It took an American to appreciate the potential of desi art and craft to build a one-stop retail store for garments, fabric, furnishings and ethnic lifestyle product-that ranks amongst India’s best known and profitable brands
India's jaw-dropping diversity brought together a single platform that singular buzzword for colour, drama, ethnicity and the desi way of life The one brand that comes to mind each time you need the perfect wooden furniture for your new home--or take a gift for your friend abroad--a brand that not only sources its product through community-owned companies but actually has them on board as shareholders...
And to think an American entrepreneur started it all. As far as ironies go, this one's a beauty. A Rs.1,000 crore 'Make in India' story scripted by a foreigner, long before it was fashionable to do so.
John Bissel was born in Hartford, USA. His love for India thanks to his dad's account of India during World War II was married to his love of hand woven fabrics when he started work at the massive American chain Macy's.
Soon, he got his chance to marry his love of India with his love of textile when he was given a two year grant from the Ford Foundation to show Indian villagers how to make art and craft for export.
The experience taught him a lot: India had untold potential when it came to all things aesthetic not just the knowhow how to make the world sit up and take notice. With rare insight, he foresaw the enormous power of Indian textile and how it could be an opportunity to help the traditional artisans gain a dignified standard of life.
His grant expired, but his interest remained and he went on to start FabIndia Ltd in that bought local textile based items like rugs and carpets and exported them. The year was 1960. The business went from strength to strength and by mid sixties turnover exceeded Rs.20 lakh.
Gradually, he ventured into domestic retail in 1976 with its first store in Greater Kailash, New Delhi.
Today, it has over 180 stores across India and abroad, and managed by his son, William Bissel.
From textiles and handloom fabrics (upholstery and drapery, ready to wear clothing) to stationery, furniture, home accessories, ceramics, organic foods, and body care products, and home furnishings, FabIndia does it all.
It helped perfectly that the setting up of FabIndia coincided with the shift in European and American tastes abroad from the razzledazzle of synthetic stuff like polyester and nylon to natural textures and fibres.
“It was the best thing to happen to our business,” he said.
From textiles and handloom fabrics (upholstery and drapery, ready-to-wear clothing) to stationery, furniture, home accessories, ceramics, organic foods, and body care products, and home furnishings, FabIndia does it all.
In a major travesty of justice, it is an age-old fact that the village based artisan get peanuts out of their produce as the rest is taken away by the middlemen. To do away with this, FabIndia has brought in an artisan-shareholder system through "supply-region companies" incorporated as subsidiaries. Here the craftspeople collectively own 26 percent of the equity in each company, based in nationwide centres, with Artisans Micro Finance, a FabIndia arm holding 49 percent, and employees and other private investors holding the balance.
In 2005, FabIndia became a founder-member of All India Artisans and Craft Workers Welfare Association (AIACA), along with designers like Pritam Singh (Anokhi), Ritu Kumar, Madhukar Khera and Laila Tyabji. To mark its 50th anniversary in 2010, the company made all its 842 employees shareholders. As of today, FabIndia links over 55,000 craft based rural producers to urban markets, thereby creating a base for skilled and sustainable rural employment.
Over the years FabIndia has consistently and willfully distinguished itself from the competition. Urban India has been as much on their radar (especially since William took over), as has the export market.
On the one hand, their in-house designers have been asked to modernise and update their line of home-linen, ready-made garments keeping in mind the tastes and preferences of urban India in a manner that is both appealing and affordable.
On the other, their artisans are taught the basics of quality control, the importance of finish and attention to detail that make all the difference between a good piece and a great one.
By 2014, FabIndia emerged as one of India's two most profitable ethnic wear and goods brand with over Rs.54 crore in net profit.
According to executive director Sunil Chainani, "We did not discount our stuff just to meet a top line. Workable businesses need profits and cash flow. For instance, we steered clear of opening stores in prime locations and top notch malls as the rentals would have impacted margins."
FabIndia also make nearly 90 percent of itsmerchandise in house, helping to keep inventory tight and costs under control.
On the other hand, most brands in the same category have been offering steep discounts to move unsold merchandise, resulting in the depletion of profits and more than a fifth of sales taking place during end- of-season sales (which is not a good thing).
A major controversy arose in early 2015 when Union HRD Minister Smriti Irani spotted a camera positioned to record near a changing room at a FabIndia outlet in Goa. She called the police. However, the courts reprimanded the cops for acting in haste and arresting four employees arbitrarily.
Despite its strong position, the brand faces stiff competition from western wear and foreign brands and has to be on its toes all the time. Also, it does not advertise and focuses on word of mouth. Question is: will it continue to work in the days to come? Besides, a few years ago, the company had acquired UK-based apparel brand, East which did not do well. "The trouble with East was that the styles were too western," said CEO Subrata Dutta in retrospect. Recently with an idea to cater the modern Indian youth and also the international buyers who are fond of Indian textiles and clothing, FabIndia launched a western wear brand 'Fables'. The brand was first launched at Fabindia’s Connaught Place store in Delhi but later on, was made available all over the country. Dutta hopes that Fables would contribute at least 10 percent to the company's revenue within the next 18 months.
An average Fable garment is priced between Rs.2,000 to Rs.5,000. But despite the winds of uncertainty and unforgiving competition, ever FabIndia is in a stronger position at most and is one of the brands to watch out for.
Being desi sure looks good.
By Kalyani Sardesai
