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Fabindia (Medha Rohit)
Fabindia (Medha Rohit)
LTD
By,
Medha Saha
Rohit Kumar Shaw
Fabindia An Overview
Established in 1960 by John Bissell
Indian chain store retailing garments, furnishings, fabrics and ethnic
products handmade by craftspeople across rural India
Started as an exporting home furnishings company
In 1976, opened its first retail store in Greater Kailash, New Delhi
No. of Stores Over 170 across India and abroad
Organized retail Only 3% of the total retail market in India (USD 230 billion).
Expected CAGR 18%
Also the disposable income with the middle class is ever increasing.
Therefore, there is a huge growth potential awaiting to be tapped in the retail sector.
Hence, customer retention cannot be the only way, customer acquisition will be an
important strategy going forward.
How?
Organic foods
Need to capitalize significantly
Products appreciated by customers
FabIndia already has the rural network, goodwill and reach to source these products.
Change in the organization structure:Dedicated brand management and marketing department needs to be created
Use external market research agencies, tie-ups with rural training institutes and colleges
IT and software to be strengthened to enhance online presence
More decentralized management structure is required, with more powers vested in the
regional heads to manage the expansion
Advertising
Effects of Growth
I. Increase in profitability
II. Importance of excessive professionalism over trust while dealing with rural suppliers
III. Challenges faced in preserving the ethos of the company in line with its social mission.
So the growth has to be balanced, keeping in mind the larger ideology of FabIndia of
providing sustainable employment to craftsmen.
The positive aspect of growth will be the revenue generated which needs to properly
channelized into investments where the organization can not only flourish its
expansions but also diversify further.
Priorities
Ironing out the supply chain issues Supply side irregularities can be resolved by
greater co-ordination and decentralization of processes
Recruitment of manpower Especially in the middle management and staff positions
Building the brand image aggressively, with focus on its social mission and diverse
product mix, showcasing growth potential to prospective investors before going for an
IPO or Private Investments.
Expansion plans for the organic foods sector as it has deep roots and pan India
presence in the rural sector.
Blueprint for entering tier 2 and 3 cities more aggressively, especially starting with the
furniture division. Tie ups with real estate chains including apartments and natural
resorts/hotels can provide the starting direction.
(Fig 1)
(Fig 2)
Social upliftment
Livelihood generation
Training and skill development
Women empowerment
(Fig 3)
Bibliography
Fig 1 - GEMI Metrics Navigator
(http://www.gemi.org/metricsnavigator/eag/Are%20Social%20Goals%20Relevant%20to
%20Business.pdf)
Fig 2 & 3 - tejas@iimb
(http://tejas.iimb.ac.in/articles/Tejas_September%20Edition_Article%202.pdf)
THANK YOU