Interview

‘Customised corporate apparel opens up a new market’

Customised apparel is a new dimension to the institutional sales concept in the garment sector, says Mathew Jacob, General Manager (Institutional Sales), Madura Garments in an exclusive interview with R Baby Manoj

What do you mean by "institutional sales"? How is it different from the usual retail business of Madura Garments?

'Institutional sales' is basically a business-to-business association with a corporate. It could be a company or any other institution. An institutional sale is different from our core business focus - that is, retail. The difference is that in institutional sales, end consumer is a corporate. Corporate requirement is quite different from that of an individual consumer. The retail consumer buys into a specific brand or collection, or chooses a brand from a cluster of brands while visiting a shopping mall. While this is considered decision, the brand has to prepare for the product almost a year in advance to research the colours and styles in fashion and designs a package, which the consumer sees in the store. In short, the retail cycle from concept to sale often begins a year in advance. The corporate requirements are in contrast always "last minute"- Typically about 10 days before the event for which it is needed. The event could vary from a corporate get-together, a team meet, an out-bound training program, a sporting event etc. These are occasions in which the organization seeks to re-enforce a theme or simply the brand identity with its employees and other stakeholders.

The other segment, which is much larger, is the "uniforms" segment. This is typically large volumes and competitively priced.

What is the size of the 'institutional sales' market?

The market is estimated to be over 3000 crore for a combination of various products. While this offers a prospective alternate channel of distribution for apparel companies, it is a very difficult segment. In Madura Garments, we have chosen to restrict our foray to the more discerning corporate customer, who insists on a superior offering which only branded merchandise can provide. We have consciously not targeted the "uniforms" business, which is largely a commodity business.

Do you customise all your brands incorporating customer logo/legend for institutional sales?

Among many of our brands 'Byford' gives the option of customisation. Under Byford brand we give customised products including shirts, trousers, T-shirts, jackets, and the like. 'Byford' has been one among the top five T-shirt brands in the country and is recalled even today after almost 3 years since we have withdrawn the brand from the retail market. Even internationally it was a very strong brand, especially in the far eastern markets and the Middle East.

What is the minimum order required from a corporate/institution for institutional sales?

Normally we expect a number of 200 - 300 units in a single order. It takes 2 weeks to deliver the customised products. Some corporates are very particular to retain their brands and we need to put their logo on the apparel. For such requirements, Byford is our lead brand where we customize the garment for the client. However, there are others who want to associate with our brands like Van Heusen. In which case there is no customization (or minimum customization in packaging etc)

Our clientele includes over 300 of the top corporates mostly in the large metros. They include among others, ICICI Lombard, SAP Labs, Siemens, ABB, Samsung, Mankind Pharma, Dr Reddy's etc. The quantity can be as low as 100 for a single order.

What is the share of institutional sales in the total revenue of Madura Garments?

At the moment, the share is less, since the institutional sales is just one year old. However, in a matter of three years, the share should go up to 10 per cent of the total business. We have a road-map towards this goal. But the corporate sector is very dynamic. You can have big spurts and then quick slumps. You may get a fifty thousand pieces order suddenly then one month may go dry.

Are there any plans for overseas markets in this segment?

As of now, we do not have any plan to serve the overseas market through our institutional sales set-up. There are certain difficulties. The tastes of the people are different and also the sizes of the people. Yet another major problem is the lead-time taken because of shipment. However, in future, we may venture into those markets.

You are also the sourcing head in Madura Garments. Could you explain what does the term 'sourcing' stand for?

Most of the big corporates are outsourcing their requirements. The largest retailer in the world 'Wal-Mart' is outsourcing almost their entire product portfolio from brands or manufacturers with almost "virtual" supply chain models. In Madura Garments too outsourcing takes place, however, to a smaller extent. Even though we are manufacturing a whole range of clothing including shirts, trousers and suits, we outsource seasonal products like woolen jackets, leather accessories, etc - this is sourcing.

Won't outsourcing have a negative impact on quality?

If managed well outsourcing does not necessarily mean poor quality. In fact outsourcing with specialists can in fact give you a quality and cost advantage. In our case we have a parallel product development team, which is constantly working on development of all key inputs, which go into the finished product, be it the yarn, the knitting specifications, the dyeing and processing parameters etc. We also work with chemical and processing technology companies and work to incorporate cutting edge technology with our outsourced vendors. We strictly ensure the quality of inputs going into the products used in the manufacture of outsourced items. There is a continuous process of audit to ensure quality. Our own quality auditors in the factory examine the way outsourced items are being manufactured. Outsourcing gives us the flexibility of a diverse product basket without being constrained in any manner.

In Madura Garments there are two approaches. One is the brand approach. There is a brand team that handles all the products of the portfolio. The team comprises of product, communication, purchase, design, and logistics personnel. In the case of the category approach, a specialist product team is set up which looks after all aspects of that category across brands. Currently in Madura Garments, suits and innerwear is handled as a category.

Don't you find difficulty in positioning various brands?

Not at all. We have been quite successful in positioning our brands. This is evident from the performance of these brands. Each of them are lifestyle brands. Peter England is much widely distributed. It is the volume and turnover driver. Louis Philippe, Van Heusen and Allen Solly are more in the premium segment as fashion brands. However there is a process of integration of all elements of products, be it packaging, communication to the stores, or visual merchandising.

Do you export your retail products?

We have restricted the export of our own branded products to the Middle East, Sri Lanka and Bangladesh only. We have another division called 'Contract Exports'. That is exports in other brands. Our contract export is mostly to Europe and a small quantity to the US.

What are the challenges you face in the garment business?

Customer understanding about the process of making customized products is a challenge. In most cases of institutional business, the corporate take a lot of time to take a decision. Once the decision is taken to place the order, they want the delivery immediately!

What does Madura Garments want to convey through the on-going 'Solly at work' campaign?

The Allen Solly began the concept of "Friday dressing" which re-defined work wear. The current campaign "Solly at Work" takes this further by taking the workplace out of the typical cubicle to the unconventional careers of a sports manager, stylist etc which is reflected in the Allen Solly range of products, which is work wear yet different and more casual.