Consent to act as Thesis Guide
I, Prof. Rajiv Joshi working as an external faculty in the Indian Institute of Planning and Management, express my consent to act as a guide to Mr. Viral Shukla (Batch: PGP/FW/07-09/A/FIN). He has expressed his interest in writing a thesis on "Apparel Retailing in India: Problems and Prospects - A study with focus on Menswear" and has requested me to guide him through the same.
This is to inform that I shall support him as a guide for his thesis on the above mentioned topic and share my knowledge and help in all ways possible.
With warm regards,
Prof. Rajiv Joshi
Associate Faculty At Entrepreneurship Development Institute Of India,
External Faculty (Indian Institute of Planning and Management)
One can not survive alone. In the same way competition of any task would be hard to complete, one needs to guide him or help. So I would like to thank Indian Institute Of Planning and Management (IIPM) for providing me the opportunity to work on the thesis.
My sincerest appreciation must be extended to my thesis guide Prof. Rajiv Joshi, for giving valuable and important guidance, time, efforts and direction to write something fruitful. I always thought that I have given the best shot, but after sharing with Mr. Joshi, I always found that there is still better shot remaining. I am very much sure that this work would not have been possible without Mr. Joshi. I am also thankful to Prof. Pabitra Ranja for their assistance in making the possible.
This thesis does not include my individual analysis; there have been many people from the industry who have helped me in gathering data, giving insights & opinion. So I would like to thank ..........Lastly I would like to thank all my friends, professors & family member for helping me in some or the other way for getting my thesis done.
Objective: The basic objective of the thesis would be to know the retail market in India and also in that to know the especially the men's wear category.
Retail Market: The Indian retailing industry, which was traditionally dominated by small and family-run stores, has come of age. The retail sector is the second largest employer after agriculture in the country and also the second largest untapped market after China. There are some 12 million retail outlets in India.
Besides, the country is also dotted with low-cost kiosks and pushcarts. Organized retailing is only 2% of the total retail industry.
At the turn of the century some retailers would have a storefront where people could browse, and new pieces being sewn or customized in the back rooms. Among the few players who have been catering to the branded market are Park Avenue, Liberty etc. it took a quite long time for brands such as Allen Solly and Van Husen to create a respectable market share in the ready to wear market.
Big players like Tata, Raheja, Bivani etc have intensified the competition with their professional retail chains like Pantaloons, Westside, Shopper's Stop. Recently, India is increasingly being looked upon as a major supplier of high quality fashion apparels and Indian apperals have come to be appreciated in major markets internationally.
The methodology would be:
- Primary research:- Questionnaire (Sample size 5), Interviews of prominent personalities from the industries and also 50 questionnaire for the consumer.
- Secondary research :- With the help of Secondary data collection sources like internet, journals, magazines and case studies etc.
Scope of Thesis
- The thesis would serve as an understanding of Retail market in India and especially in menswear...
- This thesis would also help to know about the Consumer Buying Pattern in this industry and also to get knowledge of the consumer when they are going for the menswear (means what they are looking for...)
- It will give me an idea about the forces that drive the sales in this industry.
This thesis will not only be useful for exiting player's but also for academic purposes.
The retail sector in India is witnessing a huge revamping exercise as traditional markets make way for new formats such as departmental stores, hypermarkets, supermarkets and specialty stores. Western-style malls have begun appearing in metros and second-rung cities like introducing the Indian consumer to a shopping experience like never before. The sector is at an inflection point where the growth of organized retailing and growth in the consumption by the Indian population is going to take a higher growth trajectory. The Indian population is witnessing a significant change in its demographics. Organized retail is on all time high in india. The growth is boosted by various funding options, regulations like Vat implementation to make process simple, sea change in demographics of country and international exposure.
Men's apparel market is 46 percent of the total apparel market in India. Preference for readymade garments is increasing and this has become inevitable with the rise in urbanization. Whereas. Women's apparel market is 17 percent of the total apparel market in India. The preference for the branded western and Indo-western apparels among the working women is on the rise, which is a welcome relief for the manufacturer and retailers of branded apparel. The dressing habits are getting refined if not changed specifically among the working women. Kids' apparel is 37 percent of the total apparel market. Being the branded penetration in this segment lowest at 9 percent shows a lot of potential for the branded players to exploit this segment. The apparel market will be thrown to open competition in the year 2005, due to of multi-fiber agreement. Then there will be lots of demand in the western countries. After China, India is being perceived as the next country with the biggest 'Growth Potential' due to its cheap manpower and natural resources. The first decade of the 21st century will witness India as the major player in the apparel business- partly because more industrialized countries like Korea, Taiwan etc. have moved into other industries- are partly because the Indian Government believes in, and wants to grow the apparel export business, since it is a major earner of foreign exchange for the country.
The history of textile in India years backs in 3000 BC the use of mordent dyes and printing blocks. The diversity of fibers found in India, intricate weaving on its state of art manual looms and its organic dyes attracted buyers from all over the corner of the world from centuries. The British colonization of India and its industrial policies destroyed the innovative eco-system and left it technologically. Independent India saw the building up of textile capabilities, diversification of its product base, and its emergence, once again, as an important global player. Today, the textile and apparel sector employees 35.0 mn people (and is the second largest employer), generates 1/5th of the total export earnings and contributes 4 percent to the total GDP there by making it the largest industrial sector of the country. This textile economy is worth US $37 bn and its share of the global market is about 5.90 percent. The sector aspires to grow its revenue to US $85 bn, its export value to US $50 bn and employment to 12 million by the year 2010.
In India, clothing retail accounts for 36 percent of organized retail business. It is the largest sector. Ready made apparel accounted for a estimated 20 percent of domestic clothing sales in 2005. With growing working women wearing western wear going to work and pressed for time and market for good ready made clothes is likely to grow. Indian population crazy behind the films and his actor and actresses, so they follow their style statement. They affect various sectors of the market including clothing, footwear, weddings and fashion accessories. With the advent of modern format retailers and the growth of plastic cards, affluent urban Indian women are shopping like never before. These are designer clothes that incorporate Indian motifs, ethnic fabrics and are a fusion of western and Indian style.
In the large urban centers, apparel retailers like Shoppers Stop, Westside and Pantaloon have popularized their private labels, which have attracted urban shoppers. Westside carries only its own private labels, while for the others 10-30 percent of their apparel turnover is from private labels. Customers have loyalty to a store rather than any particular garment brand. This has led to a thriving unbranded or local brand market for ready to wear clothes leading to severe competition.
According to a report by data monitor (2006), global apparel, accessories & luxuries market is likely to grow by 4.5 percent annually and Asia Pacific region is anticipated to acquire leadership position by 2011. Apparel sector in India poses a lot of challenges to a marketer. So far india's share in the world apparel trade has been insignificant (less than 3 percent). World garment trade is estimated at around 195 bn US$ annually. The biggest manufacturer & supplier is China producing over $ 50 bn, followed by Mexico which produces over 8 bn and followed by many countries like India, Sri Lanka and Bangladesh, being the third place countries making and exporting garments worth 5-6 bn$ annually.
Retailing format in India
These are the basis outlets or structure of the Indian retailing. Before 21st century there was only convenience stores, departmental stores and some where places there was also specialty stores. But now its totally change the face of Indian retailing, came with the malls, hypermarket, discount stores and mob's.
The largest from of organized retailing today. Located mainly in big cities of the country and metro cities, in proximity to urban outskirts. Ranges from 50,000-60,000 sq ft. and above. They lend an ideal shopping experience and environment to consumers with an amalgamation of products, service and entertainment, all under a one common roof.
Example: Pantaloon, Westside, Shopper Stop's, Reliance Mall
It's like chain of stores. Generally it's around 400 to 500 sq ft. They are focusing on specific market segments and have established themselves strongly in their sectors.
Example: Planet Health, Planet M, Crossword etc.
As the name suggests, discount stores or factory outlets are one or same, they offer discounts on the MRP through selling in bulk reaching economies of scale or sell excess stock left in their showroom.
Example: It's like a Nike Factory Outlet, Adidas Factory Outlet
Large stores ranging from 20,000 to 50,000 sq. ft., catering to a variety of consumer needs. Further classified into localized departments such as clothing, toys, home groceries and home appliances etc.
Since launch of the hypermarket/supermarket are change the face of the retailing in India. They brought retailing onto new era or dimension to the retail industry in the world and in India both. Consumer can find anything whether is grocery, apparel, home appliances anything they get under one roof. Supermarket/hypermarket contributed almost 30 percent. Hypermarket/supermarket ranging is from 30,00 to 50,000 sq ft.
Example: 6Ten, More, Subhiksha
Multi Branded Outlets:
Multi branded outlets has become very popular now days because of so much rush in mall or hypermarket. Now consumer is prefer multi branded outlets because its save times and they can get more variety than the mall and any other shopping area. And its ranging is around 1000sq. ft.
It is estimated that the over 65000 garments retail store in the organized sector of retailing of which about 88 percent are for woven cloths while remaining are for knits. However, only 30-40 units are large in the size. While these firms are spread all over India like Mumbai, Calcutta, Chennai, Cochin and Ludhiana employing aboun 3.5 mn people. The total value of production in the garment sector is around rupees 1050 to 1,100 bn of which 81 percent comes from the domestic market. The value of Indian garment is around 200-300 bn rupees. About 40 per cent of fabric garment product is imported and also it's expected further rise in near future.
The weaving and knits sector are known as the heart of the Apparel industry. In 2004-05 the total production from weaving sector about 46 per cent was cotton clothes, 41 per cent was 100 % non-cotton including silk, khadi and wool and 13 percent was blended clothes.
There are three type of technology used in the sector handloom, power loom and knitting machines. And they also represent unique supply chain. The handloom sector includes khadi, wool and silk. They serves the low and the high ends of value chain for both rural and urban market. Handloom production in 2003-04 was around 5493 mn sq. mtr. of which about 82 percent using cotton fiber. Mostly handlooms production is done at rural areas because people of rural area has master in handloom item. It's employing almost 10 mn.
Weaving using power looms, was done by traditionally multiple mills. While like Arvind mills they have itself multiple units. In 2004-05 they remained 223 composite units that have produced 1434 mn sq. mtr. of cloth and mainly their units were in Gujrat and Maharstra. Knits have been more successful especially in export channels. It has well-built production cluster like Tripura and Ludhiana have led to growth of accessories sector.
Men's Wear Sector:
There are many brands specially in men's wear like Levi's, Lee Cooper, Gap, Allen Solly, Van husen, Provogue, Wills Lifestyle, Raymond, Peter England etc. Currently, few major business tycoons like Tata, Raheja group, Future group have heightened the competition with their professional apparel retail chains like Westside, Pantaloon, and Shopper's Stop. Now India is going to become hub for men's wear with high quality fashion. Internationally Indian market is appreciated now days and many major groups are trying to entering in to Indian market which is full of potential and still untapped. It is worldwide facts that India is the 2nd largest apparel market after China owing to it's easily availability of manpower and with the cheaper cost and with natural resources. Men's wear categories contributed almost 46 percent of the total apparel industry contributes. So its clearly identified that still it has big potential. And also because that in India men's are more than children and women their ratio is far more ahead than the both. Men's wear included casual clothes, trousers, shirts, formal shirts as well as trousers and inners. Men's shirt and trousers both are contributed equally of 40%, casual clothes are included Jeans, Sports wear etc. and they are contributed almost 45%. And inner is almost 15%.