Logesh Project

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1. Executive Summary
The Apparel Industry has been seemingly proliferating with the growth. With economic
development there has been an increase in the private consumption and growth in
GDP; as the demand from the fashion and ready-to-wear industry has increased
significantly.
Both the global and European markets for branding and design are growing. Brands
owners are increasing their investments in measures intended to contribute to
strengthening their brands, in which labels, packaging and accessories are important
elements.
Wadhwa Group is a company in this industry offering apparels i.e. Shirts with a clear
focus on offering customer unique solutions that create added value.
To compete for the big branding and design jobs and increase the company business
volume it is necessary to be close to the customers. Developments necessitate
Wadhwa Group being present in the countries where its customers have increased its
manufacturing base. This caters the need to make an entry into new markets through a
network of strategic partners. This has motivated Wadhwa Group to establish its line of
shirts as Wings with its own sales and logistics base in Mumbai.
This portrays the need of Wadhwa Group to develop its market through continued
optimization of its business structure and improve return on investments in India. The
aim of this project report is to make a feasibility report for Wings for its expected market
introduction in the Indian market.
Logesh Joshi – MMS 2009 – 2011/23

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2. Objective Of Project
 To study apparel industry in Mumbai for launching new brand of shirts.

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3. INTRODUCTION OF INDIAN APPAREL INDUSTRY
An Overview
Increasing international competitiveness of India in the Apparel Sector has been for the
reason that its full supply chain – from a huge raw material supply to high quality
completed products, near to the ground labor costs and experience, entrepreneurship
and design skills which Chinese firms find difficult to match. The industry is also
extremely flexible – from flexible smaller firms presenting efficient solutions for smaller
orders to giant firms; having the ability to service the world‟s biggest buyers. The Indian
economy has also opened up to the outside world and foreign investment &
opportunities have increased due to changing government policies. New capacities are
being built, and competitiveness is improving as new technology and expanded
capacities are installed at a dramatic rate. Leading foreign retailers and apparel brands
are taking advantage of India‟s strengths as an alternative to China and other countries
for their sourcing requirements. This is being supplemented by the growth of the Indian
brands increasingly to high standards.
It has been estimated that India has approximately 30,000 readymade garment
manufacturing units and around 3 million people are working in the industry. these days,
not only is the garment export business growing but many leading Indian fashion
apparels are also coming up as major supplier of high quality fashion apparels and are
appreciated in major markets internationally. Consistent efforts towards extensive
market coverage, improving technical capabilities and putting together an attractive and
wide merchandise line has paid rich dividends. But till today, our clothing industry is
dominated by sub-contractors and consists mainly of small units of 50 to 60 machines.
India's supply base is medium quality, relatively high fashion, but small volume
business.

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To cut a long story short, the Indian Textile & Apparel Industry should also go in for
systems integration to meet increased price competition, and increased pressure to
shorten the fashion cycle with shorter production cycles that will provide it greater
connectivity and visibility, and enable it to adjust to retailers' needs and provide value-
added services. Overall, the Indian Textile & Apparel Industry is proliferating at a rapid
rate.
For building Indian brands in global apparel market it is necessary for marketers to
increase the value of their products by branding. It is evident that there are still only a
few apparel exporters able to create a brand in the global market except the supply of
international buying houses or retail chains as per the specifications and designs
provided by the buyers putting apparels or brand name as stipulated by the buyer
wherein the exporters voluntarily hide their identity in the global market. Although, the
Indian apparel exporters do have the capability to produce as per the requirement of
global market, their main drawback lies in strategic thinking in creating their own brands.
Moreover, many global brands are also entering the Indian market, making Indian
brands clueless as to how to survive the competition. This situation necessitates the
marketers to strengthen their brands for their stay in the market. This might be possible
only when the marketers consider branding not as a set of activities, but as a strategic
thinking.
To compete in domestic as well as global market place in the long run, the marketers
must create and manage strong brands - vital in creating loyal customers which would
pose a formidable defense in the competitive market. Branding requires putting
conscious efforts to build the society‟s perceived value of the product based on
components such as reputation, experiential and symbolism.

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4. RESEARCH METHODOLOGY
The secret of success is constant purpose
– Benjamin Disraeli
Project Strategy
A feasibility study will look at the viability of an idea with an emphasis on identifying
potential problems and attempts to answer one main question: Will the idea work and
should i proceed with it?
Project Approach
In developing the business strategies for Wings it is vital to concentrate on the following
aspects:
1. Identification of the present market situation and trends – PEST Analysis
2. Determination of the condition of the Apparel Industry in India
3. Determination of the planned strategies of Wings
4. Identification of the competitors of Wings and preparation of SWOT analysis for
them
5. Development of SWOT of Wings in response to this analysis
6. Risk Assessment Study of Wings– identifying the risks in its business introduction
with current strategy in the market perspective of Mumbai City
7. Risk management and development of a proposal for Wings of future business
strategies to be followed.
Data Collection
This project is the mixture of theoretical as well as practical knowledge. The

secondary data required for the project was collected from various websites.
The project started with sorting all the raw data and arranging them in perfect order.
To add value to the project and to understand the practicality of apparel industry,

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5. MARKET SURVEY & EXTERNAL ANALYSIS
PEST Analysis of Indian Market for the Apparel Industry

Political Factors
(Government policies related to the industry, tax policies, laws and regulations, trade
restrictions and tariffs etc.)
The Government of India (termed as GOI from now onwards in the report) has helped
the textile and apparel industry adjust to the new trade environment. In 2000, the GOI
unveiled its National Textile Policy (NTP) 2000, aimed at enhancing the competitiveness
of the textile and apparel industry and expanding India‟s share of world textile and
apparel exports to 10 per cent by 2011 from the current 3 per cent level. Some of these
measures taken by the GOI were substantial to facilitate the Brand Accessory Industry
too -for brand value addition. Under the NTP 2000, the GOI removed ready-made
apparel articles from the list of products reserved for the SSI sector. This policy equally
holds strong for the Apparel Sector. The GOI grants automatic approval within 2 weeks
of all proposals up to 51 per cent in the manufacture of textile products.
Tax Policies
India has a well-developed tax structure, with the authority to levy taxes divided
between the Central Government and the State Governments. The Central Government
levies direct taxes such as personal income tax and corporate tax and indirect taxes
such as customs duty, excise duty, central sales tax and service tax. The states are
empowered to levy professional tax and state sales tax apart from various other local
taxes like entry tax, octroi, etc. Foreign collaboration and investment are subjected to
direct and indirect taxation, though indirect taxes such as customs, excise and sales tax
do not affect the income stream of the investment the impact of income-tax is a crucial
area which determines the investment strategy of the investor. Tax policies are also
important to be intervened in effect to the apparel Industry.

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Economic Factors
(Changes in the wider economy such as economic growth, interest rates, exchange
rates and inflation rate, etc) With the economic restructuring and liberalization of the
Indian Economy since 1990, India anticipates the fastest period of growth with long-term
sustainable market expansion, higher manufacturing output and investment
opportunities. Economic reforms brought by the GOI were initially centered on:
• liberalizing procedures for industrial licensing and investment

• reduced role of public sector in the nation‟s economy
• lowering of import duties
• easing import licensing requirements
• relaxing controls on foreign direct and portfolio investment, and
• improving operations of capital markets
The structural transformation that has been adopted by the national government in
recent times has reduced growth constraints and contributed greatly to the overall
growth and prosperity of the country. However there are still major issues around
federal vs. state bureaucracy, corruption and tariffs that require addressing. During the
period of stable growth, the performance of the Indian service sector has been
particularly significant. The contribution of the service sector was at 57 per cent in 2009
- 2010 of GDP. The industrial sector in the same period accounting for 28 per cent of
GDP. Growth in the manufacturing sector has also complemented the country‟s
excellent growth momentum rising steadily from 8.98 per cent in 2005, to 12 per cent in
2010.

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Social Factors
(Health consciousness, population growth rate, age distribution, changes in tastes and
buying patterns, etc.)
Indian economy is increasingly becoming plutonomic, a term coined by strategists in
2010, where growth is powered by and largely consumed by a wealthy few. In simple
terms, rich consumers that are few in number but comprise a disproportionate share of
total income and consumption, drive spending.
In India wealth has been concentrated in a small percentage of the population, with
positive demographics, buoyant economic growth coupled with the effects of wage
inflation which have resulted in India registering one of the fastest increase in high net
worth individuals (HNIs) in the world. It is estimated that in absolute numbers, by 2025,
India‟s wealthiest citizens will total 24 million. HNIs or individuals with financial assets
over US$1mn have risen to 83,000 with a growth rate of 19.3 per cent.
Recent surveys have revealed that currently there are 1.6 million households earning
over INR 4.5 million (USD100, 000) per annum spend INR 0.4 million (USD 9000) of
their income each year on luxury products; thus resulting in a market size of about USD
14.4 billion for such products.
Consistent with Mckinsey Reports, it is expected that over the next two decades, the
country‟s middle class will grow from about 5 per cent of the population to more than 40
per cent, being the fifth largest consumer market with huge private consumption.
This characterizes the fact that the Apparel & Fashion Industry in India is diverse,
concentrating on different target segments as the general rising middle class segment
and also the elite class people. This accounts for the growing market for both
International and Domestic Retailers and brands with different fashion portfolios
encouraging the Apparel Industry.

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Technological/Operational Factors
(Application of new inventions and ideas such as R&D activity, automation, technology
incentives and the rate of technological change)
On April 1, 1999, the GOI implemented the Technology Upgradation Fund (TUF) to spur
investment in new textile and apparel technologies. The apparel and fashion sector is
liable to receive coverage under this scheme for its production– which requires much
technological up gradation and textile machineries.
Under the 5-year USD 6 billion program, eligible firms can receive loans for upgrading
their technology at interest rates that are 5 per cent lower than the normal lending rates
of specified financial institutions in India. According to GOI officials, this interest rate
incentive is intended to bring the cost of capital in India closer to international costs.
The RBI has also given automatic permission for foreign technology agreements in all
areas of electronics (related to RFID) provided the technology price does not exceed
USD 2 million and royalty payments do not exceed 5 per cent of domestic sales.
Review on Business Setups in India
Business Setup Format

The following formats of business setups are common in India:
Branch office
Companies engaged in manufacturing and trading activities may open branch offices for
the purpose of undertaking export and import of goods, rendering professional or
consultancy services, carrying out research work, promoting technical and financial
collaborations between companies and parent company or overseas group companies,
representing the parent company in India and acting as buying and selling agents, and
rendering technical support to the products supplied by parent/group companies.

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Project offices
The project offices are ideal for companies to establish a business presence for a
limited period of time essentially set up with limited purpose of executing a specific
project. Companies engaged in turnkey construction or installation normally set up a
project office for their operations.
Liaison office
Liaison offices are generally opened in India by foreign companies to promote its
business interest, awareness of products, explore further opportunities and act as a
communication channel between various Indian companies and itself.
Liaison offices are not allowed to carry on any commercial, trading or industrial activity
or earn any income in India. It is required to maintain itself out of inward remittances
received from abroad through normal banking channels.
Joint Venture
These companies may be established either by incorporating a company in
collaboration with a partner (such companies are predominantly private companies) or
with the general public (such companies are necessarily public companies). When the
contribution is in the form capital participation, the usual form of the venture is joint
venture.
Basically the organization that suits a joint venture is a company organization. The
experience shows that the most preferred mode is to set up a private company because
under the Indian company law a private company, unlike a public company, is exempted
from lot of legal compliance and statutory filings. Due care should be taken while
forming JVC with respect to the controlling interests and rights of the participants.

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Formation & Management of Company

The formation, incorporation, operation and management of companies in India are
governed by the Companies Act, 1956. For commercial joint ventures in India, two types
of companies limited by shares can be incorporated, viz; private company and public
company. Thus foreign may incorporate either a private or a public company for
commercial venture. For forming public company minimum 7 persons and for a private
company minimum 2 persons are required.
Fringe Benefit Tax

As per AY 2009-10
Fringe Benefit Tax on the value of certain fringe benefits provided by employers to their
employees to be abolished.
The under mentioned expenses will be excluded from Sales Promotion & Publicity:
 Expenses on display of products.
 Expenses on distribution of samples, either free of cost or at a concessional rate.
Dividends
Dividends can be paid only out of the profits of a year, undistributed profits of previous
years. Dividends received in India can be repatriated subject to compliance of exchange
control formalities.
Bank Account Operations & Loan Syndication

A joint venture company or a wholly owned subsidiary, being a company incorporated in
India, can open a Bank account in any of the Bank registered with the Reserve Bank of
India. Banks in India are now well equipped with latest technology banking systems like
net banking facility, third party transactions, ATM, international transactions, direct
money transfer, D Mat accounts for shares, etc. Therefore opening a bank account and

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its operations has become very simple and depending on the internal systems the
company may design the mandate for its operation.
Long and medium term financing and loan syndication for business development is
possible from an integrated network of financial institutions and banks by ways of
project loans, underwriting, deferred payment, guarantees, leasing, venture capital, and
a variety of other financial products
Import/Export
Import/export procedures are much more relaxed compared to earlier restrictions and
GOI is in the process of further relaxing the norms to make it globally competitive.
Authorized dealers may freely extend letter of credits and send remittances for imports.
It is essential to create an atmosphere of trust and transparency and simplify
procedures to bring down transaction costs during import/export to facilitate
development of India as a global hub for manufacturing, trading and services.
It is also important to identify and nurture special focus areas which would generate
additional employment opportunities facilitating technological and infrastructural
upgradation, especially through import of capital goods and equipment, thereby
increasing value addition and productivity, while attaining internationally accepted
standards of quality. But it is to ensure that the domestic sectors are not disadvantaged
in the Free or Regional Trade Agreements entered into in order to enhance exports;
avoiding inverted duty structures.
Special Economic Zones (SEZ)

The GOI‟s introduced policies for setting up Special Economic Zone (SEZ) with a view
to facilitate Indian Industry with an internationally competitive and hassle free
environment for exports. SEZ can be used to set up manufacturing operations and
rendering of services. They are specifically defined duty free zone and are deemed to
be a foreign territory for the purpose of trade operations and Government duties etc.

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There were some blocks in the smooth implementation of the policy therefore to
overcome these roadblocks and to give a long term and stable policy framework with
minimum rules and regulations, the SEZ Act, 2005 has been promulgated. The
provisions of the Act regulate the legal framework and regulatory aspects of SEZ
development as well as for enterprises operating in SEZs. There are 42 Special
Economic Zones in various parts of the country in the private/joint sectors or State
Government. It is essential that the SEZ units are positive Net Foreign Exchange Earner
within 3 years with proper maintenance of accounts.

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6. BUSINESS OVERVIEW OF WINGS
What is driving Wings?

Brand Profiling is the key word associated with the demands from the Apparel Industry.
Brand Profiling goes a long way in establishing the brand consistency and value
propositions. Product portfolio of Wings builds up a brand personality that
communicates the values and strengths of the company. Designing of different aspects
of brand profiling is done based on in-depth study of the company, its vision, prime
customers, target market, their perception and competition.
Wings is anticipated to be a tertiary player in the fashion supply chain relationship

between the buyer and seller with the primary motive of its business and that of the
industry is value enhancement/addition by developing the concept of the brand product
line. Every product line has its own design concept and this is strengthened by Wings‟
supplementary concept build-up by analyzing the market trends & needs and exploiting
the emotional and self-expressive benefits differentiating the product line of the brand
from others. Wings believe in illustrating the brand experience or concept by fortifying
the personality of the brand. Brand profiling for Wings serves to achieve unique selling
propositions (USP) or better termed as the emotional selling proposition (ESP) for a
wide range of products to entire regions.
How accessible can Wings be in the mainstream?

In the close meshed matrix of value vs. volume in the polarized market, it is a strategic
vision of positioning the company based on necessities and strengths. Accessibility of
Wings in the market providing it with sustainable competitive advantage is based on its
high value apparel and not much on controlled product low pricing.

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Is Wings broadly based?

The most critical factor behind the success of a firm is to classify its core identity
elements. Wings has several core assets that can be exploited to achieve future growth.
In view of the development of the core and extended identity of Wings it would prioritize
four criteria as (i) differentiating itself from competitors through ESP, (ii) resonating with
the target group – understanding the drive behind the customer‟s motive, (iii) reflecting
the strategy and culture of the business and (iv) Providing parity in attributes where
competitors have an advantage.
It is evident from the analysis, that the maximum profitability can be perceived with high
product price level and at the same time with increment in the volume of business. A
combination of the two in the right degree is a requirement as increase in volume helps
to attain economies of scale resulting in the decrease in direct costs and overheads
(working capital), also.
Vision and Wanted Position

Wings should avoid ending up in a situation where:
• The smaller players are more attractive than Wings due to more value-added offers
• The major players are more attractive than Wings due to a more attractive
production and logistics set-up and lower prices.
Therefore, Wings has to identify a sustainable competitive position. The first step
towards the vision shall be the main focus over the coming 2-3 years. During this
period, Wings would strive for a market position where:
• The customer offer is superior to that of the major players in terms of

- Higher branding and design competence
- Higher degree of service and flexibility to customer needs

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• The production and logistics set-up is superior to that of smaller players in terms of:
- Production network offering closeness to the customers´ own production sites

- Streamlined logistics solutions in terms of infrastructure, processes and
supporting systems
It is essential to exploit this market position by duplicating it on other markets, by

leading a consolidation of the market.
Market Positioning
A firm‟s competitive advantage and its product‟s position depends much on how it is
defined by consumers on important attributes – the place the product or in totality the
company occupies in consumers‟ minds relative to competing products. Information
overloading makes it difficult for consumers to re-evaluate their buying decision every
time.
To simplify this product positioning based on a complex set of perceptions, impressions
and feelings for Wings - this report takes into consideration, the perceptual mapping that
Wings has done of itself.
“When absolute superiority is not attainable, you must produce a relative one at the
decisive point by making skillful use of what you have”
– Karl von Clausewitz, On War, 1832

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Current Positioning of Wings India

Wings India Current Business Strategy
The current business strategies as perceived while conducting the project Work can be
summarized as follows:
Production, Marketing & Services

1. Marketing Management - Wings in India predominantly follows a mixture of product
concept and marketing concept. Wings India‟s organizational goal depends on
determining the needs and wants of the target market in India (retailers and brand
owners) and delivering the desired satisfactions more effectively and efficiently than
competitors. According to the product concept the company favors products that
offer the most quality, performance and innovative features through conscious
product improvements.
2. Market positioning and Target segment - Wings will continue development of its
production/manufacturing facilities accordingly. Constant R&D works and innovation
helps to diversify its product portfolio. It will take help of its local sales team to
develop its services in terms of marketing of its products.
3. Motivations - Wings‟ strategy is to develop a potential market through wider global
brand association, global innovation, access to low-cost labor or materials, and
strategic access to business incentives, subsidies and overcoming trade barriers
and fostering good-will through effective joint venture.
Logistics, Stock & Distribution

1. Logistics system - Development of RIS & ERP system in context to the Mumbai
market and incorporating it in the total solution of Wings on a real time based web-
order platform. Wings‟ functioning also depends on the efficiency of the courier
service companies for on-time delivery of its products to the store bases.

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2. Favorable market factors - For Wings the knowledge of local language, in contact
with manufacturer, and close location from clients sourcing base & of stock avoiding
long transport and quick dispatch and effective courier service are positive attributes.
3. Order Management - Maintenance of stock for the customers depending upon
forecasting of sales as no contracts exist between the clients and Wings on assured
agreements.
Finance
1. Banking Operation – Wings will open up its own banking operations and
transactions in Mumbai to reach the customers on time and make investments on
requirements, promptly without waiting for long dealings from the main office.
2. Reduced direct costs - Wings has improved the operating profits by reducing
fixed cost structure which has contributed to turn negative results into attractive
profit levels.
Wanted position – Wings

Wings have to look after two different perspectives – yet so conjugate.
o Develop a clear framework of its own wanted position
o Develop a strategy helping Wings develop its position nationwide
From the perspective of Wings it is evident that profitability and growth of the entire
organization would be reflected on it. Wings‟ market position is to some extent would be
similar on different geographical markets, and to some extent different on different
markets depending on the market factors and competences. This has help determine
the market positioning for Wings in particular.

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As described earlier, the market is becoming increasingly polarized. The major players
are moving to the bottom right corner, and the smaller players find niches at the left.
Wings‟ current position will be somewhere in between. It has an attractive production
and logistics offer relative to the smaller players, but a significantly less business
volume than the major players in the Indian market.
It is also important to note the fragmented positioning of the Indian domestic apparel
producers. They are dispersed in the market considering their volume, strategy,
products & services. There are certain comparatively bigger players with established
production bases with varying level of product assortment depending on what clients it
serves. Many such companies are exporting to International retailers or supplying to
their local bases with high degree of value addition and brand management. Moreover,
they possess knowledge of the retailers and brands and render services to them
depending on the trends. There are some companies which are not big enough due to
lack of investment but are quite innovative and value adding for the Indian fashion
market. Others can be characterized as small or medium- sized enterprises (SME) with
low level of product diversification clustered in the left hand bottom segment of the
graph.

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SWOT Wings– Analysis
STRENGTHS
Capabilities
Wings is a potential apparel manufacturer on its way for market introduction in India. Its
true capabilities lie in its efficient service - sales, distribution, and stock management
with close alliance of its management teams.
Competitive advantages
Competitive advantage lies in the following ways:
o Thorough know how of the Indian market in terms of business ventures, product
requirements of the vendors, economic production system through better local
communication
o Less business and setup costs due to already developed infrastructure for local
production and distribution
Resources, Assets, People

Though resources are quite nominal for Wings India but it is strategic. Wings India will
have its own production or manufacturing set-up in Mumbai which reduces its fixed
operating expenses - infrastructural, developmental, real estate costs etc. – thus
possible depreciation. This lowers the liabilities and property, plant and equipment costs
considerably.
Marketing - reach, distribution, awareness
Wings believes in marketing of its products with the help of its sales team to the vendors
but mostly counts on the efficient marketing by the experienced sales team for more
approved nominations. In Mumbai, Wings mostly plans to be away from the
international market services and to maintain its high brand personality. With its office in
Mumbai Wings will be able respond to the customer queries efficiently.

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Location and geographical

Wings office is located at Mumbai. Geographically the manufacturing location will be
strategic as it will be in a special economic zone – with industrial exposure and facilities
like tax free liabilities for business set-ups. Mumbai is at a special location logistically –
with extensive business coverage, investment opportunities and transport connectivity.
Price, value, quality
Wings India‟s strategic advantage lies on the value addition and the quality of its
product. Wings offer its apparels concepts to the market in Mumbai. Opportunities are
ample to diversify and increase the client base. The unique branding concepts of Wings
stand out to be its strength parameters. Wings also ensures its quality via a step-by-
step process through in-process quality inspection system along each phase of the
manufacturing process – weaving, finishing equipment, cutting and folding and finally
during packaging.
Processes, systems, IT, communications

The in-house production processes for Wings are quite competitive along with the
services of logistics, distribution and stock done under its own expertise. This is
supported by the strong local presence of Wings through its parent company and its
enduring market experience. The IT support system along with the RIS is on a
developmental spree for Wings.
Innovative aspects
Innovation is a major strength for Wings considering its new service developments in
apparel, total brand management, security and anti-counterfeit appareling. It has also
made sufficient advances in developing the versatility of its product range,

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WEAKNESSES
Gaps in capabilities
Considering the relatively new business venture in the market there are certain
breaches in the functioning and business totality for Wings. These are pertaining to the
knowledge development of the local market for proper logistics and distribution though
the parent company is a veteran player in the Indian market.
Lack of competitive strength
o Anticipation of lack of market penetration due to developmental problems in the
initial stage
o Inability to reach the retailers and brands due to comparatively virgin presence in
the market – the big International apparel providers and Manufacturers like Arrow,
Parx, Allen Solly etc. have long term presence and setup in the Indian market with
own manufacturing bases too. This provides them an edge to sell at very
competitive market price and total control on the production management to alter
the manufacturing cost.
o Lesser brand Identity revelation due to initial stage of its business setup in India
Reputation, presence and reach
Wings is still not introduced in the Indian retail perspective chiefly because of (i) the
apparel industry is still in its initial stages due to the fact that nearly 95 per cent of the
Indian retail market is still unorganized and non-clustered (ii) Indian retailers go for their
branding internally for targeting the domestic market as they have better knowledge of
the market trend and target group preferences (iii) targeting the Indian upper market
would be costly and would enhance the product price – not profitable for targeting the
Indian this segment (iv) The big Indian Retailers‟ and brand owners‟ attempt to emerge
internationally could be supplemented by Wings‟s solution but that is still a tentative
prospect considering the scopes for expansion in the domestic market easier and still
substantial.

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* More realistic would be to develop the business for the small and medium sized
Retailers and Brands trying to make an entry into the Indian market without proper set-
up bases and Indian market related trends in its product portfolio.
Timescales, deadlines and pressures
o Pressure on the apparel, packaging and accessories industry due to the quick, short
lived fashion change and retail boom resulting from GDP hike and increase in
private consumption.
o The increasing competition requires just-in time production. However, the lack of
own production facility can initially create production management and operational
problems.
o For capacity without stock the production time is long.
Financials & Cash-flow
Wings banking operations can sometimes be hindered due to increased capital
transaction processing time. This is subsequently because of comparatively lesser use
of internet banking facilities in India, still, and complexities related to multiple banking in
between – to be sorted out soon with opening of Wings India‟s own banking operations.
IT developments
The variable data solution – RIS (Retail Information System) of Wings needs to have an
upgraded version to ensure full control over current production, lead times and stock
balance. It needs to work on the IT security actively to prevent its impact on production
and deliveries. A frequent problem is the last minute changes incurred in the design –
which disturbs the production flow and planning. RFID and bar coding is still a
weakness for Wings in its product service offering.
Management cover, succession
Due to the relatively recent formation of Wings (2011), scopes for development of an
integrated management team is quite important. It is essential to develop Wings own
working management along with its introduction of the Indian business venture for
quicker policies and decisions, better knowledge of the trends and markets in close
collaboration with the Group‟s strategic framework.

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OPPORTUNITIES
Market developments
o From local to global – Increased importance of India as a purchasing/sourcing
market for the European Retailers and brand owners of the fashion & clothing
industry. Many European enterprises are also making an attempt to venture out into
the Indian market.
o Ever more importance of the brands – Increased requirement of customer-unique
solutions based on broad offering and value-enhanced profiling for differentiating
themselves to survive the fierce competition. To have a unified profile, identity and
image for long term success and development high level of service and branding is
instrumental.
o Growth of the Indian Retail Industry – With boom in the Indian retail sector and
potential international emergence of the bigger brands it is required to have idea of
the global market trends and requirements. Branding and profiling for these
companies would be a tremendous opportunity for Wings India.
Competitors' vulnerabilities
Adding value to brand – Wings is anticipated to stand at a competitive edge as
compared to the various small local and big international players in the market.
Compared to the small domestic players in the Indian market – the local apparel
producers – Wings is poised to emerge into a apparel provider with diverse product
portfolio, designing concepts and is not just a supplier of apparels. It also has a strong
offering of branding and design and greater international presence. It is very essential
for Wings Group to maintain the same vision for its business introduction in Mumbai. As
compared to the bigger competitors in the industry, Wings is more focused on growth
based on value addition with large range of products and services to offer to shirts
rather than large scale production of bulk products.

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Industry or lifestyle trends

Growth of Brand Profiling – Brand owners are increasing their investments in measures
intended to contribute to strengthening their brands. The branding industry both in
Europe and Asia are developing fast due to general economic development, changing
fashion trends and customer needs. This adds new dimensions of innovation and
prospect for Wings.
Global influences
Changing market – Growth in GDP and private consumption has resulted in long-term
influence on the general economic development. This has influenced both low-price and
premium brands on investing more and more resources in differentiating themselves.
The increased significance of the brands means that there has been positive
development for branding and design which contributes to strengthening profiling and
increased sale.
Niche target markets

(i) European Retailers and Brand owners expanding their purchasing/sourcing market in
Mumbai, tier1 city of India following New Delhi.
(ii) Indian Retailers and brands possibly making an attempt to make a venture into the
International market.
Business research and product development

Develop joint product development function with other acquired companies to
strengthen Wings India‟s position. Opportunities to have graphic designers and brand
consultants who are specialized in the development of graphic concepts for fashion and
fashion-related products for the Indian trends and consumer perspectives is essential.
New combinations of materials, technical development and designing closer to the
market are very essential to create exciting and innovative opportunities for brand
profiling. Research and development opportunities are also immense for expanding into
the variable data operations and RIS system.

26
Partnerships, agencies, distribution

Wings significant positioning into the Indian market with potential idea for strategic
introduction with the help of a strong alliance will ensure maintenance of top quality in
production, flexibility and customer adaptation as well as meeting requirements for
competitive prices. Opportunities for potential acquisitions and mergers are lucrative in
the Indian market perspective too. Integration backward along the supply chain with the
raw material suppliers is also a possible planning for reducing risks.
Seasonal, weather, fashion influences

The market for apparels moves with the developments in the fashion industry. Most of
Wings customers are in the fashion and ready-to-wear industry and demands a strong
identity and image of the garment to be successful in stores. It is when the customer
experiences a need for modernized or stronger profiling and wants to achieve a change
that Wings services are in demand. In the competitive market of today, brand profiling is
directly linked to the customer's choice of product and has a crucial bearing on how a
brand is perceived. In present-day society more and more trends are happening at the
same time. In addition, the life cycles of collections are becoming ever shorter as trends
change ever more quickly.
New ESP's
Wings can develop new propositions as its selling points by concentrating more in its
research and product development. Scopes are discusses in the Enhancement of the
product portfolio in Product Development & Differentiation Strategy further in the report.
Major contracts and alliances

New strategic alliances based on the requirement could be a major development based
on business expansion. Key collaborating partners can be either other Apparel
Producers, RIS/IT companies or suppliers. Further Integration Strategy has been
discussed further in the report…

27
New markets
New market developments – both International and domestic stands out to be a major
opportunity for Wings. The Apparel Fashion Industry in Mumbai is having a major
economic growth due to several reasons and this is favorable for developing the
business prospects for Wings.
THREATS
Political & Legislative Effects
Political risks or threats are industry-specific. Certain external developments may pose
to affect adversely the commercial viability of Wings future investments and business
plans. Some of them are as follows:
o Slow government decisions, adverse changes or unpredictability on foreign
investment, import, ownership, pricing or tax issues
o Cultural problems, delays or legal disputes
o Disruption of normal business due to social, political or labor unrest and industrial
action
o Corruption and bureaucratic inefficiency
o Unexpected delays and cost-overruns due to overlapping governmental jurisdiction
Environmental effects
Directly, Wings is not responsible for polluting the environment but it has to look after
and constantly monitor the effect of the players in its long supply chain contributing
towards causing harm to the environment. Wings India particularly has to introspect the
printing process in it‟s production base to ensure proper use of dyes and chemicals for
the printing purpose.
Competitor intentions
For comparatively newer business ventures and strategic introduction plans Wings is
anticipated to have diverse threats from the competitors. It is quite difficult for it to enter
into the Retail Sector by only providing the retail & brands with apparels. The
International competitors pose a threat in a sense that they have more EU retailers and

28
brands sourcing from India as their customers for their competitive price, large
production base and knowledge of the Indian market trends and perspectives. There
are threats from the raw material suppliers too for the increasing direct and indirect
material costs and also irregular and inappropriate logistics of material supply and its
quality. Forward integration of the suppliers into the supply chain to acquire apparel and
Apparel companies poses a major threat to Wings.
Market demand
Wings has to guarantee just-in-time delivery of products through efficient logistics and
distribution system, proper quality assurance, customer services and stock availability to
the customers whenever required to remain in the competition. This poses a threat to
Wings as it is still a small setup without its own manufacturing base and proper
knowledge of the India market trends, scenario and the quicker and short-lived changes
in the fashion industry.
New technologies, services, ideas
The continuous changing trends in the fashion world and hence in the requirement of
the clients has been a problem for Wings demanding constant R&D works for
developing branding solutions and also forecasting the latest trends.
Financial Risks
• Interest-rate risk – Interest-rate risk relates to the risk in the Group‟s exposure to the
changes in the market interest rate having a negative impact on the profit. During
centralized bank loans for investments prime the lending rate varies over the year
and this is a risk to the business transactions.
• Financing Risk – possible risk of financing the group‟s capital requirements and re-
financing of outstanding loans with the Wings principal bank.
• Credit risks – The risks of Wings „s customers not fulfilling their obligations, i.e.
Wings not receiving the payment of the trade receivables constitutes a customer
credit risk. Average credit term is nearly 120 days and sometimes there is potential
threat of not receiving the payments for the stocked products produced in
anticipation of the customer demand but not bought due to lack of a contract
agreement.

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7. COMPETTITVE DIMENSIONS
Five Force Model
Five Force Model for the Apparel Industry in India
Competitive dimensions
The present Project Work aimed to determine the market introduction prospects for
Wings Group through strategic development caters the need to have a comprehensive
industry definition to develop the competitive Five Force Model of the entire scenario.
Development of the Five Force Model provides a perspective of the key competitions
faced by Wings Group within the industry from the key players of today‟s market. The
development of the Five Force Model has been in consideration to the Indian
perspective with emphasis on the Apparel Sector considering all the Apparel Producers

30
– International and Domestic. Consideration of the branding concept and designing

attribute of this industry in developing the model is based on a unique selling proposition
(USP) only achieved by some of the companies much related to the emotional
experience of the consumers.
Competitive Rivalry within Industry

a. Number and size of firms
The Apparel industry has varied number of players with some major apparel producers
who have slowly emphasized and emerged as branding companies guaranteeing
complete design and branding services. They are well known due to their presence
across the world. Avery is the market leader due to its coverage of different
demographic areas and long list of product line for the customers. All of these
companies are providing their services all over the globe to customers. But there is
large number of smaller companies in the market too. The domestic companies with a
wide range of product portfolio and almost complete apparel can be considered as
potential threats because of their strong local knowledge and presence and hence
competitive pricing. They offer tough competition for companies like Wings and most
firms are operating at marginal profits.
b. Quality differences
Quality differences and product specification is a major concern in this industry. It is
evident that apparels being small are often the last thing to be remembered by the
garment manufacturers proving the end result often disappointing. This is a major
challenge for the apparel producers like Wings to meet and exceed their expectations in
terms of quality. Many manufacturers who start manufacturing overseas initially allow
the supplying factory to source their apparels locally which force the Apparel producers
to copy existing apparel rather than using original artwork – for being quick in delivery.
This often leads to incorrect design and color. Batch-wise and lot-wise inconsistency in
the product quality is also a major point of concern so unification of the product

31
according to the standardized quality is still a question. This is aggravated by the risks
associated with the raw materials unavailability or fluctuating cost which makes the
quality maintenance a tough task. A recent problem is the inconsistency in replication of
companies' brands and logos giving the consumer little confidence in the integrity of the
brand and garment due to the danger of data manipulation and incorrect coding. The
influx of Chinese apparel companies entering the market with questionable quality
products is also a recent problem. So it is quite important to establish a sales network
and meets ISO 9001:2000 international quality standards.
c. Switching cost
The negative costs that a consumer incurs as a result of changing suppliers, brands or
products is termed as switching cost. Although, most prevalent switching costs are
monetary in nature, there are also psychological, effort- and time-based switching costs.
For the Branding Industry this is a concurrent problem due to the expensive machinery
and infrastructure cost associated with apparel manufacturing which prevents the
apparel producers to change over from the existing method of production and
technology to newer innovations. Switching of suppliers has also been a risky business
in spite of threats of irregular material supply with inconsistency in product quality. This
restricts the apparel producers of comparatively smaller business volume to stay in the
market and compete with its existing portfolio.
d. Product/service ranges for overall market coverage or differentiation strategy
Wings on the other hand offers a comprehensive range of products that serves the
needs of the fashion industry– concentrating more on brand profiling and value addition
and not on bulk production of standardized products. The products of Wings i.e. Shirts
are innovative, quality oriented and up to date according to trends and fashion. They
offer woven apparels, textile apparels, embossed apparels, embroidered apparels,
metal etc., Retail Information Systems (RIS) and Radio Frequency Identification (RFID).
This ensures a total branding concept provided to the customers as a solution.

32
e. Differences between competitors

Even though the apparel industry is still small in its volume the numbers of players in
the Indian market are quite a few with different positioning in terms of their
turnover/volume, geographic coverage, expertise, product range, infrastructure etc.
Market leaders, emphasizes on bulk production in huge volumes with expertise in
almost entire range of product assortment with comparatively lesser value addition,
however, companies like Wings will focus on differentiation and value added branding
concept creating an extra pull for the customer. On the other hand the domestic apparel
producers are mostly smaller in infrastructure and lack the expertise to meet the quality
requirement of the international retailers. They also lack a proper know-how of the
global presence and are mostly local in their operation.
f. Economies of scale
Due to tough competition, large players aim at economies of scale through product
standardization. This is achieved by allowing product design, production and testing
over a much larger sales base. Scale economies are approached through
standardization of marketing, operation, and manufacturing of the products in bulk.
Companies aim to be market leader with economies of scale attained through bulk
production resulting in its tremendous volume of business. This has benefited such
companies through scaling down of costs and risks involved in the business.
Threat for New Entrants

a. Time and cost of entry
The apparel industry is a crowded market place with innumerous small, medium and
large players positioned in different segments – competing with each other. In such a
perspective - to establish a reputable setup being unique involves much investment,
R&D, innovation and understanding of consumer needs. For new entrants, the market
entry is not difficult but gaining a dependable position in terms of its unique marketing
mix is rather complex. Challenging factors for a new entrant includes infrastructural

33
development, machinery and skilled operator requirement, operational expertise,

continuous production management etc. Other specialized problems inherent to this
industry are like raw material risks, dependence on suppliers, fluctuations in customer
demands, logistics and distribution competencies etc.
b. Specialist knowledge
It is an important criterion for the new entrants to establish specific market knowledge
about the customers and market trends in India. Some large international apparel
producers like United Colors of Benetton and Ed Hardy before making a foray into the
Indian market have undergone sufficient market analysis and research for attaining
operating excellence in the market. This is a threat to the new entrant o a company like
Wings as this may reduce the market share index of the existing companies and tough
price competition too.
c. Cost advantages
Smaller companies, mostly the domestic apparel producers or the new market entrants
face the problem of low margins and large operational costs due to unattained of
economies of scale, higher degree of initial investments and also major competition
from the major players in the market. But with development they are able to render
much competitive pricing for the products due to their lesser infrastructural,
developmental and operational costs.
d. Technology protection
The technology in terms of manufacturing is easily available and skilled labor force can
be found in the market, though it is important to keep a check on the environmental
issues related to use of printing materials and dyes. Newer innovations like variable
data operations – RIS and RFID are complex in nature and the domestic apparel
manufacturers are not much competent in handling them.
Moreover, database management and ERP development is a chief requisite for
controlling the logistics, distribution and stock ensuring efficient delivery just-in-time.
e. Barriers to entry
There are no stringent barriers to entry in the market.

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Bargaining Power of Customers

a. Number and size of customers
The customers have strong bargaining power due to two reasons. Firstly, due to the
large number of apparel manufacturer in the Indian market – both International &
domestic which results in a competitive price ad term bargaining by the retailers, and
secondly due to the dependence of apparel manufacturers upon the customer for its
business. This is predominantly because the demand of apparels is a derived demand
and depends upon the growing demand of the apparel and clothing sold by the retailers
and the brands. Moreover, many apparel retailers and brands are developing their own
in-house appareling units to supplement their production units with faster delivery of
quality apparels, tags and branding concept and reduce the value chain complexity -
rather than depending on 3rd party.
Due to low margins because of low item price of apparels; apparel manufacturers
depend upon large order or long term relations with the retailers and brand owners. This
forces their dependence on the customers and development of a relationship through
written agreements or contracts.
b. Price sensitivity
The retailers and brands have an upper edge in bargaining the demand for the
Apparel& Design Industry (Tag & Apparel Industry). This dependency results in
developing a sensitivity to price variations. This lowers the inherent cost structure of the
products allowing greater demand through lower prices. With price increase, buyers
tend to move to other suppliers of apparels. So the price competition is always inherent
in this context.
c. Ability to substitute
Due to the large number of apparel producers in the market there is always a risk of
losing one‟s market position or some valuable customer to those players offering value
added services – though at a comparatively higher price. This is because of the
changing fashion and consumer needs the bigger retailers and brand owners are in a
constant spree to develop new. This is more fulfilled through innovative branding

35
concepts rendered by the companies like Wings. Thus general buyers can substitute
some types of apparels supplied from a apparel supplier depending upon market trends
and price variation keeping in mind the quality and delivery just-in-time.
d. Customer loyalty
Customers depend upon the apparels and brands to give a face to their products. Better
the concept or value addition through the rendered solution, better the quality and
logistics benefits and better the CSR and environmental & ethical issues of the apparel
producers - more would be the customer loyalty. This develops a long term relationship
between the apparel producer and retailer and they tend to stay with an apparel
manufacturer unless until there is some significant development.
Bargaining Power of Suppliers

a. Number and size of suppliers
Two different aspects have to be taken under consideration regarding the bargaining
power of the suppliers. This includes bargaining power of:
• Machinery and equipment suppliers
• Raw material (yarn, linen, dying inks and fabric etc.) suppliers from China, India,
Pakistan, Bangladesh, Vietnam, Indonesia and Morocco.
The raw material suppliers are innumerous though there are some specialized in
delivering products of particular high quality and specifications developing a
monopolistic business. Machinery suppliers are fewer with a proper transparency in the
business transaction. Moreover, machinery and equipment manufacturers hardly
emerge out into acquisitions of apparel companies to be potential threat to the existing
companies. However, many raw material suppliers are big enough to acquire the
Apparel & Companies. This forward integration in the supply chain renders a totality in
the business thus reducing complexity and number of players interacting in the value
chain. Moreover, the supplies of raw materials are more continuous – which seems to
an inherent problem for the Apparel Industry.

36
b. Building capability of suppliers

Type of machinery and equipment has significant influence upon the number of items
produced and quality of items produced by the buyer. This is how the business
proliferation of the apparel producer is dependent on the development of the machine
manufacturer. Moreover, the dependency of the apparel producers on the raw material
suppliers is quite evident.
c. Uniqueness of Service
The machinery suppliers are unique in their expertise rendering special devises
essential for apparel production like ultra-sonic cutting, laser cutting devices etc. Service
and maintenance related ability of machinery suppliers create importance and gives
them power. Moreover, the apparel producers are always in dependence of the big raw
material suppliers like Avery Dennison for their standardized quality, price and
availability.
d. Ability to substitute- It is difficult for the apparel manufacturers to substitute easily
their raw material suppliers because of the quality variation problem. The quality of the
raw materials are quite supplier specific and hence the apparel producers are
dependent on the suppliers.
Threat of Substitute Products

a. Alternatives Price
Technological innovation in apparels like RFID, intelligent or smart garments may
evolve resulting in a threat to the existence and market of traditional apparels and tags.
For the brand concepts and designs the innovation in the package could be more hi-
tech posing to be a potential substitute for the products.
b. Fashion and Trends
New fashion and trend may require new type or specific type of apparels and brands,
making the machinery and equipment for old type of brands obsolete like recycled
material tags etc. Innovation in the fast changing branding industry is always a major
threat.

37
8. RISK ANALYSIS FOR WINGS
Risk Analysis for Wings Mumbai
Factors affecting market penetration of Wings India‟s business proposition can be

characterized as external and internal factors. The external factors are those which are
factors external to the business while the internal factors include those which are risks
generated within the firms set-up or portfolio.
External Analysis
Country Factors
1. Political Stability Risk
The transfer of power between political parties at the central government level with
coalitions and differences generate a risk of political instability. This creates a stage of
fluctuating policies and decisions results in an unreliable political environment, in spite
of progressively increasing Indian economic growth. This could be a potential risk
considering Wings newer market ventures, introduction plans and investment.
2. Legal & Regulatory Risk

India's legal system is relatively impartial, free and fair but it is notoriously slow.
Disputes often take decades to resolve. The regulatory system is not immunized from
policy reversals due to pressure from vested interests and rivalries. The risk of outright
nationalization is very small, but creeping, suited to benefit the domestic companies,
and has caused companies to withdraw from the market.

38
3. Infrastructure Risk
India's infrastructure risk is high with over-stretched port facilities and run down of road
and rail links with slow rate of progress. The power system is also a significant
hindrance to business due to poor financial position of the electricity supply companies.
This has in turn affected electricity generation, so that power supplies are erratic and
companies, offices and some private houses use their own back-up generating facilities.
Despite India's successes in information technology, computer and internet access is
not widespread.
Industry or Operational Factors

1. Labor Market Risk
India's labor market is restricted by a number of laws and regulations, of which the most
important are those concerning the retrenchment of employees. Labor relations in India
are relatively poor with incidents of strike action in the private sector. This could be a
risk for Wings in attempts to start their service and distribution capacity by building more
setups and recruiting more personnel with inefficient control over the business.
2. Technology Factors
Due to the rapid change in technology related to product line and production facilities,
the first generation technology can become obsolete. This may result in sufficient
increase in cost structure requiring more research and development and considering
more switching costs.
Government/Economic Factors
1. Government Effectiveness Risk
Presently, government effectiveness risk is comparatively higher due to the divergent
interests of the members of India's coalition government. Certain governmental entities
could hinder the introduction of rapid market reforms in spite of increasing
professionalism in the Indian context. This to some extent may provide resistance to

39
privatization programs with degrees of red tape-ism resulting lack of foreign investment,
corruption and meager labor regulations. Wings India could face these inherent
problems in its stride for new developments in the market.
2. Macroeconomic Risk
The main macroeconomic imbalance is on the fiscal side factored by the high oil prices
which have led to widening of the trade balance.
3. Tax Policy Risk

Tax policy risk is moderate though there has been a reduction in the corporate and
customs tax. Still the tax system is complex, with numerous allowances in spite of
introduction of a nationwide value-added tax (VAT). India's tax system is susceptible to
tax evasion, and the underground economy is estimated to be quite large.
Consumer Factors
1. Changing Fashion and trends

New fashion and trend may require new type or specific type of apparels and brands,
making the machinery and equipment for old type of brands obsolete. Innovation in the
fast changing branding industry is always a major threat.
Competitive Risks
1. Overcrowding & Superior competitive entry

The most serious risk is that too many competitors are attracted by the growth situation
of the retail and apparel business in India which resulted in subsequent growth of the
Apparel business thus entering with unrealistic market share expectations. Another
reason for this has been because of the relatively lesser set-up and infrastructural cost
related to its development.

40
Internal Analysis
Technical & Quality Risks

Certain internal risks inevitable for Wings are like technical competence with the
changing trends requiring constant technical upgradation and purchase of latest
machinery and equipments for creating woven apparels and hangtags with regular
review of production schedule. Lack of an inspection plan, lack of exact performance
standards & qualification and documenting, approval and implementation of
performance standard are major issues substantiating the risk.
Logistics Risks
Logistic risks can be internal for Wings due to the inefficiency of its ERP database in
monitoring its sales, stock and distribution. This results in improper delivery to clients
with prolonged lead time. Joint ventures with sales and distribution company can on one
hand reduce the risk level and at the same time increase it as the external
transportation risks are now incorporated within the firm and needs additional
monitoring and management.
Legal & Legislation Risks

Joint Venture Risk
Partnering with another business can be complex in India. It takes time and effort to
build the right relationship. Problems are likely to arise if:
 The objectives of the venture are not 100 per cent clear and communicated to
everyone involved
 The partners have different objectives for the joint venture
 There is an imbalance in levels of expertise, investment or assets brought into the
venture by the different partners
 Different cultures and management styles result in poor integration and co-operation

41
 The partners don't provide sufficient leadership and support in the early stages this
is expected to be predominant in case of vertical integration with any raw material
supplier, IT provider or 3rd party sales and distribution partner as unification of
different business units along the supply chain becomes difficult.
Economic/Financial Risks
Financial concerns in a huge market like India are a major concern for Wings. It has to
constantly look after mobilizing its working capital to invest in innovations related to
product, technique or allied services like sales, warehousing and distribution.
Considering the high rate of inflation in India, economic risk is foremost if not controlled.
Security & Communication Risks

Wings Mumbaiya market perspective knowledge is limited, moreover nascent at this
point in time. It is essential for Wings to strengthen its function ability and develop key
prowess independently.

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9. BUSINESS STRATEGY DEVELOPMENT
“Most managers are near-sighted. Even though today‟s competitive landscape often
stretches to a global horizon, they see best what they know best: the customers
geographically closest to home”
– Kenichi Ohmae
Business Strategy Development

Development of business strategies for a company can be either global representing a
worldwide perspective of interrelationships between country markets drawn on to create
synergies, economies of scale, strategic flexibility, opportunities and production
economies; or multinational or multi-domestic, in which separate strategies are
developed for different countries and implemented autonomously.
It is quite evident that a global strategy can result in achieving sustainable competitive
advantage (SCA) considering several underlying motivations like obtaining scale of
economies, global brand association, global innovation, access to low-cost labor or
materials, access to national investment incentives, cross-subsidization, access to
strategically important markets and dodge trade barriers. However, the goal of
achieving significant global strategies is usually inhibited by local biases due to
decentralized structure, fluctuations in the local market related to market dynamics,
segmentation, customer motivation and culture.
In this perspective, Wings seeks to develop its business in line to the growth of Wings
worldwide with characterization of its business suiting the Mumbai perspective. Aim of
leadership for Wings must not force the company in developing a standardized business
strategy everywhere.

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Lack of proper local communication may lead to unbalanced economies of scale for
Wings which caters the need to develop a proper strategic alliance with another
company to develop the operations for Wings. Secondly, the lack of people, information,
creativity or the execution skills pertaining to the market perspective is very essential for
Wings. Thirdly, a standardization of processes and products nationally also may not be
feasible or optimal due to several reasons like different market share positions, different
images and different customer motivations.
Strategic cornerstones of Wings India

This phase of the report deals with the ultimate aim of this project work: feasibility
study of introducing the brand of Shirts by Wings in Mumbai. The analysis has
been directed only towards the strategic introduction of the company‟s multi-domestic
strategies considering the specialized Indian market perspective.
1. Ebony Retail Holdings Ltd., 2. Kewal Kiran Clothing Pvt. Ltd., 3. Century
Textiles & Industries, Ltd, 4. Personality Ltd. (Weekender), 5. Proline, 6. Lifestyle
International Pvt. Ltd., 7. Zodiac Clothing Co. Ltd., 8. Gini & Jony, 9. Globus
Stores, 10. Provogue India Ltd., 11. Aditya Birla Retail Limited - Madura Garments,
12. Pantaloon Retail (India) Ltd., 13. Koutons Retail India Ltd., 14. Raymond Ltd.,
15. Shoppers’ Stop, 16. Piramyd Retail Ltd., 17. Vishal Retail Ltd., 18. VF Arvind
Brands Ltd., 19. Wills Lifestyle Ltd., 20. Trent Ltd.

44
Exhibit 1: Turnover of major Indian Apparel/Clothing Retailers and Brand Owners for the
financial year 2009-10.
Exhibit 2: Number of exclusive Stores of the Indian Apparel/Clothing Retailers and

Brand Owners till 2009
Exhibit 3: Presence in number of geographic locations (cities) of the Indian

Apparel/Clothing Retailers and Brand Owners till 2009

45
Market Positioning Graph of Indian Retailers

The market positioning of the 20 leading Indian Apparel Retailers and brands have been
divided to avoid the making of the graphs cumbersome. The bubbles represent the
position of the retailers/brands located as (x, y) = (number of exclusive stores, number
of cities) with the diameter proportional to the turnover, drawn to scale. The scales for
the two graphs are different.
Market
Positioning
The first graph
shows the market
positioning for the
leading 10
companies, in
terms of turnover
(listed more than
INR 260 crore -
precisely INR 253.77 crore).
Market
Positioning
The second
graph represents
the market
positioning for
the rest 10
companies.

46
The essentialities of starting a strategic alliance for Wings is to leverage its business
components – distribution, brand name, sales organization, technology, R&D capability,
or manufacturing to generate economies of scale, gain access to strategic market,
overcome trade barriers, enhance product portfolio to serve market niche, gain access
to competitive technology, use excess capacity or low cost manufacturing capabilities
and/or reduce investments. Detailed perspective of the abovementioned considerations
are discussed more in Integration Strategy (further in the report).
To excel in the Indian market Wings needs the following:

a. Recruit its own key sales personnel to advertise and sell its branding concept and
solution to the potential Indian brands and also locate new International brands
having sourcing base in India and spread its value addition concept.
b. Training and operational excellence programs for its sales and marketing team and
also identify channels of marketing in India, e.g. through trades and exhibitions
c. Focus on country specific effective collaboration into the RIS business. To expand
the business maintenance it would be essential to recruit more ERP/SAP trained
personnel into the Wings India team
Price Comparison of Nilorn India and others with Interpretations

Before proposing a Pricing strategy to Wings, I made a price comparison study by
quoting price from nearly 50 Indian Apparel Producers/manufacturers – of different
company size and volume and also from Wings and its International Competitors
present in the Indian market.
It is anticipated that that price is comparatively higher in South India as compared to

that of West India and North India. Considering very few companies in the Eastern part
of the country, a correct price determination was not possible. However, price level of

47
Wings will be the comparatively lesser for the shirts and T-shirt category. This is really
an added advantage for Wings as despite having a vision of having competitive
advantage through value addition and not through pricing it will have a low product cost
range considerably. The price level of Wings is decided to be lower as compared to that
of the other international players.
Strategy Build up Proposals

I tried to structure a viable action plan with important contents for next three years
(2011-2014) for the strategic setting up of Wings Mumbai. It is important to develop a
vision for next three years highlighting some crucial aspects not only for a new market
but to construct company‟s strategic business plan. This plan might be difficult to work
with because many important aspects need to be organized and introspected according
to the changing business/market situations and requirements.
Pricing Strategy
According to the Price Comparison Study and the Price Strategy Matrix as shown in the
exhibit 4, Wings India is evidently positioned in the Penetration Pricing zone. However,
building up its competitive edge considerably, it can attempt to move into the premium
pricing zone of offering comparatively higher price for its value added branding and
designing concepts, solutions and products. This is quite essential to build up profit
margin.

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Exhibit 4: Price Strategy Matrix

Some of the key factors essential to be considered for strategic pricing are as
follows:
a. Premium Pricing - Wings must try to increase to product portfolio and through
innovation and brand developments ensure offering of value added apparels.
Through proper marketing techniques and confidence of customers, Wings can shift
to the premium product pricing band to ensure more profitability.
b. Price Discrimination - Wings must offer the same competency and product at a
lower price, initially, to capture the new market – for new customers. At least it can
offer lower pricing for solutions it aims to provide to its potential new Indian
customers aiming lesser profit margin – essential for market penetration.
c. Price Cutting - Wings must focus on development of solutions that require less
engineering costs and more efficiency, while at the same time lower in cost of
operation to ensure product improvements.
d. Aggressive Pricing - Introduce new initiatives in advanced manufacturing
techniques and commercialization. It is a requisite to evaluate varying degrees of
aggressive price adjustment mechanisms to exploit market niches based on recent
success in winning contracts.

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Product Development & Differentiation Strategy
1. Matching Wings product line along with fashion trends

Wings needs to keep itself constantly updated to the new trends and concept of the next
launch of product line in order to provide competitive apparel and product development
to target customers as discussed previously in the report. It would be beneficial to
maintain a local design team or branding consultants with Indian market and trend
knowledge into its core product development team. Strategies in India can be innovated
by using European collaboration to launch products either with existing version or
modifications to attract further customers.
2. Enhancement of the product portfolio
Wings needs to constantly strive for market survey and research – identifying the
requirements in branding concept and apparels and hence develop them in response
through innovations.
Redefining/redesigning product portfolio and classified factors (market segments,
customer profiles, motivations and unmet needs) according to targeted markets.
Others
Wings can strive to make and its products visible to the outer markets, this can be done
by going to exhibitions, especially required in the Indian market perspective eyeing an
introduction.
Maintain high level of customer service to run the systems at an optimal level while
applying metrology (minimizes faulty output/products). Improve and expand on the
consulting/advisory services offered to customers.

50
Market Innovation Strategy – R&D

Wings main aim is to provide high quality apparels to the fashion industry. Campaign for
customers through rebates as well as outlining tax breaks and subsidies at state or local
level (grants for researches) in bigger projects through partner organization. This can
aid in developing country specific branding concepts.
Market concentration vs. R&D investment

It is very crucial for Wings, to determine the perfect combination for its introduction
strategy based on efforts made through market concentration using the existing product
portfolio and technology and the development of new assortment through innovation.
This can be analyzed as following the existing course of strategy for the existing market
and attracting newer customers by proving its edge partly through innovations. As
discussed in the SWOT Analysis of Wings, R&D works needs to be concentrated on
considerably.
Integration Strategy
Depending on risk willingness and the strength of a brand, a joint venture with a
professional and committed local partner is sometimes the most appropriate way for a
company to enter a new geographical market. The Integration Strategy for Wings at the
current position can be either horizontal integration or vertical integration. Horizontal
integration for the company emphasizes the need to balance the strategic value of the
collaborator when the firm in the same industry and stage of production; is being taken-
over or merged with another firm which is in the same industry and stage of production
as of with the merged firm.
Vertical integration - is the degree to which a firm owns its upstream suppliers and its
downstream buyers. Contrary to horizontal integration, which is a consolidation of many
firms that handle the same part of the production process, vertical integration is typified
by one firm engaged in different aspects of production (e.g. growing raw materials,
manufacturing, transporting, marketing, and/or retailing).

51
Horizontal Integration- Wings India must strengthen its strategic alliance by balancing
relative contribution in developing competency. This needs to ensure the recognition of
company‟s contribution to set realistic expectations and allow success to be measured.
This ensures the following steps:
• Communication – It is usually a good idea to arrange regular, face-to-face
meetings for all the key people involved to discuss on the tangible benefits of a
JV, like higher productivity and reduced recruitment costs etc., financial matters
to ensure transparency and trust.
• Establishment of clear performance indicators for the business joint venture of
Wings in Mumbai is essential to measure performance. These performance
indicators for the JV can be classified as Productivity & Production Parameters,
Price, Quality, Stock, Delivery time, Financial Position and Business Ethics &
sustainability (from Wings India‟s business point of view).
• Flexible relationship - Regular review or monitoring of improvement methods is
quite essential to deliver "win-win" solutions. The original joint venture agreement
should set out agreed dispute resolution procedures in case of inability to resolve
the differences.
• Develop Distributors and Sales network with a vision for next three years. Also
build ideas bank inside company covering different aspects in the market and
analyze them for further evaluation. Use strategic interaction to create and utilize
synergies among the subunits of the company in different markets to create one
company.
Human Resource Department of both the companies have come together to form a
team for the merger which consists of legal experts in order to work out all the legal
aspects and draw up all papers with the agreed terms

52
CSR, Environmental, Legal Strategies

It is quite essential to develop a proper environmental & CSR strategy for the
functioning of Wings in Mumbai.
• Emissions from printing operations contain small amounts of volatile organic
compounds, which can be regulated by agencies of federal, state, local and
foreign governments. It is essential to evaluate the use of alternative materials
and technologies to minimize these emissions. In connection with the
maintenance and acquisition of certain manufacturing equipment it is essential to
invest in printing units and equipments to assist in regulating these emissions.
• It is also required to develop newer processing systems like adhesives and
adhesive processing systems that minimize the use of solvents.
• Potential responsibility for cleanup costs at certain hazardous waste sites must
be abided by "Legal Proceedings" and "Management's Discussion and Analysis
of Results of Operations and Financial Condition".
Based on current information, we do not believe that the costs of complying with
applicable laws regulating the discharge of materials into the environment, or otherwise
relating to the protection of the environment, will have a material effect upon our capital
expenditures, consolidated financial position or results of operations.
Market Profitability Analysis – Five Force Model

Barriers to entry
• Number and size of firms
• Quality differences
• Switching cost
• Product/service ranges for overall market coverage
• Differences between competitors
• Economies of scale
Potential entrants
• Time and cost of entry
• Specialist knowledge
• Cost advantages
• Technology protection

53
Threats of substitutes
• Alternative‟s Price
• Changing Fashion and Trends
• Legislative Effects Bargaining power of suppliers
• Number and size of suppliers
• Building capability of suppliers
• Uniqueness of Service
• Ability to substitute
Bargaining power of customers

• Number and size of customers
• Size of batch order
• Price sensitivity
• Ability to substitute
• Customer loyalty
Key Success Factors

Present
• Product Quality,
• Introduction of new products,
• Breadth of product line,
• Brand recognition,
• Cost Reduction,
• Just-in time logistics and efficient distribution system
• RIS and variable data operations
Future
• Capturing the trends of the consumers,
• Quality,
• Relationship in the Supply Chain,
• Branding,
• RIS and RFID,
• Environmental and CSR concerns

54
Environmental Analysis
A. Trends and Potential Events
B. Key Strategic Uncertainties
1. Possibilities of new strategic alliances and mergers, with production units, raw
material suppliers
2. Acceptance of brand profiling solution in the new market
3. Product innovation and portfolio diversification
4. RIS and variable data operation
Internal Analysis
A. Performance Analysis
B. Summary of Past Strategy
Strategic fit into the Indian business perspective includes the following considerations:
1. Strengthen market branding
2. Increase coverage of service and production network
3. Focus on existing markets

55
10. CONCLUSION
The approach of the present project report was to help Wings start their business,
further, into the potential Indian market and to work out business strategies that could
position Wings for possible market expansion in the national perspective.
The initial phase of the report reveals the current situation of the Indian market for
possibilities of growing the established business of Wings in India and also deciphers
new opportunities for market introduction. It is seen that the Indian market is quite stable
regarding the political environment, technological upgradation and the current growth
rate and economic development has resulted in a boom all around the industry,
particularly in the retail and apparel segment.
In such a scenario, the growth of the branding and designing companies is inevitable.
So the prospect for Wings to start its business in Mumbai is immense, especially in
consideration to its present positioning of subsidiary based production system and own
services. However, certain factors like current rate of inflation, large number of
competitors etc. are threats but not major.
The surveys and the strategies proposed in the report for business development of
Wings is a clear indication of the driving path for the company.
According to me the implementation of certain strategies proposed herewith, based on

its viability in the changing market situation would be appropriate.
Implementation caters the need to have strategic reviews of "Vision 2014" and
milestones after one year in order to improve the performance and profitability and
make proper adjustments of the targets that have not been met.

56
It is also a requisite to monitor competitors closely and benchmark with them to

constantly adopt the "best practices" in achieving operational excellence through
introduction and implementation of Operational Excellence Programs.
Continuous motivation to explore new market and claim an early market share in
potential market is also a requirement along with the setting up of measurable
milestones to be achieved throughout the next three years to achieve overall (and
annual) sales target in Wings.
There were certain things that were not possible to be represented in the report due to
information constraints; like; finding out the exact market shares of the International
competitors of Wings in the Indian market and also that of the domestic apparel
producers and also tuning the list of EU retailers and brand owners those sourcing from
India; which could be appreciated. This can be a potential future extension of the
present work.
But I believe that by implementation of the presented strategies and consideration of the
key factors given in this project, Wings will be able to achieve their aspired vision
exacting perfectly in the national perspective also.

57
11. Annexure
Raymond Ltd.
http://www.raymondindia.com/
Turnover: USD 500 million /INR1284.19 crores
No of Stores:
Raymond Shop - 361 stores in prime locations in 150 cities in India, 29 stores in 15 cities across
the
Middle East – Bahrain, Kuwait, Qatar, Saudi Arabia, Oman UAE; Sri Lanka, Bangladesh and
Nepal
(The Raymond Shop retail chain occupies a space of 1 million square feet built-up area)
ZAPP – 3 exclusive brand stores
Notting Hill - Pune and other cities in Maharashtra (400 distribution points)
Parx - company owned Exclusive Parx brand stores, The Raymond Shop, large format stores
like Piramyd, Central; and other leading menswear stores
ColorPlus - 180 locations in the South and West Asia through exclusive stores, 'The Raymond
Shop' outlets
Park Avenue - Park Avenue stores and 'The Raymond Shop' chain of stores where they are
selling: 55 countries including the European Union, USA, Canada, Japan and Australia
Brands & Items: Raymond, Raymond Finely Crafted Garments, Notting Hill, Manzoni, Park
Avenue, ColorPlus and Parx
Raymond - worsted suiting fabrics
Manzoni - Manzoni formal Wear, Manzoni Sports Wear, Manzoni Accessories
ZAPP - party wear to casual wear (Basics', 'Denim' and 'Street wear')

58
Notting Hill - men's lifestyle products comprising of suits, shirts, trousers, jeans,
tshirts and also accessories like ties, handkerchiefs and socks
Parx - causal wear segment (Urban, Sport, Excursion and Club)

ColorPlus - casual wear brand (smart casual clothing'), 'ColorPlus Woman' (Day
Wear, Sporty Casual Wear, Outdoor Wear, Business Casual Wear and the Evening Wear)
Park Avenue - Well-dressed gentlemen (shirts, trousers, suits and jackets)

Park Avenue Woman (Business Wear for women - 'Modern Classic' range for Business Formal
Wear,
'Urban Chic' range for Business Leisure Wear and 'Opium Delight' for Business Evening Wear)
Price Level
• ZAPP (ASP INR 600),
• Notting Hill (Shirts – INR 800-1500, Trousers INR 1000-1800)
• Parx (Shirts INR 1000-1699, Jeans INR 1200-2200, Trousers INR 1100-1800)
• Color Plus (Shirts – INR 1300-2700)
• Park Avenue (Shirts – INR 1099-2599)
Target Group
 Raymond: For caring, sensitive men who places a huge premium on relationships
 Manzoni: for Indian customers who buys his brands from abroad
 ZAPP : Fashion conscious young adults between the age group of 4-12 years
 Notting Hill: young working professionals
 Parx: ("beyond work") for energetic 22-30 year old who is aggressive, outgoing, dynamic
and lives his life to the fullest and looks at clothing as a reflection of their attitude and
vibrancy
 Color Plus: independent, discerning and multi faceted people of today
 Park Avenue: for men requiring formal clothing be it for a day at office, high-powered
corporate meetings, family get-togethers or festive occasions

59
12. SYNOPSIS
Introduction to the Area of Research
A feasibility study looks at the viability of an idea with an emphasis on identifying

potential problems and attempts to answer one main question: Will the idea work and
should you proceed with it?
Research Objective
The clear cut objective behind this research is to do an empirical study on Apparel
industry in India especially Mumbai and then conduct a feasibility study to check the
viability of launching a new brand of shirts. This study would help me decide whether I
should launch my brand or not by understanding and studying the competitors in this
very desired industry.
Research Methodology
This research would mostly be a qualitative research and very less of quantitative
research as my aim is to understand my competitors strategy and to do thorough
analysis to find my competitive advantage among these hardcore global and domestic
competitors.
Justification for choosing a particular research proposal
The Indian apparel industry, which took off in the mid 60s, is worth around $18 billion
now. The growth over the years has been significant, and technology does have a role
to play in that. In fact, the industry has evolved gradually in terms of technology
adoption and has reached a critical mass today.
To give the buyers the freedom of choice, the Apparel and Fashion industry of Mumbai
operates through an attractive chain of retails stores, shopping malls, superstores and
multiplexes. From the funky style accessories to branded eastern and western wear, the
shopping centers of Mumbai are known to have an innumerable array of fashion
products.

60
The prompt following up of the newest trend in the Fashion world and a very affordable
price tag are the two prime factors that go a long way in making Mumbai the abode of
style apparels. The city is popular for both expensive multi-storied complexes as well as
cheap road-side shopping corners.
As the global companies vie to have a place in the heart of Mumbai, the city continues
to celebrate the carnival of Fashion through its enticing string of Apparels and Fashion
stores. Since, Mumbai can be said to be the Fashion Capital of India, I would like to
conduct a feasibility study for launching my brand of shirts with special emphasis on
Mumbai region.

61
13. BIBLIOGRAPHY
WEBSITES:
http://www.indiastrategy.com/polrisk.htm
http://digimarc.indianyellowpages.com/brand-profiling.htm
http://www.investopedia.com/terms/s/switchingcosts.asp
http://www.domain-b.com/companies/companies_r/raymond_ltd/20050218_expansion.html
http://www.atamapparel.com/quality.htm
http://www.researchandmarkets.com/reportinfo.asp?report_id=358514
http://www.expresstextile.com/20051115/regulars01.shtml
http://en.wikipedia.org/wiki/Horizontal_integration
http://en.wikipedia.org/wiki/Vertical_integration
http://www.riskcenter.com/story.php?id=11380
http://www.riskcenter.com/story.php?id=13697
http://marketingteacher.com/Lessons/lesson_pricing.htm
http://www.economywatch.com/indianeconomy/indian-economy-overview.html
http://d.scribd.com/docs/2e72qm5ixchs045pf2z.pdf
http://www.atamapparel.com/quality.htm
http://csdl2.computer.org/persagen/DLAbsToc.jsp?
http://www.aepcindia.com/countryreport/country_report.asp
http://www.raymondindia.com/
http://www.pantaloon.com/index.asp
http://www.shoppersstop.com/index.jsp.vr
http://www.vishalmegamart.net/
http://www.willslifestyle.com
http://www.vfc.com

62
http://www.koutons.in/
http://www.mywestside.com/index.asp
http://www.maduragarments.com/
http://www.provogue.net/
http://www.lifestylestores.com
http://www.zodiaconline.com/

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Logesh Joshi – MMS 2009 – 2011/23

 To study apparel industry in Mumbai for launching new brand of shirts.

Logesh Joshi – MMS 2009 – 2011/23

3. INTRODUCTION OF INDIAN APPAREL INDUSTRY

Logesh Joshi – MMS 2009 – 2011/23

Logesh Joshi – MMS 2009 – 2011/23

This project is the mixture of theoretical as well as practical knowledge. The

Logesh Joshi – MMS 2009 – 2011/23

5. MARKET SURVEY & EXTERNAL ANALYSIS

PEST Analysis of Indian Market for the Apparel Industry

Logesh Joshi – MMS 2009 – 2011/23

• liberalizing procedures for industrial licensing and investment

Logesh Joshi – MMS 2009 – 2011/23

Logesh Joshi – MMS 2009 – 2011/23

Review on Business Setups in India

Business Setup Format

Logesh Joshi – MMS 2009 – 2011/23

Logesh Joshi – MMS 2009 – 2011/23

Formation & Management of Company

Fringe Benefit Tax

Bank Account Operations & Loan Syndication

Logesh Joshi – MMS 2009 – 2011/23

Special Economic Zones (SEZ)

Logesh Joshi – MMS 2009 – 2011/23

Logesh Joshi – MMS 2009 – 2011/23

6. BUSINESS OVERVIEW OF WINGS

What is driving Wings?

Wings is anticipated to be a tertiary player in the fashion supply chain relationship

How accessible can Wings be in the mainstream?

Logesh Joshi – MMS 2009 – 2011/23

Is Wings broadly based?

Vision and Wanted Position

• The customer offer is superior to that of the major players in terms of

Logesh Joshi – MMS 2009 – 2011/23

- Production network offering closeness to the customers´ own production sites

It is essential to exploit this market position by duplicating it on other markets, by

Logesh Joshi – MMS 2009 – 2011/23

Current Positioning of Wings India

Production, Marketing & Services

Logistics, Stock & Distribution

Logesh Joshi – MMS 2009 – 2011/23

Wanted position – Wings

Logesh Joshi – MMS 2009 – 2011/23

Logesh Joshi – MMS 2009 – 2011/23

SWOT Wings– Analysis

Resources, Assets, People

Logesh Joshi – MMS 2009 – 2011/23

Location and geographical

Processes, systems, IT, communications

Logesh Joshi – MMS 2009 – 2011/23

Logesh Joshi – MMS 2009 – 2011/23

Logesh Joshi – MMS 2009 – 2011/23

Logesh Joshi – MMS 2009 – 2011/23

Industry or lifestyle trends

Niche target markets

Business research and product development

Logesh Joshi – MMS 2009 – 2011/23

Partnerships, agencies, distribution

Seasonal, weather, fashion influences

Major contracts and alliances

Logesh Joshi – MMS 2009 – 2011/23