FAB INDIA CASE STUDY Pdf

Topics: Quality control, Management, Retailing Pages: 5 (1029 words) Published: January 14, 2015
GUIDELINES:

1. 5 minutes will be given for post discussion.
2. 15 minutes will be given for presentation.
3. Idea should be presented with the help of 12 to 15 power point

slides.

Weaving Scale into Hand Made Products

FabIndia is a well-known retail brand that sells various hand made products through its stores across India and overseas. They are probably the best-known urban middle class brand in India. It would not be wrong to say that they define the middle class look for Indians. Though they are best known for home linen and garments, they have expanded into organic food, personal care products, furniture and Jewellery. This 50-year-old company started as an export house, exporting Indian hand woven fabric to the developed markets in the west. In last 15-20 years the company has completely transformed itself into a chain of retail stores with more than 90% of its revenues coming from domestic markets. The company has been able to turn around and achieve rapid growth due and its innovations

are
worth
exploring.
Founded in 1960
1975: First retail store in Delhi
1993: Second retail store in Delhi
1996: Third retail store in Bangalore
2000: Non-textile range started
2004: Organic Food introduced
2006: Personal Care products, ~60 Stores

To understand how FabIndia
2008: Handcrafted Jewellery
operates,
we
need
to
understand the community- 2010: 120+ stores including 6 overseas based businesses. In this
model companies source products from communities that are traditionally well versed in a craft and make products using this skill. They are not formally trained, but they inherit this knowledge from their families and continue to pass it to the next generations. They usually operate in a small geography and have very limited access to the broader markets. Companies like FabIndia act as intermediary and take their products to the urban markets worldwide. There are many examples of the successful businesses built around communities like Amul that deals in dairy products and Jaipur rugs that deals with handcrafted carpets.

John Bissel started FabIndia
in 1960 in New Delhi as a
company that worked with
Revenue Rs 350 Crores
various weavers across the
200,000+ SKUs
country
and
developed
fabrics that were sold to
40,000+ rural producers
retail stores in western
markets. For almost 30 years
95% revenue from domestic sales
they kept growing at a
steady pace adding both the
Wholesale exports to 33 countries
suppliers and customers to
their kitty. They started their
850 direct employees and 1000 consultants
first store in 1975 on an
17 Supplier Region Companies
experimental basis which
was a big hit, but the focus
of the business still remained exports and that is where the maximum revenue came from. In early 90s when the Indian economy was liberalized and India opened itself to the world, the scenario began to change for FabIndia. Their customers now wanted to work directly with their suppliers. This was because they had an easier access to these suppliers, suppliers by now well versed to weave for the western tastes and also the volumes needed made sense for them to set up their own shops in India. On the other hand, Indians started making more money and were willing on spend on the merchandise sold in FabIndia Vital Stats:

stores, which till then was one of the few organized retail stores selling products made out of Indian hand woven fabrics.
By this time FabIndia’s baton had also moved into the hands of John’s son, William Bissell. It was more or less imperative that company has to change its focus from exports to domestic market for the reasons mentioned above. But the challenge was how to achieve scale in this business. The brand was built on hand made products, which could not be changed. For a large-scale supply of products, not only you need to work with many more communities in rural areas, but also ensure a consistent quality of products. Quality assurance in...
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