Questions for further discussion:-
How has retail scenario changed over the decade?
What are the gaps in the market or opportunities for future ventures?
Who are the competitors?
How fashion and you gained the competitive edge over others in terms of customers as well as suppliers?
In your opinion, how it can maintain the lead?
Decision - making
Virtual dressing room
What are the personality traits of a successful entrepreneur?
Choose one entrepreneur that inspires you and advise what is so unique about him/her?
Discuss the ventures of the entrepreneurs and analyze them on the following criteria -
Strengths / USP
Divide the class in groups of four, study about an entrepreneur from the fashion industry and present a case in the next session.
Select entrepreneur who failed in his/her venture and discuss how you would have done things differently to make it work.
"Some Entrepreneurs Succeed and Somebody Not - Why?" - By Dragan
Retrieved on 27-Feb-11
Work Life Balance of Entrepreneurs - By Dragan
Retrieved on 27-Feb-11
Small Giants: Companies That Choose to Be Great Instead of Big-By Bo Burlingham
The Knack: How Street-Smart Entrepreneurs Learn to Handle Whatever Comes Up- By Norm Brodsky and Bo Burlingham
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<http://www.qas.com/company/data-quality- news/online_fashion_retailers_set_for_growth_in_2011_6722.htm> (23-feb)
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