A niche player in the market, Radhamani Textiles is working for some of the
most product focused companies in the world including Tom Tailor, Gaastra,
Napapijri, River Island , Zara man and boys, Jules, Camp David, sOliver to
name a few and even has its own brand POE. This Rs. 135-crore company,
which specializes in men’s shirts, has a consolidated manufacturing facility
at a 10 acre site near Bangalore with a manufacturing capacity of 3 million
pieces a year. Working on production systems that are generally seen in Italian
manufacturing companies and is unique to India, the company is getting value
from working directly with the customers, offering fabric development in quick
turnarounds. As manufacturing gets expensive, the company realized that
unit price, design, tight control on supply and manufacturing cost, and timely
deliveries contribute to the success story.
Design Values – Unit
Realization Escalation
“Since product development is at
the core of this company, a team
of designers led by me constantly
travels and interacts with
buyers to understand trends and
forecast collections. From the
colour palette to value addition to
detailing are evaluated for each
i ndividual buyer and collections
created keeping their market
segmentation and positioning
in mind,” says Manish Poddar,
Director, Radhamani Textiles.
On the basis of the design, Radhamani plans to bring in
more value-added brands in the
coming years, which then can
ultimately increase their unit
realization in the shirt
Factory interior of Radhamani Textiles
category. “Unlike industry norms where the shirt business has taken a beating in prices as buyers are always making a comparison with Bangladesh or other countries, we decided to stick to our core strength – design, and allocate more and more capacity directly to brands rather than to the price-sensitive buyers,” says Manish. This deep intervention in design has resulted in the company already hitting an
average realization price of $ 10
per piece, and which is expected
to go up to $ 14 next year, a way
above the industry average of
around $ 4 per piece.
The corporate culture around
the world is to spend 20 per cent
of gross profit on R&D, which
is unheard of in the garment
industry. However, Radhamani
tends to differ and to offer
product differentiation, it has
setup a world class design studio
at their corporate office and
allocated a defined budget for
product development and trend
search to execute collections.
“Our return on the investments
and new developments is almost
85 per cent,” shares Manish. No
wonder, Radhamani is catering
to most of the influential lifestyle
brands of Europe today and is
hunting for more.
Supply Chain
Efficiency
Today, all segments of the supply
chain has concerns of volatility
in their raw material supplies.
They need projections and
capacity allocations with good
financial backing to standby
the commitments; Radhamani
recognizes this and believes in
narrow and deep supply partners
to derive priority and service
for the ultimate customers. It is
an era of trust and partnerships
and Radhamani has imbibed the
same culture in its supply chain,
aligning with India’s leading
manufacturers for fabric. “Our
business is salesman sample
based and we need to give
priority to all our customers,
as all of them are participants
to most of the international
garment fairs at the same time.
Without a firm commitment
month after month, one cannot
expect service in today’s world,”
avers Manish.
Taking service to a higher level,
Radhamani also takes joint risks
with their customers in meeting
price points and developing/
customizing fabrics for them.
This allows the buyers to benefit
from quick response and faster
deliveries, based on pre launched
and approved fabrics. This
unique model of joint risk helps
both the buyer and the supplier
in today’s challenging markets.
Of course for such risk-taking,
there is a premium which
the company charges to the
customer for holding the fabrics.
“Yet 95 per cent of the times the
risk we have taken on fabric
developments have paid off,”
informs Manish. It is because of
this ‘on the toe’ service that the
fabric suppliers contribute to
Radhamani’s efforts to respond
to buyers’ demands, that the
company merely has a 0.35 per
cent airfreight contribution in a
turnover of Rs. 135 crore, which
is much below industry norms.
Manufacturing Cost
As manufacturing becomes
expensive, it is critical to
control prices to maintain
healthy bottomlines. Though the company manufactures high-end
garments with various prints,
value adds and embellishments
going into the products, a deep
study has gone into devising
a method to control the cost
of manufacturing. After a lot
of research, the company has
adapted a system which the
Italians call RELOOK and which
has been implemented in their
internal order processing,
buying and production
monitoring ERP system.
The production model is termed
as ‘Mother & Baby Model’ and
breaks down all the required
operations of a single style well
in advance. Within a mother bag
various components of a single
piece is placed attached with
a bar code. From time to time
various components from the
mother bag are sent for detailing
to various departments (printing,
embroidery, embellishment,
etc.) in baby bags and then
reunited in the mother bag after
the value addition is complete.
The mother bag is sent to the
production line for stitching
only when all other value added
operations are complete. With
this system their assembly line of 11-16 operations, on conveyer
maintains a throughput of 700-
800 pieces in a day. The in-house
capacity for printing, embroidery,
garment processing and laundry
supports the fast production, as
they don’t have to outsource any
of these value adding processes.
In this production module,
components of a style, which
is not planned for production
in a particular month or day,
could be still seen on the floor
being made like a fancy collar
or cuff for example. This brings
optimum utilization of manpower
of the facility at any given point
of time and no worker is left
without a job even for an hour.
This high inventory production
system is closely monitored by
mobile scanners on the shop
floor. Radhamani believes that
they are the only manufacturers
in India to have this unique
system as it is all developed inhouse
by them. The matrix of all
production status is monitored
and planned for the next day.
New Venture in Retail
Having learnt the retail side of
the fashion business working
closely with global partners on
collections, one of the Directors
of Radhamani, Mukesh Poddar
sensed that India created a
great potential for the type of
products that the company is
manufacturing. There were
many international brands
walking in and out of India with
no ‘sustainability’ due to price
points or fashion too ahead of
time, Mukesh gave shape to a
new business model, building
the brand POE. The first thing
that Mukesh realized was that to
nullify stock at the end of season
was a great challenge in Retail.
For this, an all India distribution
Manish and Mukesh Poddar, Directors, Radhamani Textiles
model was created so that stocks kept moving, whereby they were able to realize a turnover of over Rs. 30 crore in the first 1.5 years of inception of their brand. The retail venture is also a profitable way of clearing fabric developments that did not make their way into international collections.
Showroom at Radhamani Textiles
Besides distribution channels,
standalone stores were created
and to ensure interest in the
brand, a completely unique
concept was born. “We wanted to
give a plush and chic feeling to
our customers and at the same
time make fashion affordable to
them. The challenge was to make
this vision a reality, where we
could stand out in terms of our store appearance and carry a
signature presentation. Today we
have created a store which
is also written under copyrights
for the interior of our store,”
says Mukesh.
He adds, “Customers in India
are very shy to trouble the store
attendants, thus many a time
they do not open the garment and
try it out. We wanted to break
this wall of
reluctance, so our garments are all in the open, no packaging and free for everyone to feel them before they buy. Our display allows the view of the collection at a bird’s eye and freedom for us to demonstrate all the details of the garments, which cannot be possible in a packed format.”
Today in all the malls that
POE has standalone stores,
Radhamani claims that it has the
best sales realization per square
feet in that product category,
even though most of the stores
are on the 1st or the last levels of
the malls. “We plan to increase
the number of stores, but only in
profitable locations as we don’t
believe in opening stores for the
number game. In our business
plan we are also capable to
realize and shut operations of
non profiting stores,” reasons
Mukesh. Over the last 1½ years
the company has opened 8 stores
and this year also there are
plans to open 6 more stores. “We
have shown good margins in our
inception period itself due to
fast fashion inputs (every week)
and clearance of stocks from the
backend on weekly basis. This
year we shall also introduce
denims as we have been focusing
only on shirts and trousers up till
now,” says Mukesh. The brand
introduces 30- 40 styles every
month and each product is very
detailed, more than the products
made for exports.
“Retail is an investment into the
future and while the handwriting
for the casual shirts for
youngsters is very international
the price is kept just below a
thousand rupees to be affordable
to the segment that it is targeted
at. The vision is to have 100
stores in three years time,”
concludes Manish.
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