Fab India

Topics: Retailing, Organic food, Organic farming Pages: 10 (2042 words) Published: July 21, 2010

Group V: Budhaditya Banerjee Sourabh Dhariwal Tarun Daga Uma Balakrishnan

‡ ‡ ‡ ‡ ‡ ‡ Timeline Fabindia under John Bissell Fabindia under William Bissell Competitor Analysis SWOT Analysis Buying Behaviour and the Way Ahead ± Organic Food ± Apparel ± Home Furnishings & Furniture

‡ Financial Comparisons ‡ Recommendations at a Glance

FabIndia Indian Economy
Post 47- govt supports socialism & nationalism 1957- Govt sets up KVIC

1960- Incorporation in Delhi 1976- First retail store in GK 1977- Contemporarizes design 1981- Introduction of garments

1990- Fiscal deficit reaches 8.5% 1991- Indian economy opens up

1992- Liaison with Habitat ends 1994-Second store opens in Delhi 1999- William Bissell becomes MD 2003-Vision Plan I originates 2004- Goes online 2006- 8% economic growth 2005- Vision Plan II is born 2006- Garments make 70% revenue 2006- Govt allows foreign single brand outlets

‡ Founded by American, John Bissell to:
± Develop market for hand-woven products ± Provide rural employment

‡ Incorporated in 1960 in Delhi to export upholstery fabric ‡ By 1965, revenues of Rs. 2 million due to: ± AS Khera, supplier of hand-woven rugs etc from Panipat ± Habitat, major UK buyer of Fabindia Panipat products

‡ 1974 saw Fabindia s first retail store in Greater Kailash with ad-hoc merchandising ‡ 1977-Featured contemporary design to attract consumers and designers ‡ Garments were introduced in 1980s after John Bissell got khadi shirts made for himself ‡ Habitat was acquired in 1992 and Fabindia could no longer continue selling to it ‡ John Bissell dies in 1998, passing the baton to son William Bissell who becomes MD in 1999

‡ End of license raj, and liberalization gave textiles duty concessions on machine imports ‡ William s vision included expansion, depending less on exports and setting up retail operations ‡ India saw robust economic growth, change in consumer patterns and growth of middle class by 2006 ‡ 2003 saw the birth of Vision Plan I ± Planned to grow to revenues of Rs. 1 b from Rs. 360 m in 4 years ± Achieved it in two years and Vision Plan II came along ± It planned to achieve revenues of Rs. 2 b by March 2009

‡ Organized Retail: Retail Stores (Shopper s Stop, Pantaloons, Globus, etc.) Weaknesses:1. Product diversity lacking 2. Stock as per running trends and serve to fads-inconsistency towards churning out quality offerings in hand crafts 3. Authenticity of handcrafts-No craftsmark present to validate the crafts as against the Fabindia offerings which have the same imprinted on them Strengths:1. Strong Pan-India presence and awareness 2. Man-power expertise 3. Competitive Pricing 4. Robust supply chains and short product development life cycles 5. High marketing communications spend 6. Quality consciousness and adherence to standards

Government Initiatives ( Cottage Industries Emporium, Khadi Gram Udyog, State Government Department) Strengths:1. Source of finances is fixed and subsidies boost these initiatives over time 2. Tie-ups with foreign governments facilitating permanent trade of national handicrafts. Weaknesses:1. Ambience-non-attractive to modern day shoppers are fed on the excellent ambiences of the retail formats. 2. Standardization defeats customization hands-down.

Designer Boutiques: (Ritu Kumar s, Ritu Beri s, Rohit Bal, Manish Malhotra, Sabyasachi Mukherjee, etc.) Strengths:1. Product customization facilities-extremely high 2. Highest level of customer intimacyRelationship marketing Weaknesses:1. Exorbitant prices-not meant for masses 2. Not a robust supply chainnot meant to be a panIndia operation

‡ Unorganized Sector:Mom-and-pop stores and local tailoring units:-

Strengths:1. Effective in addressing high geographical dispersion 2. Customization facility available...
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