Journal of Fashion Marketing and Management: An International

Journal
The apparel aftermarket in India a case study focusing on reverse logistics
Nandita Abraham

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

Article information:
To cite this document:
Nandita Abraham, (2011),"The apparel aftermarket in India a case study focusing on reverse logistics",
Journal of Fashion Marketing and Management: An International Journal, Vol. 15 Iss 2 pp. 211 - 227
Permanent link to this document:
http://dx.doi.org/10.1108/13612021111132645
Downloaded on: 06 August 2015, At: 11:29 (PT)
References: this document contains references to 48 other documents.
To copy this document: permissions@emeraldinsight.com
The fulltext of this document has been downloaded 2227 times since 2011*

Users who downloaded this article also downloaded:

Michael Bernon, Silvia Rossi, John Cullen, (2011),"Retail reverse logistics: a call and grounding framework
for research", International Journal of Physical Distribution & Logistics Management, Vol. 41 Iss 5 pp.
484-510 http://dx.doi.org/10.1108/09600031111138835
Samir K. Srivastava, Rajiv K. Srivastava, (2006),"Managing product returns for reverse logistics",
International Journal of Physical Distribution & Logistics Management, Vol. 36 Iss 7 pp. 524-546 http://
dx.doi.org/10.1108/09600030610684962
Mario Turrisi, Manfredi Bruccoleri, Salvatore Cannella, (2013),"Impact of reverse logistics on supply chain
performance", International Journal of Physical Distribution & Logistics Management, Vol. 43 Iss 7 pp.
564-585 http://dx.doi.org/10.1108/IJPDLM-04-2012-0132

Access to this document was granted through an Emerald subscription provided by emerald-srm:589965 []

For Authors
If you would like to write for this, or any other Emerald publication, then please use our Emerald for
Authors service information about how to choose which publication to write for and submission guidelines
are available for all. Please visit www.emeraldinsight.com/authors for more information.

About Emerald www.emeraldinsight.com

Emerald is a global publisher linking research and practice to the benefit of society. The company
manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as
providing an extensive range of online products and additional customer resources and services.
Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee
on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive
preservation.
*Related content and download information correct at time of download.

The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1361-2026.htm

The apparel aftermarket

in India a case study focusing
on reverse logistics
Nandita Abraham

The apparel
aftermarket

211

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

Pearl Academy of Fashion, New Delhi, India

Abstract
Purpose This paper aims to map and understand the reverse logistics systems in the apparel
aftermarket in India. It clarifies the processes involved from the procurement of used clothing until its
resale in the aftermarket. The paper identifies that collaboration between stakeholders can improve
logistics, business predictability and margins.
Design/methodology/approach In total, 93 in-depth interviews were conducted with stakeholders.
Questions revolved around strategic and operational factors of reverse logistics in the aftermarket.
Findings This fragmentation and isolation of stakeholders businesses is identified as the cause of
most stakeholder inefficiencies. It was found that benefits accrued by collaboration in the reverse
logistics chain are increased market knowledge, more predictable business and better margins.
Research limitations/implications Mapping and understanding of the reverse logistics were the
primary aims of this paper. Researchers are encouraged to look at a value-addition model based on this
paper which could help evaluate further business decisions. Additionally a study of the sustainability
aspects of this reverse logistics process would be a valuable addition to knowledge in this area.
Practical implications Collaborative initiatives can be used as a way to reduce multiplicity of
activity, increase predictability and expand business.
Originality/value This paper fulfills the need of understanding the apparel aftermarket in India and
how reverse logistics may be looked on as a tool to manage the post-first consumer apparel market.
Keywords Garment industry, India, Distribution management, Stakeholder analysis
Paper type Case study

Introduction
Logistics is the process of strategically managing the sourcing, movement and storage
of materials, parts and finished inventory through the organization and its marketing
channels in such a way that current and future profitability are maximized through the
cost-effective fulfillment of orders (Christopher, 1999) (Figure 1). Logistics has also been
defined as the processes involved in delivering goods to retailers and customers
(Graham and Hardaker, 2000).
Reverse logistics can be defined as the process of collecting used products and materials
from first customers in order that they may be reused, recycled, or upcycled into other
products. Reverse logistics treats these materials as valuable industrial nutrients rather
than trash (Krikke, 1998). In most cases, this includes distribution planning: physical
transportation of used products from first consumer back to a re-producer, inventory
management: sorting and management of used product by re-producer for conversion, and
production planning: actual conversion into marketable products (Carter and Ellram, 1998).
Reverse logistics in the aftermarket is a combination of traditional and reverse
logistics. The post-first consumer product is acquired, transported to a warehouse,

Journal of Fashion Marketing and

Management
Vol. 15 No. 2, 2011
pp. 211-227
q Emerald Group Publishing Limited
1361-2026
DOI 10.1108/13612021111132645

JFMM
15,2

Sourcing/acquisition of
raw materials

Inward
transportation
Traditional logistics

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

212

Materials
management

Transportation

Figure 1.
Flow chart of traditional
logistics

Warehousing and
distribution

inspected and sorted according to its potential use, reconditioned into useable product,
redistributed and marketed to a new target consumer (Figure 2).
Whenever the producers are not responsible for their end-of-use products, and recovery
value is low, land filling will be the final destination of such products. This is an
environmental hazard. In cases where disassembly and reconditioning costs overcome the
prices of new raw material, the process of recycling and shredding is preferred to cleaner
solutions, such as complete or partial re-using. In the recent past, the growth of
environmental concern has given the term reuse a new meaning (Dekker, 2006; Neumayer,
2003). The situations where reuse occurs are varied and can be categorized using criteria
such as reuse motivation, type of recovered items, forms of reuse and actors/organizations
involved (Fleischmann et al., 2004). Material cycles instead of one way economies are
promoted by waste reduction models (Hashimoto and Moriguchi, 2003).
Most research on reverse logistics is focused on automobiles, metal scraps, sales
packaging material, waste paper recycling (Stock, 1992; Kopicki et al., 1993; Flapper,
1996; Kumar and Putnam, 2008; Pilar et al., 2004). There has been research on reverse
logistics in the apparel industry (Tibben-Lembke and Rogers, 2002; Svensson, 2007) but
none of these study the Indian context. Additionally, there has been no research done on
reverse logistics in the apparel aftermarket in India, i.e. from when the product is
disposed off by the first consumer until it enters the aftermarket and is sold as apparel to
the next consumer. This study is of importance as a large part of the Indian population
survives on clothes purchased from the aftermarket.
This paper focuses on reverse logistics in the apparel aftermarket in India. In order to
do so, the present research has the following objectives:

First
customer

Used product
acquisition

Inward
transportation

The apparel
aftermarket

213
Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

Aftermarket
customer

Reverse
logistics in the
aftermarket

Sales

Inspection and
sorting

Reconditioning

Re-distribution

(1) To map the existing reverse logistics processes in the Indian apparel aftermarket.
(2) To document the processes and explore the benefits of collaboration and
entrepreneurship.
Review of existing research
This section aims at reviewing existing research in the subject area of reverse logistics.
It also looks at research on the reuse of clothing around the world. The section
concludes with a discussion of research done in India in the areas of reverse logistics,
used clothing, and the identification of a knowledge gap.
Research on reverse logistics
There have been many studies on reverse logistics and the motivation behind the reuse
of products. Reuse of products and materials is not a new phenomenon. Metal scrap
brokers, waste paper re-cycling, and the deposit systems for soft drink bottles are all
examples that have been around for a long time. Fargher and Smith (1996) and Kumar
and Putnam (2008) have researched cases where the recovery of used product is
economically more attractive than disposal. Cairncross (1992), Vandermerwe and
Oliff (1990) and Thierry et al. (1995) have studied the environmental motivation for
reuse of products.
The management of product within the supply chain for optimized recovery is also
the subject of many research papers (Stock, 1992; Kopicki et al., 1993; Fleischmann and
Kuik, 2003; Pilar et al., 2004). Fleischmann et al. (1997) review the use of quantitative
techniques on reverse logistics. Most of the research highlights a strong link between
product design and reuse options. In the apparel industry too, product which is designed
to last longer like denim jeans, tend to be seen more in the aftermarket and provide more
reuse options as will be discussed later.

Figure 2.
Flow chart of logistics and
reverse logistics in the
aftermarket

JFMM
15,2

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

214

Research on reuse of clothing in the global market

The reuse of clothing in the global market has been an area of interest to researchers
internationally. Rivoli (2005), an Economist, in her book maps the travels of a t-shirt across
continents from raw material to post-first consumer. This is an account of the supply chain
process around the world. The author studies global trade and market dynamics and their
influences. Kuchler and Miller (2005) looks at the reuse of clothing from a sociologists
point of view, relating it to material culture and belonging. While studying clothing reuse,
she argues that cloth and clothing are not superficial adornments but are living, vibrant
parts of culture and the body. Hawley (2006) presents a schematic map which depicts the
wide variety of textile recycling markets that are available for the sorted goods. Hawley
also presents a conceptual model that categorizes waste apparel and textiles and suggests
that an inverse relationship exists between the volume of goods and the value of goods.
She draws upon von Bertalanffy (1950), to apply the general systems theory to the social
system surrounding textile and clothing reuse and recycling. Koch and Domina (1999) has
explored post-consumer textile waste in the USA, textile disposal options and attitudes of
consumers and recommends organized textile recycling programs as a solution.
Researchers have studied used clothing markets in developing countries. Mhango
and Niehm (2005) identified opportunities for retail entrepreneurs in Malawi, Hansen
(1994), a socio-cultural Anthropologist, studied the relationship between used clothing
and identity in Zambia. Hansen (2000), in her book Salaula, has presented a detailed
description and analysis of the reuse of clothing in Zambia and the global and local
influences on the decision making of the consumer therein.
Research on reverse logistics in India
Most research in the area of reverse logistics in the Indian context study the systems of
goods return. Srivastava and Srivastava (2006) present a framework to manage product
returns for reverse logistics by focusing on estimation of returns for select categories of
products in the Indian context. Ravi et al. (2004) have analyzed the barriers to reverse
logistics in the automotive and computer industry in two different studies, Mondal and
Mukherjee (2006) have researched acquisition planning and related this with the
remanufacturing process. Norris (2005) work is the only available research on the used
clothing scenario in India. She has given a thorough account of the social relationships
that support this process and the cultural flow and new connectivities that result
because of it. Table I is a summary of the key ideas studied in the literature reviewed.
While there is plenty of published literature that explains or espouses reverse logistics
as a tool to handle returns, and parallely there has been research done on post-first
consumer apparel, there is a dearth of studies looking at reverse logistics as a tool to
manage the post-first consumer apparel market. There is hardly any literature on the
apparel aftermarket systems in India. The present research aims to fill that gap and to
explore entrepreneurial opportunities for improved economic gain. It discusses the current
Indian aftermarket context, followed by a mapping of its supply chain discussing the
systems and entrepreneurs involved.
Methodology
In order to fulfill the objectives of this paper, the author used primary research techniques
to map the post-first consumer logistics in the Indian aftermarket. Observations and
interviews with stakeholders were used to study the reverse logistics system.

Author
Literature on reverse logistics
Fargher and Smith (1996)

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

Kumar and Putnam (2008)

Cairncross (1992)
Vandermerwe and Oliff (1990)
Thierry et al. (1995)
Stock (1992)
Kopicki et al. (1993)
Fleischmann and Kuik (2003)
Pilar et al. (2004)
Literature on reuse of clothing
Rivoli (2005)

Key ideas
Reuse happens when the economic value of reuse is more than that of
disposal
Recommends remanufacturing in different industries
Environmental value of reuse
Environmental value of reuse
Overview of different alternatives of reverse logistics by occurrence
level
Management of reverse logistics
Management of product within the supply chain
Studies the process of network decision making
Link between product design and reuse options

Study of the clothing supply chain within the economics of

international trade
Kuchler (2005)
Clothing has a material value that is not equal to its monetary value
Hawley (2006)
Used textiles can be modeled into different categories for conversion
Koch and Domina (1999)
Implications for consumer textile recycling initiatives
Mhango and Niehm (2005)
Retailers in the Malawi used clothing market
Hansen (2000)
Reuse of clothing in Zambia
Literature on reverse logistics in India
Ravi et al. (2004)
Managing product returns
Mondal and Mukherjee (2006) Barriers to reverse logistics in automotive industry
Norris (2005)
Social relationships supporting used clothing in India
Srivastava and Srivastava
Suggest that commitment to improve supply chain efficiencies is
(2006)
required from all stakeholders and that Indian firms need to act fast
to be competitive

Initially, efforts were made to establish contacts with stakeholders. A pilot study was
conducted where the author had preliminary discussions with various stakeholders.
This study identified many levels of entrepreneurs performing different functions in the
aftermarket. Based on these findings an interview schedule was drawn up and rolling
exploration led to the mapping of the aftermarket. This can be seen in Figure 3.
Once this was done a selection of respondents was made from each stakeholder group
based on the authors judgment of their experience, reputation in the market and
willingness to share information (Table II). Next appointments were sought and
semi-structured interviews were conducted. To maintain consistency throughout the
interviews, the same procedure was used for each interview. First the interviewee was
given a short introduction. The interviewee was told that the interview was part of a study
on the systems in the apparel aftermarket. The interviewee was also told that this study
was confidential and carried out independent of any government organization.
Stakeholders, their organizations and markets were observed and interviews conducted
during visits over a period of three years. Questions asked to them revolved around
strategic and operational factors of reverse logistics. Part of the questions that were asked
were based on the review of literature, results from the pilot study and the authors
previous knowledge of the aftermarket. Further questions were exploratory and aimed at
getting a maximum understanding of the reverse logistics systems.

The apparel
aftermarket

215

Table I.
Summary of literature
reviewed

JFMM
15,2

Mapping of the reverse logistics functions in the

Apparel aftermarket
Stakeholder

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

Used clothing importers

Figure 3.
Mapping of the reverse
logistics functions in the
apparel aftermarket

Stakeholders

Table II.
Stakeholders interviewed

Indian
consumer

International used
clothing exporter

216

Used clothing collectors

Homemakers
Used clothing importers
Traders and distributors
Reconditioning agents
Pavement retailers
Aftermarket consumers

Function

Used clothing
collectors

Disposal

Product acquisition

Traders

Inspection and sorting

Reconditioning agents

Reconditioning and
product development

Traders

Distribution

Pavement retailers

Sales

Number interviewed
30
6
6
16
9
8
18

Analysis of interviews taken and visual mapping of products, services and value additions
were the key tools for data analysis as these helped to identify evidence of the reverse
logistics of post-first consumer clothing in the aftermarket in India. Interviews indicated
that the findings were representative of aftermarkets all over India and the products
available were the same as they originated mostly from New Delhi and Mumbai. Through
analysis this study identified various distribution channel activities and relationships.
This was followed by analysis of overall logistics and supply-chain practices. The purpose
was to gain a deep understanding of the reverse logistics process and to recommend
strategies to improve synergies. Finally, conclusions were drawn and suggestions were
made for future work.
Results and discussions
This section discusses the results of interviews and on-site studies conducted. The author
found that there are two different types of product acquisition systems which merge

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

into one (Figure 3). In the following section these will be discussed. The data have been
organized in the same order as it was mapped stake holders in the reverse logistic cycle
from the used clothing collector and the importer who acquire the product to the pavement
retailer who sells it in the aftermarket. Processes are as in Figure 2 (flowchart of reverse
logistics in the aftermarket).

The apparel
aftermarket

Product acquisition
Used clothing collector. The research found that central to product acquisition in the
reverse logistics process in India is a community known as the Waghri community. The
women of the Waghri community travel from house to house exchanging new steel cooking
vessels for old clothes. These women are commonly known as barthanwalis barthan
is a term in Hindi language meaning vessel and wali is a term used for lady. Most
barthanwalis reported that they have a fixed area for procurement although conflicts do
arise when they look for opportunities to increase business. They make their visits during
the day in order to catch the homemaker when she is free and available to enter into this
exchange process. They market their vessels to the homemakers and play down the value
of the incoming used products in order to get the best exchange value. During this
interaction the barthanwalis focus on the resale value of the clothes and they often do not
take clothes that are damaged. None of the homemakers interviewed had any idea as to
where these clothes were taken. Results indicate that product acquisition is not restricted to
locations where the rich and middle class communities live. The barthanwalis have
identified that poorer localities house women who work as cleaners and household help in
rich households, and that these are a good product source. Clothes which are no longer
wanted in the rich household and are of better quality are given as an act of charity by the
lady of the house to the people who work in her house. These helpers in turn further
exchange these hand-me-downs for new vessels brought by the barthanwalis.
At the end of each day, the acquired product is transported by the barthanwalis and
their spouses on cycles, buses and foot depending on the distance between the collection
route and their individual houses. The findings indicate that most often this is a family
business and each family had one to five procurers. Apparels are sorted according to
product category and expected value. No reconditioning is done at this stage.
A large plot of land near the residential area of the Waghri community has been
converted into a licensed open-air market where the barthanwali sells her product. On-site
observations were conducted here. At 3 a.m. (in order to get a locational advantage) the
acquired stock of the day before is brought to the market by the barthanwalis and their
husbands and put up for sale. Traders scout the market and sort and buy specific
categories of products childrenswear, menswear, denims, sarees, etc. The clothes are
then either taken to the traders warehouse or transferred to another portion of the same
market for further sale to other larger traders (distribution agents) who transport the
goods all over India.
By 10 a.m. this market closes. The barthanwalis use their earnings to purchase new
vessels and then proceed with them for their next set of procurement visits. The study
found that most barthanwalis had not much interest in where the garments were ultimately
sold and at what rates. Their focus was on their stage in the supply chain and turning their
stock around as fast as possible to earn money for their daily needs and the days business.
Used clothing importers. The second procurement route by which used clothing enters
the Indian aftermarket is through importers who buy used clothing and mutilated garments

217

JFMM
15,2

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

218

from developed countries. Government data indicate that around 219,000 tonnes of used
clothing is imported into India every year. These are procured in shipping containers each
weighing between 18 and 22 tonnes. The importer does the procurement from charity
organizations and recycling agents in mainly in USA, Canada, South Korea and Japan.
Of this around half is brought into the apparel aftermarket and the rest is used as raw
materials for shoddy yarn to make blankets and carpets. Container loads of used clothing
are transported from ports to distribution centres around India. On-site observations
showed vacuum-packed bales of 55-500 kgs. Further, trucks of unopened bales are
transported by wholesalers from these distribution centres to their warehouses.
At the warehouses, no bales are opened for inspection and they are further sold to
traders as is. Traders buy individual unopened bales and transport them to their own
stores which are usually close by. The study found that some smaller traders pooled
their resources to buy a bale and they later split the contents amongst them. Findings
show that the bales are mostly labeled, e.g. jackets, childrenswear, denim, t-shirts and
that the product in the bales is of the labeled category, but the quality of product is
unpredictable and some bales turn out to be less valuable than others. As per the traders,
bales from Korea would usually contain products with sizes more suitable to Indians but
bales containing jackets and jeans from Canada and the USA would sell at the highest
prices as they are large and there is more scope for their alteration and repair.
Interviews with the importers and wholesalers in the Indian apparel aftermarket
highlight the low level of control on the product variables sourced. Stock keeping units
were innumerable, quality unpredictable and they had to take what was delivered to
him in the bales.
According to the findings of this research, in both product acquisition channels, the
product acquirers resell their goods to the next stakeholder without any inspection or
sorting. This is done within a minimum lead time (one to seven days) and replenishment
is regular. Both, the barthanwali and the used clothing importer/wholesaler, sell their
goods as is to traders in the market. On-site studies show that at the next stage the
garments are inspected and sorted into categories as discussed below.
Inspection and sorting
Inspection and sorting is done by the traders who have bought the goods. There is hardly
any disposal at this stage as almost all products have a potential to be recovered in one
way or another. Investigation of their sorting methods showed that traders sort the goods
according to potential sale value and the amount of reconditioning required. According to
the traders these decisions are based on their experience and instinct. A study of the
process led to the development of a decision-making matrix (Figure 4) which shows the
sorting rationale and methodology used by the traders in the aftermarket.
Findings show that traders are aware of their market parameters and divide the
product that they receive based on their need for reconditioning and their value
potential, broadly into the following categories (Figure 4):
.
Low potential resale value high need for reconditioning. Those products which
have a very low potential resale value and require considerable reconditioning
are cut into strips and sold as wiping rags to machinery factories.
.
Low potential resale value low need for reconditioning. Clothing which has a low
potential resale value and do not require much reconditioning are sold as is to those

Need for reconditioning

Low
High

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

The apparel
aftermarket
Sold as rags

Reconstructed before
sale

219
Sold as is

Reconditioned/cleaned
before sale

Low

High
Value potential

pavement retailers who specialize in low fixed price retailing. Time and money is
not wasted on reconditioning as their potential recovery value is very low.
High potential resale value low need for reconditioning. Traders identify those
clothes which are in good condition and can re resold at a high value. These are
repaired and washed before resale.
High potential resale value high need for reconditioning. This category of products
are those which have a high potential resale value but need reconstruction.
Examples are jeans and trousers where the fabric has a longer life. These garments
are restitched, fake brand labels attached and repackaged with hang tags ready for
sale. All traders observed followed similar systems for decision making and similar
processes for reconditioning and reconstruction as discussed in the further sections.

Reconditioning
On-site studies show that there are varying levels of reconditioning that takes place in
the apparel aftermarket in India. This is primarily dependant on the potential sale value
of the product as discussed above and the entrepreneurial initiative of the reconditioning
agent. Some reconditioning agents work out of their houses with family members
participating as well. Others use the porch and pavement, while still others have small
manufacturing units and rent small rooms used as warehouses for their stock. Once
washed and cleaned the clothes are dried, ironed and ready to be sold further.
Minor reconditioning. When minor reconditioning is required garments are washed
with detergent and chemicals, critical areas scrubbed, repaired and ironed.
Major reconditioning/reconstruction. As analyzed in Figure 4, those garments which
have a high potential sale value after reconstruction (usually trousers) are cut, all trims
preserved and re-sewn into garments, often childrens wear or shorts, packaged and then
sold. Figure 5 shows the process of conversion of a pair of used jeans which has been
imported as scrap from the USA. In order for a product to be classified as scrap at customs
in the USA, it has to be mutilated in three places. The photographs show how the jeans
have been strategically mutilated prior to export in the USA. At the reconstruction site in
India, disassembly, recutting, stitching, dyeing, printing and packaging is done. Print
and embroidery has been used to improve value. The garments are tagged and packaged

Figure 4.
Reconditioning
decision-making matrix

JFMM
15,2

Mutilation
points

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

220

Deconstruction

Reconstruction

Figure 5.
Reconditioning of
importer mutilated used
jeans into childrens jeans

Value addition

Ready for resale

to enhance the presentation of the product. Once packaged, the garment is easily
mistaken for a brand new product.
Product development for increased value
Most pavement retailers interviewed were selling basic merchandise from undifferenciated
stalls and in order to get greater returns there was a need to differentiate their products.
They reported that with increasing exposure to television and movies, aftermarket
consumers were aware of national and international icons and trends. This influences
demand and therefore price. Sportswear and casual wear are the most aspired for in the
aftermarket. National and international sporting icons (mostly cricket and football) and
Bollywood heroes are viewed as fashion icons and the aftermarket customer like other
customers aspires to own clothes that will make him feel a part of that dream. On-site
studies showed that some stakeholders are using product development and packaging as
tools for product differentiation. This is done during the reconditioning process.
Interviews with these stakeholders indicate that apart from denim (which has a high
demand), products with a sporty look can be sold at the highest prices. Keeping this in
mind trousers including formal trousers are converted to look like knitted sportswear.
Figure 6 shows product where vertical stripes have been attached to trousers in order to
give them a sporty appearance improving their value. The on-site study showed that even
formal worsted woven trousers were elasticized to look like sportswear for this purpose.
Elasticized waistbands reduced the need for sizing. Strips of knitted cloth or tapes
were attached to transform old used trousers into fashionable sportswear. It could be

The apparel
aftermarket

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

221

Woven worsted
trousers converted
into sportswear

Note: a closer look shows black woven pants that are sold as sportswear

seen that fashionable looking brightly coloured labels and tags are also added to
enhance appeal (Figure 6).
Re-distribution
The re-distribution network for used clothing in India was mapped to be large and
fragmented. Most aftermarket retailers work individually. No common logistic company or
agent was seen. Usually, retailers purchase reconditioned goods from a reconditioning
agent or trader. The retailer keeps the goods in a room in his house or a warehouse in a
cluster or an outlet in a makeshift market. Some retail outlets are located in cluster type
markets allowing the customer to have increased options. Depending on the kind of
product and its condition, redistribution transportation varies from a hand carried bundle
to a loaded cycle to an open truck. The more organized distributors pack fully reconditioned
and packaged products into cartons and load them on to trucks. These products were found
to have the highest resale value. Freight rates reported were inconsistent and rising.
Sales in the aftermarket
Discussions with aftermarket retailers and visits to the markets confirm that informal
retailing is the only form of retailing in the apparel aftermarket. The pavement retailer
could belong to one of the many fixed pavement markets or could have a stall in one of
the weekly shifting markets (a market that shifts from neighbourhood to neighbourhood

Figure 6.
Product development done
in the aftermarket to
increase the value
of the garments

JFMM
15,2

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

222

on different pre-designated days). Similar formats are used in the aftermarket in

different parts of India.
Pavement retailers interviewed either put up a stall or sell their product from a
wheeled table which allows them mobility between and to and from markets. Most
retailers did not have a permanent schedule for setting up their stalls and often missed
market days when they were otherwise occupied and sourcing their products. They
reported inconsistent product supply and a high dependency on cash flow. The study
showed that their supply base was not permanent and the pavement retailers bought
what was available. The findings show that the demand for apparel varies through the
year with the highest demand being in the winter months (especially in the colder parts
of India). On the other hand, the rainy season has reduced sales and customer activity
due to the lack of facilities and infrastructure in makeshift markets.
The on-site study showed that nearly all sweaters and jackets sold on the pavement
markets are those retrieved from the import of scraps. Some pavement retailers have a
combination of used and new product to increase their consumer options. Higher prices
were charged for Western wear and often clothing was attractively tagged and presented.
Most customers reported having access to a shifting market where traders bring their
goods including plastics, fruits and garments. Some strata of societies buy all of their
belongings from these markets. Interviews with customers at pavement markets
showed that they were satisfied with the merchandise mix available. They looked at the
clothing as a fashion item irrespective of whether it was new or used. The on-site study
showed that price points were not fixed and bargaining was used as a way of clinching
the sale and developing a relationship with the customer. Aftermarket retailers like
the other stakeholders in the system had the desire to grow and make their businesses
more predictable and profitable.
The next section of this paper analyzes the Indian apparel aftermarket aiming at
identifying economically beneficial opportunities within the same.
Further discussions and opportunities for increased economic benefit
Through in-depth comparison between traditional logistics systems and reverse
logistics systems and mapping the aftermarket, the author found interesting
opportunities for increased economic benefits. Rostows take-off model has been used
to draw inferences and make suggestions. Rostow (1960), Sternquist (1997) and Huang
and Sternquist (2007) provided five stages of retail evolution that parallel phases of
economic advancement in developing nations. According to Rostow, development
requires substantial investment in capital. The five stages are described in Table III.
It has been observed that other researchers of the apparel aftermarket conducted
studies in countries where the apparel aftermarket is representative of most of the
apparel retail in the region (Hawley, 2006; Mhango and Niehm, 2005). In these cases
(Malawi, Zambia), trade agreements and government support have encouraged the
growth of the aftermarket trade and most products in the retail market are imported
from developed nations. This is not the case in India.
In India, the formalized retail market is much more developed than the aftermarket.
Formal retail is growing rapidly with malls burgeoning all over India and international
brands and Indian brands competing for share of mind and pocket of the consumer. There is
a growing focus on customer responsiveness in the organized sector. Apparel retailers
especially the larger ones are focusing on a higher degree of collaborations and partnerships

Stage Name
1

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

3
4
5

Characteristics

Retailing is characterized by selling unrelated assortments of

merchandise and a lack of ability to increase productivity. This is
basically attributed to the lack of infrastructure, technical knowhow, and capital. Vendors typically sell a scrambled merchandise
assortment with no marked pricing. All sales are negotiation based
Precondition for take-off A scrambled mix of merchandise is offered though retailers that are
situated in semi permanent structures
Take-off
Foreign firms are eager to enter, supermarkets emerge, there are a
few shopping centers, and entrepreneurial ventures are launched
(Sternquist, 1997, Huang and Sternquist, 2007)
Drive to maturity
The economy has technological and entrepreneurial skill. Both
organized and unorganized or traditional retailing coexist during
this stage
Maturity
High mass-consumption economy with large discretionary income.
This stage typifies retailing in developed countries (Sternquist,
1997)

The apparel
aftermarket

Traditional society

both in the upstream and downstream supply chain. Transportation and logistics are
getting attention and as a result some good third-party logistics service providers have
emerged. Batra and Niehm (2009) have applied Rostows retail developmental framework to
India and have positioned Indian retail at between Stages 3 and 4.
In comparison, the present research found that the Indian apparel aftermarket can be
currently positioned in Stage 1 traditional retailing. There are large volumes of
fragmented activity, multiple sources, parallel and varied channels and many small-scale
entrepreneurial ventures at work. The channel length is not controlled. Productivity and
efficiency are not considered and the time line from source to aftermarket retailer is
unplanned. The logistics channel and retailing is characterized by a lack of permanence
and consistency in terms of location, structure, merchandise assortment, pricing and
frequency of existence. There is no retail outlet in the aftermarket which has a permanent
structure. There is inconsistency in logistics, merchandise assortment and pricing. There
are no promotional tactics apart from price negotiation. The only move to increase market
share is some level of product development. Quick turnarounds are preferred to higher
margins and towards the end of the day sale at cost price is often seen.
All this is linked together by the inherent need for product and enterprise at the lower
strata of the Indian economy. There is a strong sense of pride and entrepreneurship in
traders and retailers in the aftermarket but most of it is isolated and confined to their own
business. Lack of finance and access to technology has ensured that the aftermarket has
not developed over the years.
Content analysis of interviews showed that most stakeholders in the reverse logistics
process functioned both as a buyer and a seller in the extended supply chain. When
functioning as buyers they all had similar issues with their suppliers (inconsistent
quality, low product differentiation, increasing transportation costs). When functioning
as suppliers they had similar issues with their buyers (no market information, low
prices, uncertain demand). These have been summarized and listed in Table IV.
Further analysis of Table IV indicates that most issues relate to fragmentation and
isolation of stakeholder businesses in the reverse logistics chain.

223

Table III.
Stages in Rostows retail
development model

JFMM
15,2

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

224

In the recent years, there has been discussion and research done on Collaborative
Entrepreneurship. Ribeiro-Soriano and Urbano (2008) say that collaboration enables
a firm to be entrepreneurial and continuously innovative by exploring new markets.
They affirm that continuous innovation and market exploration are the building blocks
of collaboration. Miles et al. (2005) in their book Collaborative Entrepreneurship have
explored this idea and say that the collaborative entrepreneurship model, which requires
appropriate investments to be made in collaborative capability at several levels, will
create wealth and drive continuous innovation. Further, they show how rural and small
business having tangible assets knowledge, relationships, reputation and people may
through collaboration convert these assets into tangible capital.
Most issues in Table IV would reduce greatly if individual stakeholders collaborated
with others in the reverse logistics chain. Further, collaborations would highlight
synergies and encourage innovation in the system. As Miles and Snow have said in their
book, Collaborative Entrepreneurship is:
.
an entrepreneurial strategy that creates economic value through continuous
innovation;
.
pursued by a network of self managing and affiliate firms; and
.
operated by the essential capability of inter and intra firm collaboration.
The study found that a few entrepreneurial stakeholders have started developing
relationships along the reverse logistics chain. The benefits accrued by them were
market knowledge, more predictable business, and better margins. Large portions of
semi urban and rural India may serve as consistent, more profitable markets for a more
organized and consistent merchandise mix.
Summary and conclusions
This paper has given an account of reverse logistics in the apparel aftermarket in India.
The study set out to map the existing reverse logistics processes in the Indian apparel
aftermarket. It studied product acquisition via two channels the barthanwali and the
used clothes importer. It found that both these channels converge when traders inspect
and sort the used clothing according to their value potential and required level of
reconditioning. The study further examined reconditioning, reconstruction and product
development processes in the reverse logistics chain. Next it looked at re-distribution

Table IV.
Issues faced by
stakeholders through the
reverse logistics supply
chain

Supplier issues with their buyers

Buyer issues with their suppliers

Number of market information

Fluctuating and low prices
Number of fixed buyers
Uncertain demand

Number of customer service

Increasing costs
Varying supplier base
Variable product mix
Inconsistent quality
Low product differentiation
Fragmented warehousing
Increasing transportation costs
Dependency on cash flow
Irregular supply

Warehousing costs
Increasing transportation costs
Cash flow
Undeveloped marketplaces

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

and sales in the aftermarket. Throughout it looked at the issues faced and the efforts being
made by individual entrepreneurs as buyers and suppliers in the reverse logistics chain.
It is observed that the aftermarket is highly fragmented, has inconsistent logistics and
long and unpredictable supply chains. There is a need for collaborative initiatives in the
supply chain and amongst retailers in order that market development, business growth
and diversification may happen in the existing aftermarket. There is a need for
entrepreneurs to make geographic strategies and reduce the multiplicity of activity
existent today. With collaborations, the supply chain may become more predictable and
the market product match can be optimized. This would lead in time to more permanent
business linkages and improve throughput to retail. Aftermarket retailers in turn would be
able to plan more efficiently and may develop their enterprise and market themselves
effectively. The evidence from this study suggests that there is also an opportunity for new
retail entrepreneurs to enter this business. Better logistics and regular purchase will
develop a supply chain within the aftermarket which will ensure regular product to store
allowing for merchandise planning and relative consistency. In most locations product
specialization is not yet desirable but in some cases specialization may improve
positioning and customer loyalty.
As mapping and understanding of the aftermarket was the primary aim, the current
study did not assess the costing at each stage. A study could be carried out based on this
mapping at each stage taking into account labour and material costs input and exchange
values. This could help develop business models in the aftermarket.
References
Batra, M. and Niehm, L. (2009), An opportunity analysis framework for apparel retailing in
India: economic, social, and cultural considerations for international retail firms, Clothing
and Textile Research Journal, Vol. 27 No. 4, p. 287.
Cairncross, F. (1992), Costing the Earth: The Challenge for Governments, the Opportunities for
Business, Harvard Business School Press, Boston, MA.
Carter, C.R. and Ellram, L.M. (1998), Reverse logistics: a review of the literature and framework
for future investigation, Journal of Business Logistics, Vol. 19 No. 1, pp. 85-102.
Christopher, M. (1999), Logistics and Supply Chain Management: Strategies for Reducing Cost
and Improving Service, Financial Times/Prentice-Hall, Upper Saddle River, NJ.
Dekker, R. (2006), Focus on Recovery of Value, Rotterdam School of Economics,
Erasmus University, Rotterdam.
Fargher, H.E. and Smith, R.A. (1996), Method and system for production planning, US Patent
Document, US005586021A [11] Patent Number: [45] Date of Patent; December 17.
Flapper, S.D.P. (1996), Logistic aspects of reuse: an overview, Proceedings of the First
International Working Seminar on Reuse, Eindhoven, The Netherlands, pp. 109-18.
Fleischmann, M. and Kuik, R. (2003), Production, manufacturing and logistics: on optimal inventory
control with independent stochastic item returns, European Journal of Operational Research,
Vol. 151 No. 1, pp. 25-37.
Fleischmann, M., Van Nunun, J.A.E.E., Grave, B. and Gapp, R. (2004), Reverse logistics
capturing value in the extended supply chain, ERIM Report Series Reference No.
ERS-2004-091-LIS, November 17, SSRN, available at: http://ssrn.com/636805
Fleischmann, M., Dekker, R., van der Laan, E., van Numen, J. and van Wassenhove, L. (1997),
Quantitative models for reverse logistics: a review, European Journal of Operational
Research, Vol. 103 No. 1, pp. 1-17.

The apparel
aftermarket

225

JFMM
15,2

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

226

Graham, G. and Hardaker, G. (2000), Supply-chain management across the internet, International
Journal of Physical Distribution & Logistics Management, Vol. 30 Nos 3/4, pp. 286-95.
Hansen, K.T. (1994), Dealing with Used Clothing: Salaula and the Construction of Identity in
Zambias Third Republic, Duke University Press, Durham, NC.
Hansen, K.T. (2000), Salaula: The World of Secondhand Clothing and Zambia, University of
Chicago Press, Chicago, IL.
Hashimoto, S. and Moriguchi, Y. (2003), Proposal of six indicators of material cycles for
describing societys metabolism: from the viewpoint of material flow analysis, Resources,
Conservation and Recycling, Vol. 40 No. 3, pp. 185-200.
Hawley, J.M. (2006), Digging for diamonds: a conceptual framework for understanding
reclaimed textile products, Clothing and Textiles Research Journal, Vol. 24, pp. 262-75.
Huang, Y. and Sternquist, B. (2007), Retailers foreign market entry decisions: an institutional
perspective, International Business Review, Vol. 16 No. 5, pp. 613-29.
Koch, K. and Domina, T. (1999), Consumer textile recycling as a means of solid waste
reduction, Family Consumer Sciences, Research Journal, Vol. 28 No. 1, pp. 3-17.
Kopicki, R.J., Berg, M.J., Legg, L., Dasappa, V. and Maggioni, C. (1993), Reuse and Recycling:
Reverse Logistics Opportunities, Council of Logistics Management, Oak Brook, IL.
Krikke, H. (1998), Recovery strategies and reverse logistic network design, Thesis, University
of Twente, Enschede.
Kuchler, S. and Miller, D. (2005), Clothing as Material Culture, Berg Publishers, Oxford.
Kumar, S. and Putnam, V. (2008), Cradle to cradle: reverse logistics strategies and opportunities across
three industry sectors, International Journal of Production Economics, Vol. 115 No. 2, pp. 305-15.
Mhango, M.W. and Niehm, L.S. (2005), The second-hand clothing distribution channel:
opportunities for retail entrepreneurs in Malawi, Journal of Fashion Marketing &
Management, Vol. 9 No. 3, pp. 342-56.
Miles, R., Miles, G. and Snow, C. (2005), Collaborative Entrepreneurship: A Business Model for
Continuous Innovation, Stanford University Press, Stanford, CA.
Mondal, S. and Mukherjee, K. (2006), An empirical investigation on the feasibility of
remanufacturing activities in the Indian economy, International Journal of Business
Environment, Vol. 1 No. 1, pp. 70-88.
Neumayer, E. (2003), Weak versus Strong Sustainability: Exploring the Limits of Two Opposing
Paradigms, 2nd rev. ed., Edward Elgar, Cheltenham.
Norris, L. (2005), Creative entrepreneurs: the recycling of second hand Indian clothing,
in Palmer, A. and Clark, H. (Eds), Old Clothes, New Looks: Second Hand Fashion,
Berg Publishing, New York, NY.
Pilar, L.G.T., Daz, B.A. and Artiba, H. (2004), Environmental and reverse logistics policies in
European bottling and packaging firms, International Journal of Production Economics,
Vol. 88 No. 1, pp. 95-104.
Ravi, V., Shankar, R. and Tiwari, M.K. (2004), Analyzing alternatives in reverse logistics for
end-of-life computers: ANP and balanced scorecard approach, Computers & Industrial
Engineering, Vol. 48 No. 2, pp. 327-58.
Ribeiro-Soriano, S. and Urbano, D. (2008), Overview of Collaborative Entrepreneurship:
An Integrated Approach Between Business Decisions and Negotiations, Springer
ScienceBusiness Media B.V, Dordrecht.
Rivoli, P. (2005), The Travels of a T-Shirt in the Global Economy: An Economist Examines the
Markets, Power, and Politics of World Trade, 1st ed., Wiley, Hoboken, NY.

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

Rostow, E.V. (1960), The enforcement of morals, The Cambridge Law Journal, Vol. 18, pp. 174-98.
Srivastava, S.K. and Srivastava, R.K. (2006), Managing product returns for reverse logistics,
International Journal of Physical Distribution & Logistics Management, Vol. 36 No. 7, pp. 524-46.
Sternquist, B. (1997), International expansion of US retailers, International Journal of Retail
& Distribution Management, Vol. 25 No. 8, pp. 262-8.
Stock, J.R. (1992), Reverse Logistics, Council of Logistics Management, Oak Brook, IL.
Svensson, G. (2007), Aspects of sustainable supply chain management (SSCM): conceptual
framework and empirical example, Supply Chain Management: An International Journal,
Vol. 12 No. 4, pp. 262-6.
Thierry, M., Salomon, M., vans Nunen, J. and van Wassenhov, L. (1995), Strategic issues in
product recovery management, California Management Review, Vol. 37 No. 2, pp. 114-35.
Tibben-Lembke, R.S. and Rogers, D.S. (2002), Differences between forward and reverse logistics in a
retail environment, Supply Chain Management: An International Journal, Vol. 7 No. 5,
pp. 271-82.
Vandermerwe, S. and Oliff, M.D. (1990), Customers drive corporations green, Long Range
Planning, Vol. 23 No. 6, pp. 10-16.
von Bertalanffy, L. (1950), An outline of general system theory, British Journal for the
Philosophy of Science, Vol. 1, pp. 134-65.
Further reading
Dekker, R. and Fleischmann, M. (2004), Reverse logistics: Quantitative Models for Closed-loop
Supply Chains, Springer, Berlin.
Hansen, K.T. (1995), Transnational biographies and local meanings: used clothing practices in
Lusaka, Journal of Southern African Studies, Vol. 21 No. 1, available at: www.jstor.org
Hansen, K.T. (1999), Second-hand clothing encounters in Zambia: global discourses, western
commodities, and local histories, p. 3, available at: www.jstor.org
Horn, S. and Broadbridge, A. (1995), Charity shops a classification by merchandise mix,
International Journal of Retail & Distribution Management, Vol. 23 No. 7, pp. 17-23.
Jeffrey, P.G. (2000), Logistics: vital to every business, Gateway Newsletter, Vol. 21 No. 1, pp. 75-93.
Ketchen, D.J., Ireland, R.D. and Snow, C.C. (2008), Strategic entrepreneurship, collaborative
innovation, and wealth creation, Strategic Entrepreneurship Journal, Vol. 1 Nos 3/4.
Olsen, J.E. and Haslett, T. (2002), Strategic management in action, Systemic Practice and Action
Research, Vol. 15 No. 6, pp. 449-64.
RLEC Projects (1999), Apparel Manufacturers Survey, RLEC Projects, Chicago, IL, available at:
www.rlec.org
Srivastava, S.K. (2008), Network design for reverse logistics, Omega, Vol. 36 No. 4, pp. 535-48
(Special Issue on Logistics: New Perspectives and Challenges).
Corresponding author
Nandita Abraham can be contacted at: nandita@pearlacademy.com

To purchase reprints of this article please e-mail: reprints@emeraldinsight.com

Or visit our web site for further details: www.emeraldinsight.com/reprints

The apparel
aftermarket

227

Downloaded by CARDIFF METROPOLITAN UNIVERSITY At 11:29 06 August 2015 (PT)

This article has been cited by:

1. Kannan Govindan, Hamed Soleimani, Devika Kannan. 2015. Reverse logistics and closed-loop supply
chain: A comprehensive review to explore the future. European Journal of Operational Research 240,
603-626. [CrossRef]
2. Kerli Kant Hvass. 2014. Post-retail responsibility of garments a fashion industry perspective. Journal
of Fashion Marketing and Management: An International Journal 18:4, 413-430. [Abstract] [Full Text]
[PDF]
3. Muthusamy Aravendan, Ramasamy Panneerselvam. 2014. An Integrated Multi-Echelon Model for a
Sustainable Closed Loop Supply Chain Network Design. Intelligent Information Management 06, 257-279.
[CrossRef]
4. Bin Shen, Yulan Wang, Chris K.Y. Lo, Momoko Shum. 2012. The impact of ethical fashion on consumer
purchase behavior. Journal of Fashion Marketing and Management: An International Journal 16:2, 234-245.
[Abstract] [Full Text] [PDF]
5. Holly PuiYan Ho, TsanMing Choi. 2012. A FiveR analysis for sustainable fashion supply chain
management in Hong Kong: a case analysis. Journal of Fashion Marketing and Management: An
International Journal 16:2, 161-175. [Abstract] [Full Text] [PDF]