Fab India Case Writeup Essay

5577 words - 23 pages

FABINDIA CASE WRITE UP

John Bissell, the founder of Fabindia was a Connecticut native who went to India in 1958 on a Ford Foundation- Sponsored Program to advise the government- run central cottage industries corporation (CCIC). He saw an entrepreneurial opportunities to bridge the gap between the weavers' talent & skills and market knowledge or ability to access consumers. He also liked India and wanted to help the rural poor there. When asked why he kept coming back to India, he had remarked," there is heart in India."

Fab India was founded in 1960 with a mission to provide work and employment to�India's skilled rural artisans and to protect ...view middle of the document...

Rapid scale-up would require more�qualified personnel�and formalization in organization. Absence of organized retail sector in�India�has lead to shortage of qualified personnel.

New retail chains�like Pantaloon, Trend Ltd, Shoppers World, ITC have entered in garments sector posing potential threat to Fabindia. 70% of Fabindia's revenue are generated from garments. Small players like, privately owned Anokhi, Govt. owned Khadi, State Govt owned Phullkari, Rajasthali, Chunari etc have also expanded and opened their shops in major cities of�India.

New product lines�were introduced and have shown positive results. In last two years organics and body care revenue has seen a growth of 100 times.

Increasing number of shops will require more investments due to�increasing rental�and property rates. Another major challenge for Fabindia could be capital for expansion. For desired exponential growth Fabindia may require�additional external capital.

Supply chain�of Fabindia is based on trust with uncertainty of supplies from its rural suppliers. Estimate of supply has always problem for Fabindia.

FACTS AND FIGURES

FabIndia

Indian Economy

1960- Incorporation�in Delhi

1976- First retail store in GK

1977- Contemporaries design

1981- Introduction of garments

1992- Liaison�with Habitat ends

1994- Second store opens in Delhi

1999- William Bissell becomes MD

2003- Vision�Plan I�originates

2004- Goes online

2005- Vision Plan II�is born

2006- Garments make 70% revenue

Post 1947- Gov. supports socialism & nationalism

1957- Gov. sets up KVIC

1990- Fiscal deficit reaches 8.5%

1991- Indian economy�opens up

2006- 8% economic growth

2006- Gov. allows foreign single�brand outlets

FABINDIA UNDER JOHN BISSELL

Founded By: John Bissell to develop market for hand-woven products, Provide rural employment,

Incorporated in 1960 in�Delhi to�export upholstery fabric By 1965, revenues of Rs.�2 million due to: A S Khera, supplier of hand-woven rugs etc from Panipat

Habitat,�major�UK buyer of�Fabindia Panipat products

1974 - Fabindia's first retail store�in Greater Kailash with ad-hoc merchandising

1977-Featured contemporary design to attract consumers and designers

Garments were introduced in 1980s after John Bissell�got khadi shirts made for himself�

Habitat was acquired in 1992 and Fabindia could no longer continue selling to it

John Bissell dies in 1998, passing the�baton to son William Bissell who becomes MD in 1999

FABINDIA UNDER WILLIAM BISSELL

End of license raj, and�liberalization gave textiles duty concessions on machine imports

William's vision included expansion, depending less�on exports and setting up�retail operations

India saw robust economic growth, change in consumer patterns and growth of middle class by 2006

2003 - the birth of Vision Plan I

Planned to grow to�revenues of Rs.�1 b�from Rs. 360 m�in...

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