ATTIRE

A New You, Everyday

A New You,
Everyday

OVERVIEW
CURRENT BUSINESS : Indian Apparel Industry.

CURRENT PRODUCT LINE : Youth casuals and Party

wear

CURRENT MARKET SEGMENT : The Youth segment,

with prominent focus on the college goers who form a
major chunk in casual clothing.
CURRENT BUSINESS MODEL : We are a
manufacturing concern which has a sole shop in a
Delhi market but majorly distribute our products in
the existing retail shops and showrooms.

VISION
To attain market leadership in fashion
industry by offering apparels of
unmatched superiority and fostering a
culture of employee empowerment
and customer satisfaction while
following the highest ethical and
professional standards.

MISSION
We help the fashion savvy youth
become trend setters through our
premium collection made exclusively
for the youth.

GOALS
To become market leader in the youth apparel
segment
To create and establish a fashion statement among
the youth with our high quality and unparalleled
offerings
To help the youth set a new trend everyday
To establish long lasting and mutually beneficial
relationship with all our stakeholders- suppliers,
distributers, buyers, government, community and so
forth
To be a socially responsible and highly ethical
corporate

OBJECTIVES

Greater market share

Higher growth rate
Higher earnings
Loyal customers
Affordable price
Highly motivated employees
Higher or better product quality(shall also
be used as product differentiation
strategy in market)

STRATEGIC ANALYSIS
1. INDUSTRY ANALYSIS
Of the total Indian retail market, 8% constitutes the organised retail
segment which is estimated to grow at a rate of almost 30% by 2015.
Clothing & Apparel make up almost a third of the organized
retail segment, followed by Food & Grocery and Consumer
Electronics.
The Indian apparel industry has an overwhelming presence in the
economic life of the country.
It is one of the earliest industries to come into existence in the country.
It provides one of the basic necessities of life
It also plays a pivotal role through its contribution to industrial output,
employment generation, and the export earnings of the country.
Currently, it contributes about 14 percent to industrial production,
4 percent to the GDP, and 17 percent to the countrys export
earnings. It provides direct employment to over 35 million people.

 The Indian apparel industry is estimated to

be worth Rs. 3,270 billion in 2011-12
Expected to grow at a compounded annual
growth rate of 8.7 per cent till 2016.
growth would primarily be driven by
surge in demand for readymade apparels in
semi-urban areas,
rising income levels and youth population
and
increasing preference for branded apparel.

2. MARKET
ANALYSIS
Indian apparel market is segmented in three different ways:
1. Segmentation by user category: The domestic apparel
industry has 3 segments, viz Mens wear, Womens wear and
Kids wear. Menswear accounts for 40% of the total market .
a.) Mens wear: Mens wear market in India is the fastest
growing apparel segment. The entire apparel industry
(2011-12 estimates), including domestic and exports, is
pegged at Rs 3,270 billion and is expected to grow by 11% to
Rs 10,320 billion by 2020. Currently menswear is the major
segment of the market (Rs 720 billion) and is growing at a
compounded annual growth rate (CAGR) of 9%. Gucci, Hugo
Boss, Salvatore Ferragamo, Armani, Versace, Brioni,
Ermenegildo Zegna, Canali, Corneliani, Alfred Dunhill, Cadini,
are all present in India mens wear market.

b.)Womens wear: Womens formal wear and ethnic wear markets

are still ruled by unorganized players. With more women
expected to enter corporate world, both these segments are good
opportunities because of the market size. Historically, the mens
apparel market in India has been significantly larger than the
womens apparel market. With only 20 percent of Indias urban
women in the workforce, womens wardrobes have traditionally
been limited to home wear and items for special occasions.
Now, women are more willing to dress differently when they venture
beyond the hometo shop, for example, or visit a school or office.
The trend of women opting for readymade versions of ethnic
dresses is also catching up (think of Meena Bazaar, Suruchis, etc.)
c.) Kids wear: Kids wear is a major category with few established
players viz., Lilliput, Gini and Jony, Catmoss, Benetton, Disney,
Barbie etc. It still holds a large opportunity which is clearly
untapped. The Indian kids wear retail market is expected to touch
Rs 580 billion by 2014. At present, the size of kids wear market in
India is estimated at about Rs 380 billion.

2. Segmentation by Use: A rough estimate of the

segmentation by use shows thatCasual apparel dominates and accounts for more than 50% by value.
27% sports,
15% formals and
5% ethnic wear.

3. Segmentation by Price:
a. Low-end market: volume driven, products are mostly
unbranded and dominated by large number of manufacturers,
mostly regional or even local players.
b. Mid-range market: quality products. Manufacturers large
and medium.
c. High-end market: premium and super premium product
categories. Dominated by MNC and major Indian
manufacturers.

3. ANALYSIS OF THE INTERNAL

ENVIRONMENT
Analysing the internal environment essentially
consists carrying out a SWOT analysis, i.e. an
analysis of the strengths, weaknesses,
opportunities and threats to the company. The
strengths and weaknesses, which are internal to
an organization, should be analysed and used to
tap the opportunities and minimise threats
present in the firms external environment.
The following slides present the SWOT of the
readymade garments industry as well as of Attire.

A. SWOT ANALYSIS OF READYMADE

GARMENTS INDUSTRY
STRENGTHS:

OPPORTUNITIES:

WEAKNESSES:

Increasing demand for luxury brands

from the middle class
Large potential in international
market
Product development and
diversification to cater to global
needs
Research and new product
development can help the
companies to move across the value
chain
Increased use of CAD for designing
capabilities
THREATS:

Increasing disposable incomes of

the people
Brand conscious customers
Availability of cheap finance and of
low cost and skilled manpower
Growing domestic market ,
increase in number of malls
Independent and self-reliant
industry

Predominance of unorganized
sector
Technological obsolescence in
the supply chain
Infrastructural bottlenecks and
efficiency such as transaction
time at ports and transportation
time
Unfavorable labor laws

Increased competition in the

domestic markets
Rising prices of inputs-raw material
Cheaper imports
Changing governments policy on
FDI
Competition from developing
countries especially China

B. SWOT ANALYSIS OF
ATTIRE
STRENGTHS:
Financially sound
Located in the heart of the city
Low prices of the merchandize
attract customers
Deals in all types of apparels of
youth
Helps youth keep up with the
fashion trends
Owns private label brands

OPPORTUNITIES:
Located at a prime location
where economies of
concentration , information etc
exist
Delhi has one of the highest per
capita income, thus the spending
power of people is high
Youth needs more variety in
apparels
Large potential to reduce
operation cost in cities using

WEAKNESSES:
Acute lack of awareness about
the store
Most customers visit the existing
stores only while passing by
Low percentage of national
brands in the store-a major
constraint
Product variety is available but
more SKUs are not present due to
inefficient back end infrastructure
Poor inventory control at certain
locations is a concern
THREATS:
New brand name in the market-no
backing by an established brand
unlike competitors
Following stores are in close
proximity to the store Westside(1.5
km),Pantaloons(500 m),Reliance
Trends(500m)
Operating costs are too high
Walmart serves as the biggest
threatwhen it comes to backward

The IFE Matrix : Internal Factor

Evaluation
KEY INTERNAL FACTORS

WEIG
HT

RA
TE

WEIGHTED
SCORE

STRENGTHS:
i.

Financially sound

0.11

0.44

ii.

Located in the heart of the city

0.12

0.48

iii.

Low prices of the merchandize

attracts customers

0.10

0.40

iv.

Deals in all types of apparels of

youth

0.08

0.32

Helps youth keep up with the

fashion trends

0.06

0.18

0.06

0.18

vi. Owns private label brands

KEY INTERNAL FACTORS

WEIGHT

RATE

WEIGHTED
SCORE

WEAKNESSES:
i.

Acute lack of awareness

about the store

0.12

0.24

ii.

Most customers visit the

existing stores only while
passing by

0.10

0.20

iii.

Low percentage of national

brands in the store

0.08

0.08

iv.

Product variety is available

but more SKUs are not
present due to inefficient
back end infrastructure

0.09

0.18

v.

Poor inventory control at

certain locations is a concern

0.08

0.08

Total

2.78

CONCLUSION FROM IFE

Since the weighted score > 2.5, it is
considered that the organization is
internally strong to withhold or counter
competition.

The EFE Matrix : External Factor

Evaluation
KEY EXTERNAL FACTORS

WEIGHT

RAT
E

WEIGHTED
SCORE

OPPORTUNITIES:
i.

Increasing population of the youth

0.13

0.52

ii.

Westernisation and globalisation in

India, due t which fashion industry in
India is gaining momentum

0.12

0.48

iii.

Increasing per capita income

0.08

0.24

iv.

More no. of people joining the workforce

0.09

0.27

Ability to grow rapidly because of

sharply rising demand in one or more
market segments

0.10

0.30

vi.

Emerging new technologies like internet

and e-commerce helping in lower costs
and new sales/growth opportunities

0.12

0.48

vii
.

Immense popularity of Bollywood

among youngsters who emulate the
stars to upkeep with latest trends

0.04

0.12

KEY EXTERNAL
FACTORS

WEIGH
T

RATE

WEIGHTED
SCORE

THREATS:
i.

Potential competition
from online avenues like
Myntra, Jabong, etc.

0.10

0.20

ii.

Competition from existing 0.11

and established players

0.22

iii.

High economies of scale

required to produce
goods that could be
considered substitute in
cheap fashion industry

0.05

0.05

iv.

Increasing bargaining
power of suppliers due to
inflation thereby
increasing costs

0.06

0.06

TOTAL

1.00

2.94

CONCLUSION FROM EFE

Since the weighted score > 2.5, it is
considered that the organization has
enough opportunities in the external
environment and is in a favourable
position to withhold or counter
competition.

4. ANALYSIS OF THE EXTERNAL

ENVIRONMENT
The external environment of an organization is
majorly composed of the politico-legal
environment, the economic environment, the
socio-cultural environment and the technological
environment. Therefore, what follows is a PEST
analysis of Attire.

I. POLITICAL FACTORS
There has been implementation of several programs by the
Government of India (termed as GOI from now onwards in the
report) to help the textile and apparel industry adjust to the new trade
environment.
IMPORT-EXPORT POLICY
At present, the import duty on synthetic fabrics is about 21 per cent.
In the wake of sluggish demand from traditional markets, the apparel sector
has been pressing for import of synthetic fabrics at a lower duty of 5 per
cent in the entire 12th Five-Year Plan
During 2012-13, India's apparel exports declined by about 6 per cent yearon-year to $12.9 billion on account of weak demand from the western
markets. The US and EU together account for 60 per cent of India's total
garment exports
According to ApparelExport Promotion Council (AEPC) the cost of credit is
too high for the industry. At present, the exporters get credit at 12.5 per cent
so there is a need to provide export credit at fixed 7.5 per cent to the sector

 TARIFF BARRIERS
Under the United States-IndiaTextile Agreement of January 1, 1995,
India agreed to reduce tariffs on textiles and apparel and remove all
import restrictions on these products
India agreed to bind tariffs at 20 percent ad valorem for yarns, fibers,
Industrial fabrics, and home furnishings, 35 percent for most apparel
fabrics, and 40 percent for apparel goods
Although India has significantly reduced its textile and apparel tariffs,
these tariffs still rank among the highest in the world, especially on
products that can be domestically substituted. Additionally, domestic
taxes and levies, which are applied to both imported and domestic
goods, make the effective tariff rates much higher
Apparel products are not subject to excise duties and most other
miscellaneous taxes, but are categorized as restricted imports.
Several types of Indian tariffs and other taxes are shown on the
following page:

Type of tariff and tax Applied on:

Basic customs duty - Levied on assessed c.i.f. value of imports plus
landing charges; generally does not exceed 1 percent of the c.i.f.
value.
Surcharge on customs duty - Selected textile imports.
Discontinued as of April 1, 1999. Calculated on the assessed value
plus the basic customs duty.
Basic excise duty - Countervailing duty on imports to offset levies
on domestically produced like products. Varies by product, ranging
from zero on natural fibers to 32 percent on polyester filament yarn.
Grey fabrics and certain cotton yarns are exempt from excise duty.
Levied on the sum of assessed value, basic customs duty, and
surcharge.
Surcharge on excise duty - Selected textile items (manmade fibers
and yarns). Most fabrics are exempted. Surcharge is 15 percent on
excise duty. For example, on an 8 percent basic excise duty, the
surcharge would be 1.2 percent.
Cess tax - All textile items. This tax is 0.05 percent of the assessed
import value plus custom duties including surcharge.
Special additional duty - Counterbalance to sales tax and other
local taxes on like products. Assessed at 4 percent of the sum of
assessed value, basic customs duty, surcharge, excise duty (including
surcharge), and cess


NON-TARIFF BARRIERS
1.
IMPORT LICENSING
India has liberalized its import licensing regime for textiles and apparel, but still limits
market access for imported apparel. Currently, unrestricted importation applies to
items such as yarns and fabrics intended for further processing. Apparel and made-up
textile goods generally require a special import license (SIL) or are subject to import
restrictions that apply to consumer goods
2.
CUSTOMS
The country has cumbersome customs procedures that are regarded as highly
bureaucratic and time-consuming.
Documentation requirements are extensive and delays frequent.
imports are often misclassified and improperly valued for assessment of duties
and procedures are not consistent among different ports of entry

imports of missing components of kits are often assessed duties twice, once when
the kit is originally imported and again, when the missing component is separately
imported (despite a no charge notation on the invoice).
Similar difficulties and bureaucratic delays with the export and reimport of capital
goods for repairs are also cited.
3.
MARKING, LABELING, AND PACKAGING REQUIREMENTS
Marking, labeling, and packaging requirements applicable to textile and apparel
products are technically complex and difficult to fulfill.

Textiles Regulation 1988, which is designed to protect consumers, imposes strict

safety and marking guidelines on fabrics and other textile products that are sold
in the home market.

The regulation requires all tops, yarns, and fabrics to have the statutory markings
prescribed in the government notification and states that such markings should in
no way mislead consumers

Cloth, for example, must be marked with the name and address of the
manufacturer, a description of the cloth, sort number, length in meters and width

 EXPORT-IMPORT POLICY
The GOIs EXIM policy provides for a variety of largely export-related assistance to
firms engaged in the manufacture and trade of textile products. This policy
includes fiscal and other trade and investment incentives contained in various
programs, as discussed below.
Duty Entitlement Passbook Scheme (DEPS) is available to Indian export
companies and traders on a pre- and post-export basis
The Export Promotion Capital Goods (EPCG) scheme is available to export
companies and traders who provide the GOI with information on the type and
value of capital goods they are importing and the exports they expect to produce
using those imports. Depending upon the level of the export commitment at the
time of import goods, the GOI provides exporters with a license allowing them to
import capital goods duty-free or at preferential rates of duty.
Pre- and Post-Shipment Financing provided by RBI through commercial
banks on presentation of required documents
Export Processing and Special Economic Zones - Units in the EPZs that
export all of their output can import industrial inputs free of customs duty. A 5year tax holiday is allowed to any industrial unit in a EPZ and all profits of 100percent EOUs are exempted from income tax. To attract investment, the GOI
allows 100-percent foreign ownership of units in the EPZs as well as the SEZs.
The SEZs were created recently, with the conversion of four EPZs into SEZs. The
GOI treats SEZs as foreign territory for trade and tariff purposes. Units in SEZs
may engage in manufacturing, trading, and services; are exempt from routine
examination of exports by customs; and can sell in the domestic market on
payment of duty as applicable to imported goods

 NON TRADE POLICIES

Technology Upgradation Fund - The GOI has set up a Technology
Upgradation Fund (TUF) to alleviate the problem of high capital costs in India
and to encourage modernization of the textile and apparel industry.
Cotton Technology Mission - The GOI has set up a Cotton Technology Mission
to increase research on improving productivity and quality of Indian cotton and
bringing about improvements in the marketing infrastructure and the raw
cotton processing sector.
Quota Entitlement Policy - Textile and apparel trade was for many years
largely governed by the terms of the 1974 Multifiber Arrangement (MFA) and
predecessor arrangements. On January 1, 1995, the Agreement on Textiles and
Clothing (ATC) entered into force as part of the WTO agreements and replaced
the MFA. Under the MFA, the United States, the European Union (EU), Canada,
and Norway negotiated bilateral agreements with India and other textile and
apparel exporting countries that established quantitative limits or quotas on
their exports of certain textile and apparel articles. The ATC provides for the
elimination of the quotas and complete integration of textiles and apparel
into the WTO regime
INVESTMENT POLICIES AND FOREIGN DIRECT INVESTMENT
As a part of its economic reforms, the GOI has liberalized its investment policies
for the textile industry. The RBI now grants automatic approval within a period
of 2 weeks to all proposals involving foreign equity up to 51 percent in the
manufacture of textile products
FDI in Indias textiles industry has been low largely because the GOI first
allowed FDI rather late in the mid-1990s, when most funds were being invested

 NATIONAL TEXTILE POLICY 2000

The NTP 2000 aims to improve the competitiveness
of the Indian textile industry in order to attain $50
billion per year in textile and apparel exports by
2010.86 The NTP 2000 opens the countrys apparel
sector to large firms and allows up to 100 percent
FDI in the sector without any export obligation
According to the GOI, the deregulation will help the
apparel sector develop state-of-the-art apparel
manufacturing facilities and reach economies of
scale to withstand competition from low-cost
countries and increase apparel exports to $25
billion by 2010
The NTP 2000 liberalizes government controls and
regulations so that different sectors within the
textile and apparel industry can function in a more
competitive environment

 Effect of VAT and Service Tax Changes

For the past two years, Indias apparel industry is going through
a period of turbulence, unexpected changes and challenges. In
2011, the industry struggled due to the unexpected fluctuation
on fiber prices, and especially the price of cotton.
The introduction of 10% excise duty on branded apparel in the
Union Budget for 2011-12 added to the problems faced by
apparel manufacturers and retailers.
The Union Budget for 2012-13 provided minor relief in terms of
excise duty, but service tax rate was increased from 10.3% to
12.36%.
At the same time, many of the state governments implemented
VAT on apparel.
The weak economic outlook, reduced consumer spending, and
rising costs, coupled with the newly introduced excise duty on
branded apparel, increase in service tax, and implementation of
VAT remained the moot points of the industry for the year 2012.

OTHER FACTORS
Absence of strong political eadership
Confrontational politics

II. Economic
Factors

The Indian economy has continuously recorded high growth rates and has
become an attractive destination for investments. India is the second most
preferred destination for foreign investors, according to the report 'Doing
Business in India' by Ernst & Young
The resilience that Indian economy has shown in last 5 years by being far
less impacted by the global financial meltdown indicates the structural
strengths of the growth model.
The current scenario of Indian economy has been characterised by
optimistic growth and strong macro-economic fundamentals, particularly
with tangible progress towards fiscal consolidation and a strong balance of
payments position
Indian GDP has grown at an average growth rate of ~7% in the last decade
to reach at US$ 1.8 trillion in 2012-13 making it worlds 10th largest
economy. It is expected to grow despite having tough situation in the
global markets. GDP per capita has also increased multifold during the
same time period.
Foreign Direct Investment has also played a key role in putting India on fast
growth track. It has been on a constant rise since 2002-03 and has
registered a strong CAGR of 16% in the last decade to reach at more than
US$ 22 bn. in 2012-13 from US$ 5 bn. in 2002-03. Peak investment of US$
38 bn. was achieved during 2008-09 & 2009-10 but due to global
meltdown & Eurozone crisis, decline in the investment is experienced in
last few years

 EFFECT OF TAXES

EFFECT OF EXCISE DUTY

introduction of 10% excise duty on branded apparel in 2011-12 with an

abatement rate of 55%
In 2012-13, abatement rate increased to 70%, but the excise duty increased from
10% to 12%. As a consequence, the effective excise duty decreased from 4.5%
to 3.6%, a reduction of 90 basis points

VAT: A Contentious Issue

For a manufacturer and retailer, value-added tax, or VAT, is applicable to the

value addition part of the product.
However, from the consumers perspective, the tax is an additional burden, as
she/he has to pay a higher amount for the same apparel.
Apparel retailers are forced to think about the impact of any kind of purchase
price increase on consumer spending and often need to shrink their own
profit margin so that the effect of price rise will not get transferred to
the end consumer.
VAT being a concern of state governments rather than the Union government,
there are differences in the tax rates imposed.
Governments in Delhi, Uttar Pradesh, Punjab, and Rajasthan charge a VAT of 5%
on apparel while most other states charge 4%.
On textile items, some states are charging VAT, while some other states were
forced to rollback VAT after an initial announcement.
Nonetheless, the imposition of VAT has added to the complexities of the
countrys textile and apparel value chain that extends across more than
one state, and has negatively affected both consumers and
manufacturers of readymade apparel.

 SERVICE TAX
In fiscal 2012-13, the service tax was increased by 2% and additional service
categories, which were previously exempted from tax, were included in the list
As a result, retailers and manufacturers witnessed an increase in their costs, as
they had to pay an additional tax for each service they had used, e.g. rent,
electricity, etc.
Most of the retailers had to compromise on their profit margin so as to protect
the customer from the heat of the tax

OVERALL IMPACT OF TAXES

Due to the combined effect of taxes, the average sales price of apparel products
increased by 5-6%.
The prices of branded apparel had already increased by 10-12% in the previous
year on account of the high raw material price and the introduction of excise
duty.
Most apparel retailers had witnessed a negative growth of 4-5% in their volume
sales for the first half of the fiscal year 2012-13. But they managed to maintain
their revenues due to the increase in average sales price.
The EBITDA margins of some retailers plummeted as transferring all the cost to
consumer was not possible.
Most of the retailers attributed the drop in EBITDA margin to the hike in service
tax and also power cost, which increased by 25-30% per unit.
Additionally, the share price of most retailers dipped in 2011 and 2012 due to
declining volume growth and increasing price.
Policy reforms on FDI in multi-brand retail helped some apparel retailers to
perform better in the share market in the latter part of 2012.

 GST: THE SOLUTION AWAITED

Many apparel retailers are looking forward to
the implementation of the Goods and Services
Tax (GST) which is expected to come into
effect by fiscal 2013-14
GST is expected to not only solve the problem
of service tax, but also reduce the other tax
related complexity in value chain through the
introduction of uniform SGST (State GST).
It might in fact impact the apparel industry in
a positive way as it will reduce tax payments
in services, real estate rents and other
service-related activities.
The benefits will percolate upstream to the
apparel manufacturer as well.

III. TECHNOLOGICAL FACTORS

The average annual investment in machinery per establishment in

Indias apparel sector is only $2,900, compared with Hong Kongs
$2.5 million and Chinas $1 million
The new precutting machines are being installed at an average
annual rate of 2.9 machines per unit in South Korea, compared
with 2.3 machines per unit in China, 2.0 machines per unit in
Thailand, and almost nil in India
The low level of technology has contributed to low productivity
and deprived the sector of benefits of economies of scale
Under Indian labor laws, firms had been discouraged from
installing labor-saving machinery and equipment, thereby leading
to low sector productivity and inferior product quality
A limited fabric base and lack of product specialization are major
weaknesses of the Indian apparel sector. The predominance of
cotton apparel reflects the fact that Indian cotton traditionally has
been much less expensive than synthetics and cotton blends.
Quality problems are another deterrent to expanding export
shares in the global market. The majority of fabrics made in India
are of low quality and limited varieties, which limits the product
range and tends to lower the unit value realized in dollar terms.

5. COMPETITIVE ANALYSIS : MICHAEL

PORTERS 5 FORCES

1)Threat of substitute products- ethnic wear, local shops providing

copied or defective products at a cheaper rate , brands offering
clothings and garments in the price range of Rs. 500-3000.
2)Rivalry among existing players- High competition in the players as
discount offers, sales periods, promotional schemes are similar in all
the competitive brands . and are given out at the same time so that no
brand eats others shares. The only way to have an edge in the market
is through product differentiation. But no one brand enjoys a significant
market share.
3)Barriers to entry- government regulations to enter the industry are
not very strict and difficult to handle. No special patents and
intellectual rights needed to enter and existing players cant restrict the
entry of a new player in any significant way. There is no legal cost
involved to exit the industry and only high levels of unused inventory
can be the major cost that the player needs to bear.
4)Bargaining power of suppliers- Majority of the suppliers dont
exercise siginificant bargaining power as suppliers are present in plenty
of numbers providing similar quality of cloth at similar rates and
manufacturers have the plenty of option of switching suppliers.
5)Bargaining power of customers- Customers have very high

MAJOR COMPETITORS

Pantaloons
Lifestyle
Shoppers Stop
Reliance Trends
Max
Marks and Spencers
Westside

VALUE CHAIN ANALYSIS

A value chain describes the full range of activities that firms and
workers carry out to bring a product from its conception to its end
use and beyond.

Our

Designers, Manufacturers and the Sales Department work together to make

decisions about
product specifications, material sourcing and retail strategy.

SOURCI
NG
DECISIO
NS

GARMENT SPECIFICATION
DESIGNS

PORTFOLIO ANALYSIS

PORTFOLIO ANALYSIS : BCG MATRIX

According to the BCG Matrix, the business or products
are classified as low or high performance
depending upon their market growth rate and
relative market share.
Market Share- It is the percentage of the total market
that is being serviced by a company measured either in
revenue terms or unit volume terms.
Growth Rate- It is used as a measure of a markets
attractiveness.

STAR (High growth, high market share)

Stars are leaders in business.
They require heavy investment to maintain its
large market share.
Attempts should be made to hold the market share
otherwise the star will become a cash cow.
It leads to large amount of cash consumption and
cash generation.
RECOMMENDATIONS
Maintain the market position.
Invest for further growth.

CASH COW (Low growth, high

market share)
They are the foundation of the company and stars of
yesterday.
The generate more cash than required.
They extract the profits by investing as little cash as
possible.
RECOMMENDATIONS
Need to maintain the market share to generate cash flows.
There is not much potential for generating higher profits.

DOGS (Low growth, low market

share)
They do not have much potential to bring in cash.
Here, the business is at a declining stage.
RECOMMENDATION
There isnt any growth opportunities.
The only solution is divesture strategy.
The cash flows are negative.

QUESTION MARK(High growth, low

market share)
Most businesses start of as question marks.
They will absorb great amounts of cash if the market share
is low.
? Have the potential to become star and eventually cash
cow but can also become a dog.
Investments should be high for question marks.
RECOMMENDATIONS
The market strategy is to get markets to adopt these
products.
The company needs to increase its market share quickly
and the best way is to invest heavily in them.

ATTIRES POSITION IN BCG MATRIX

Since Attire is a new readymade garments company, it finds
itself in a market with high growth rate and has a low
market share. Thus it is a question mark where the
products offered for the youth are yet to be discovered and
accepted by them.
The returns are thus lower due to the low market share but
with extensive marketing of its product, the demand for the
products will increase.
The company has to invest heavily in them to gain market
share and there are a lot of unrealized opportunities as well.

GEs SPOTLIGHT GRID

INDUSTRY
ATTRACTIVEN
ESS

Retail sector
growth- 2530%
Market size40 -50
crores
Intensity of
competitionhigh
Seasonalityhigh
Regulationless
Capital
requirement
s Retailing-

Market share-0.0013%
Technological know-how- required
in designing , capital investment,
machine operations etc
Product quality-superior
Prices- highly competitive
Service network- 2 stores in Delhi
initially

10.0
HIGH
6.7
MEDIU
M
3.3
LOW
1.0

COMPETIT
IVE
POSITION

STRONG 6.7 AVERAG 3.

E
3

WEAK

1.0

ATTIRE AFTER AN YEAR OF

COMMENCEMENT

EVALUATION STRATEGIES
1. Direct Feedback:

Observing in the showroom about customer

reaction to our product(s) on a busy Sunday
evening. This is done by getting feedback forms
filled by customers while billing takes place and/or
hiring interns (preferably college students) who
act as mystery shoppers and then give feedback.
We also obtain feedback from salesmen and
retailers as they are the ones who are in direct
touch with customers.

2. Supply chain analysis:

Raw material
supplier

Manufactur
er
Distributo
rs
Custom
ers

This addresses

the following questions:

Is your supply chain well organized?- Yes. (Raw
Material Supplier-Manufacturer-DistributorsCustomers)
Is it functioning properly? Yes. (We are clear as to
which raw material is to be procured from which
supplier, the agreements entered into with them,
the margins offered to both suppliers and
distributors, inventory levels maintained at every
level, and inventory replenishment level, if the
feedback is being passed on to the previous level
and being taken care of or not, etc.)
Do we need to add more or reduce some elements? Add more (Seeing the response from the customers
and the increase in demand for our products, we
believe that we need to add more raw material
suppliers and also distribution channels in the form
of, say, shopping malls, discount stores and exports
later on.)
Do you need to supply more quantity through
distributors rather than your exclusive shops? - Yes.

3. Clearance rate in fresh periodClearance rate basically implies how much of the product
was sold during the fresh and discount period.
During the fresh period, approximately 70% of the goods
were sold out of the total manufactured goods of 1 lakh.
However during the discount period, only 5% of the products
were being sold.

4. Leftover Rate.Leftover rate helps to find out the number of products

which are unsold even after the discount and fresh sale.
.Even after providing discount, the number of units which
remained unsold accounted to approximately 25,000. The
total number of products manufactured were about 1 lakh.

5. Payment Cycle

Payment cycle helps to find out the cash flow of the

business and whether the products are being sold easily or
not.
The total number of products sold accounted to about
75000 of the total products manufactured.
Even the distributers made the payments on time and thus
the cash flows were stable for the company.

ANALYSIS OF RATIOS
RATIO

QTR 1

QTR 2

QTR 3

QTR 4

1. Current
Ratio

0.5

0.9

1.5

2. Quick
ratio

0.1

0.3

0.7

1.2

3. Debtors
Turnover

10

4. Profit
margin %

10

20

23

39

5. Sales
Revenue
growth rate

0.01%

2%

6%

10%

6. Return on
assets

0%

2%

2%

3%

7. Return
on capital
employed

0%

1%

1%

1%

8. Debt
equity ratio

9.
Enterprise
Value

1,000,000

1,000,000

1,000,000

10,000,000

An analysis of key financial ratios over four quarters in the first

year of establishment of our business clearly reflects that the
business is growing very quickly. The profit margins have
increased substantially and so have sales growth, return on
assets, return on capital employed, etc.

EXPANSION STRATEGIES

GEOGRAPHICAL EXPANSION:
This approach involves expanding our business from its original
location to one or more additional geographic sites, and is particularly
well suited for us as our products may be appealing to consumers in
other markets and where we can get a wider range of consumer base.
Geographic expansion can help us reduce costs, gain access to new
markets and talent pools, and perhaps, most importantly, provide a
robust pipeline to fuel our companys future growth. We are presently
operating only in Delhi NCR region and we are planning to expand to
nearby regions like Ludhiana, Chandigarh, Punjab, Ahmedabad and
Haryana. We are planning to hire a distributor in all these regions
through which we will circulate our product in the new areas. This wont
increase our efforts considerably as we would need to take care of only
transportation of our goods to our distributors in these areas and the
rest would be handled by them.
DESIGNS:
We had started with 10 designs in our garments range when we had
initially come in the market. But during the past year we realised that
10 designs are not enough to get noticed in the market. So this season,
we are planning to come up with a wider range of designs in all our
categories starting from the plain and simple designs to extravagant
and party wear designs. The new designs will all be different from each
other and would be made keeping in mind the different classes of

 QUANTITY:
When we had ventured into the business, we had started with 4 basic
sizes of the 10 designs we were manufacturing. This way we had
produced around 400 pieces of our product which is acceptable in the
garment industry as a respectable quantity to be produced in a season
but is not significant enough to help a business grew radically. So this
season we plan to introduce more sizes in our range, especially targetting
customers who dont usually get their sizes in other standardised brands
and thus have to often get their clothes stitched. We would come up with
new sizes in our product range, thus increasing our quantity of products
manufactured while providing a new range of choice for a select class of
customers. This will give us an advantage in terms of customers noticing
and preferring our product.

VARIETY:
We had only started with garments for college going kids and young
people. But a business grows significantly, when it can become a one
stop shop for customers. So this year, we are planning to expand into a
variety of related products like accessories, undergarments, scarfs. This
wont entail any major technological or labour advancement in our already
established manufacturing setup and can be produced using the same
mechanism. It will help us venture into new markets and expand our

DISTRIBUTION CHANNEL:
Thefuture growthof our business will depend in part on our ability to
expand our existing relationships with distributors, to identify and develop
additional channels for the distribution and sale of our products and to
manage these relationships. As part of ourgrowth strategy, we may expand
our relationships with distributors and develop relationships with new
distributors. We will also look to identify and developnew relationshipswith
additional parties that could serve as outlets for our products, or that could
provide additional opportunities for our existing sales channels. Apart from
our existing retail and wholesale channels, the new distribution channels
we would expand in are:
Sales reps: Hiring sales repsto widen our reach. By choosing reps who
work independently, we can avoid the costs associated with opening
additional offices in targeted areas.
Internet: E-commerce is the latest fad and on a rise nowadays and we
would become a part of this trend by making our product available online
too.
Road shows: Hiring distributors in new areas entail increase in cost and
efforts. Instead of this, we can adopt road shows as part of our expansion
plan. Every year before a season starts, every zone has an exhibition of

THANK YOU!