THE DHANDA IS NOT MANDA!

Another season of WIFW ended a week ago. And while I could talk about some great design and emerging trends, the focus of this piece remains the business generated at this trade event.

Now before I start, here are two disclaimers. First, the designer fraternity is not forthcoming about numbers. They don’t have to be, they are all private businesses. Second, the percentages mentioned are approximate only, since these were shared on the last day of WIFW and even though they have a fair idea, lots of math needs to be done before designers arrive at exact figures.

If you’ve been following my blog (thanks!) you already know that a large number of designers are happy to report a rise in orders from domestic players. In general too, business has increased and in some cases been status-quo. No decline for anyone (at least no one shared it!) and that’s always heartening to hear.

Gaurav Gupta reports a rise of 30% in business this season. For Rajesh Pratap Singh, the growth has been 20% and for Abraham & Thakore 25%. Meanwhile designer Varun Bahl says he’s seen a 100% jump in business from last season! Ahem, Ahem!

What’s common to most designers is that their domestic buyers have placed more orders than before.

For instance, for Gaurav Gupta domestic players on an average have increased their order size by about 40%. For A & T that figure stands at 25%. And there’s a reason.

Domestic retailers themselves are in expansion mode. And as they go on inaugurating stores in even non-metros, the consumption of designer wear is growing. Hence, the number of orders.

Designer Kavita Bhartia says that although more domestic stores are placing orders, the order size remains small. The high churn in the business still comes from exports for her. Anupama Dayal also is more dependent of foreign orders for the balance sheet to smile back at her.

Another point to note is that the domestic buyer is definitely coming to the rescue of developing talent. I spoke to two Indian buyers who have 2 stores each in Delhi and Bangalore respectively.

They both explained how they prefer working with younger talent since being small players, the stores get more bargaining power and plus the younger guys are more ‘eager to please’, ‘stick to deadlines’, ‘are willing to adapt’, ‘give the buyers respect’ etc etc… It’s a win-win situation. In the early stages of the business designers don’t really have the infrastructure to deliver huge volumes which are required by foreign buyers. So smaller orders from smaller Indian buyers are just what the doctor ordered.

While the rise of the Indian buyer is one part of the story this WIFW, the other is the money power of the Middle East. There wasn’t one designer I spoke to who didn’t mention Middle East as an important/active market. So that’s where we’ve arrived as a sourcing hub and plan to be planted until China gets into Indian embroidery (which I hope is never!)!! The other significant mentions came for Japan, Singapore and Hong Kong. (More power to Asia I say!)

To wrap up, for the past 3 years India has been the shooting star of Asia. Whether it’s the world’s best luxury brands or high street players, everyone is making a bee line to cater to the Indian customer. While some have always known it, many Indian designers are now realising that India is where the focus needs to be. And it’s not just about focussing on the Indian buyer, it’s also about looking at the best that traditional India has to offer and adapt THAT for the modern Indian.

MIDDLE EAST OR THE WEST? FORGET IT, INDIA IS ALMOST THE BEST!

It’s been a pretty hectic day 4 at WIFW for me. Have spoken to so many designers with many different points. My initial thought was to find out how business has been for those designers who don’t typically cater to the Middle Eastern market because that’s where a majority of buyers are from this season. I say ‘typically cater to’ because a Middle Eastern buyer, it is assumed, is looking for elaborate hand embroideries, loud colours, statement making embellishments.

But here’s where we could be making a wrong assumption. You wouldn’t think that Kallol Datta’s deconstructed silhouettes and clock prints would generate interest from a Middle Eastern shopper. But Kallol himself has been pleasantly surprised by the enquiries from the region.

Paras Bairoliya from Geisha designs too has booked orders from stores in Kuwait and Dubai. Their collection this time is about understated elegance and sexy subtleness.

So clearly the Middle Eastern buyer is looking for more than what we typically assume from them.

Now the next question, where are the buyers from Europe and the US? We’ve just been talking about the Middle Easterners haven’t we?

Kevin Nigli from Abraham & Thakore explains. “The buying season for autumn-winter is January-February, at best March. April is a little late and the buyers’ budgets have already been exhausted,” says Kevin.

So is not having enough European and American buyers a big miss? Not quite as I understand from the designers I’ve been speaking with.

Paras and Kevin both elaborated on how the lingering jitters of the global recession have meant fewer buyers from Europe and the US in the past 2 years. Even if buyers from the region come here, their budgets are considerably smaller OR they are stocking their Middle Eastern stores because that’s where the money and the willingness to spend it both exist!

The other reason that one doesn’t miss the aggressive interest from the US and
Europe is because the Indian market itself has grown tremendously in the past 3-4 years. So designers who were earlier looking at bulk exports are now reassessing priorities to cater to the domestic market, sometimes at much better revenue margins.
Kevin says that “We don’t need to look at the West anymore. Actual buying in India is very strong now. The process of buying has also become more professional with appointments being taken in advance etc. Buying patterns have now completely changed.”

70% of A & T’s revenues come in from the domestic market. The figure stands at 60% for both Gaurav Gupta and Geisha Designs and 90% for Shantanu & Nikhil.
Many other designers I spoke with said that even though the larger revenue chunk still comes from international buyers, the balance is tilting towards the domestic market with every passing WIFW.

As the fashion economy itself grows in the country, the designer pie will automatically grow. So for the moment as designers shift eyes from the Middle East to the west, very soon they will be saying the Indian buyer is certainly the best!

WE LOVE BEING IN THE MIDDLE!

So as the official ‘observer of the business of fashion’ here at WIFW, yours truly has spent a lot of time in the exhibition area. That’s where the soul of this event lies because at the end of the day, the ramp may provide the glamour but the trade, the paisa vasooli happens in the exhibition booths.

And if I have one observation from my several jogs around the booths, it’s that a majority of buyers this season are from the Middle East.

I chatted with one of the ‘small’ buyers from Kuwait. ‘Small’ because she owns only one store. By the second day of the WIFW she has already placed a 50 piece order from a popular designer and she said, probably orders for about 300 pieces will be placed by the end of the week. Yes the number is not huge but what makes this order significant is that this buyer has picked pieces high on embellishments and has picked them at good prices… margins would be great for the designer.

But it’s not just solo store owners. I hear that at least two buyers from the Middle East shopping at WIFW own upwards of 50 stores across the region. So the designers who crack these buyers will be celebrating Christmas before its time!

Here’s the reason why a majority of international buyers are from the M.E (Middle East!) this season. Store owners in the region are stocking up for Ramadan festivities which start August first this year. I don’t need to tell you how important this season is for business in Islamic nations. If store owners want to sell well during this season, festive collections need to be in store by July and which means orders need to be placed immediately in India.

But why India?

Designer Jatin Verma has bagged 6 separate orders from the region and the volumes are massive. By July his clothes will be in stores across Riyadh, Jeddah, Bahrain, Doha and more cities in M.E. It’s easy to see why. Walk into his booth and you know the collection on the racks has been consciously designed for that market. Long capes, gowns, the traditional jalabias in bright colours and look-at-me embellishments would invite anyone from M.E inside.

Jatin says that customers from M.E like a lot of things that we Indians do. So whether it’s our vibrant colours or the embroideries, “it’s easy to adapt” to their requirements that are largely about more conservative silhouettes. But no, it’s not always about the long capes… it’s also about the super sexy evening gowns that are worn inside of the jalabias. (Jatin showed me one, and boy was it sexy or what!)

Designer Kavita Bhartia, who is known for modernising Indian craftsmanship, agrees that the sensibilities are similar. “They have a similar mind set, their lifestyles are similar, they love hand embroideries,” says Kavita.

Well it’s not difficult to see the similarities. But does that mean that if you as a designer are not about embroideries and embellishments, you’re not doing much business at WIFW this season? Well that’s what I’ll find out next. This piece was just about being happy in the Middle…. East!

NOT JUST AN ACCESSORY TO THE FASHION BUSINESS!

“I’m going to wear that dress with those shoes and that clutch.” That’s how I think of dressing up. Like a zillion other fashion savvy women in the world! Accessories are integral to fashion. And we are willing to spend as much, if not more, on them. Point is there is money (pots of it!) to be made from the fun things we label as accessories.

18 accessory designers are part of WIFW this year. And they really are adding that delicious cherry on the mouth- watering business opportunity that this trade event presents.

Pinky Saraf started her label PVS Bags & Accessories 4 years ago and after tasting the fashion week last season, she is back to impress in this edition. I asked her why? “There has been so much exposure to international buyers. Even though I had international presence earlier, now my label is present in 8-10 countries. Imagine the confidence you feel when you see your bag at Madison Avenue!” says Pinky.

While the European and US markets are still recovering from the lingering impact of the 2008 slowdown, a lot of business is coming in from the Middle East. In fact, “about 50% of the business is generated by the Middle East buyer,” adds Pinky.

The rising orders and the added platform of this trade event have meant that year-on-year Pinky’s business has seen a growth of 75%. The base may have been small to begin with but then this kind of growth is what a developing business requires.

While PVS Bags & Accessories is largely focussing on international buyers, fashion week first timer Puja Duggal is looking at breaking into the domestic footwear market. “We have 25 years of export background and now we are looking at establishing presence on the domestic circuit,” says Ratul Duggal, the business brain behind this creative start up.

But hey if you’re making buckets by selling to some of the best brands in Europe, why do you care about selling in India, I ask. Ratul gave me three very good reasons. The first, retail in familiar territory is important to expand your business. The second, markets abroad have been terribly jittery is the past 2 years. And the third is the 90 day payment gap between international buyers and desi exporters. “When margins are thin anyway, 90 days is a long time to rotate the capital you invest in producing the goods,” explains Ratul.

Additionally, many international brands have developed local buying houses in the country and it’s a smart idea to target them, especially when your production infrastructure is in place. So Ratul is hoping that he can lure desi buyers by offering a high on quality product that is competitively priced.
Now clearly the two design labels above have come in with a clear business strategy. Two other first timer accessory designers at the fashion week are hoping to get exposure and generate business in equal parts.

Adi-kriti is a Kolkata based label that produces 22 carat gold jewellery inspired by tribal lifestyles. “We want to showcase our product to the designer fraternity,” says the director of the label- Rupak Saha. This he feels will help in generating future partnerships and national retail tie ups.

Rashmi Dogra from Mumbai focuses on artistic handbags that are unique since each one is hand painted! Rashmi is at the event for some ‘great visibility’ and she hopes to make her two year old label popular with domestic buyers to begin with.

Clearly, all accessory designers are here for one reason or another… and together they hope the outcome is the inflow of some (or a lot of) moolah! And yes… there is one wish that’s common to all…and that’s to be part of the runway action, the next time they add-on the ‘fun stuff’ to WIFW.

BUSINESS TIPS FOR EMERGING TALENT IN FASHION!

Its India’s biggest fashion event and it certainly means business. The Wills Lifestyle India Fashion Week has once again brought together a vibrant mix of designers (141, the highest ever!) to showcase to around 200 buyers from across the world.

77 designers are showing on the runway and this includes a lot of young talent, quite fresh to the glamour of a runway show and new to the business of fashion. They are high on creativity and enthusiasm but like any entrepreneur, setting the foundation of their business isn’t an easy task.

So in this piece we try to help them, through the advice of seasoned designers who are also smart businessmen. What is it they can do to not just get clicked but also set the cash registers ringing?

Let’s begin with what’s most exciting for an emerging talent- their clothes on the run way!

As important as it is to make a statement, it is even more important to show your creations to the BUYER. For that Rahul Khanna, from the designer duo of Rohit-Rahul says “Editing out your pieces for the show is important. You don’t have to pick ALL the pieces you’ve created. Showcase the best and remember to establish a relationship between the first piece on the catwalk to the last one.”

Rahul also suggests that line sheets and a note on the collection must be handed over to buyers before the show. These help the buyer in identifying what they like and the gesture shows you are serious about the business.

Designer Anupama Dayal feels that most emerging talents go wrong with the silhouettes they present on the ramp. “Few women are a size zero. No woman wants to wear tight, look-at-my-body clothes. Make the practical side of life glamorous. Design has to be functional.”

True that. What a buyer wants is clothes regular people with a sense of style will buy. And if you want to cater to a larger market, it’s important to show silhouettes that are not discouraging.

Both Anupama and Rahul feel that young designers need to think through their collections before they actually start putting them in production.
For instance if pret is your focus, Rahul says “decide the price points and then work backwards… which means think before going all out with applique or embellishments because that means your cost will shoot up.”

Anupama cites an interesting example. “My favourite colour is white. But do you see a lot of white in my clothes?” … Her point is that before starting production you need to know what will last through the process of mass production...Quality control is extremely important if you want a buyer to come back to you with business.

It may seem like a challenge to adapt your creativity to the demands of the market. But as you discover your own signature style and build on it, it becomes easier to identify your niche. So as an emerging designer, while you must enjoy the compliments and the adulation, remember that the ones who really last in the industry, are the ones who hone their entrepreneurial skills as much as they nourish their creativity.

READY TO SEE MORE OF FERAGAMMO IN INDIA?

So its common knowledge that the best fashion brands are either French or Italian. One of the stars of Italian design and quality is brand Salvatore Feragammo.
The craftsman of the same name started designing and hand sewing shoes from age 9 in Naples. By 1923 he was popularly known as the shoemaker for the stars and had located to Hollywood. Salvatore died in 1960 at the age of 62.

By that time the brand was known globally and the foundations of a global luxury empire had been laid. His wife and six children more than capably took the business to another level. An article in the World Street Journal quotes the 2010 net profits of the company at 60.8 million Euors, compared to a net loss of 14.7 million Euros reported in 2009. Sales rose 26% to 781.6 million Euros from 619.6 million Euros a year earlier.

Recently I had the pleasure of meeting Fulvia Visconti Feragammo. She’s the daughter of the visionary designer and also a member of the company’ board. She said that India accounted for just 1% of the global sales figures for the company in a year when the Asia Pacific itself accounted for 51% of total global sales. So clearly India remains a miniscule market even though since its 2004 debut, four stores have been established here.

Now if you’re instantly assuming that China is a big contributor to those sales, you’re right! But Ms.Feragammo says comparing the two markets is unfair.“ It is difficult to compare the two markets. In India we entered 5 years ago whereas we entered China 25 years ago,” she says.

Fulvia Feragammo started the silk accessories range for Feragammo. And in fact in India, these products, like ties and scarves, have worked well as samples of the larger brand promise.

“These are impulsive buys. They are presents and just colourful, happy products. So they sometimes introduce you to the brand. People who don’t know you, they come see these products, buy them and then discover our core business… the shoes and the bags,” says Fulvia Feragammo.

Not just that. In India, she feels accessories are in big demand. “They’re the first things Indian ladies can buy. With beautiful Indian clothes, our beautiful accessories match very well.”

Isn’t that a telling statement on how an international luxury brand can approach our market? I mean for you and I, it’s easier to buy and wear a Jimmy Choo than fit into a Christian Dior gown which will require customisation to some extent and of course costs more than an accessory. Price apart, luxury apparel is used for very special occasions whereas a bag or shoe may be used more frequently.
In fact Fulvia Fergammo is sure that because the demand for good accessories is high here, India may be the 5th largest market for Feragammo by 2020.

While my conversation with Fulvia Feragammo was largely about the brand and its India business, I couldn’t help as a question many Indian designer may think of. Like them, Feragammo has never allowed outsider money in the business.
Ms.Feragammo had a smile on her face while answering this. “Our generation has grown up like this. We have believed a lot and worked very hard for our company. So far we were six of us brothers and sisters. We’ve got along very well because we head different areas of the business and there has been no overlap. We have kept it together preciously. Now we have many children and grandchildren so the future may be different.”

Let me explain why that smile is telling. Speculation is rife that the company is indeed going for an IPO later in Italy this year. In fact some stake in the Hong Kong arm of the business has already been sold to someone Ms.Feragammo feels is a friend. She shared with me that while getting investor money can stupendously help in rapid growth, sometimes it’s just wiser to believe in your own vision of your product and grow its business slowly but steadily. Because it is difficult to find someone who will love the product as much as you, as its creator, will.

As I finished my conversation with Ms. Feragammo, I couldn’t help but feel a little sad. Perhaps it’s something I sensed from her as well. Very soon, Salvatore Feragammo may not be a family business. In a funny way, it’s like letting your kid married. You know you’ll always love it unconditionally but there is no more guarantee if it will really need you anymore.

In both life and in business, moving on can be an emotional reality.