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2012

National Institute OF Fashion Technology, Bengaluru Project by: Anaushka Sharma Apurv Sinha Atul Prakash Verma Zia Quamar Tushar Khurana BFT-V

[E-COMMERCE] ‘Becasual.com’ apparel e-Business Concept

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Contents

Sr No. Detail Page No

1. Introduction 3

Literature Survey 4-7

2. Company Profile a. Introduction 8

b. Market Analysis 8-15 i. Clientele

ii. Place

iii. Price iv. Product & Services

v. Promotion

3. Business Model i. Business Flow Process 16

ii. Back End Flow Process 17

iii. Research and development 18 iv. Storage 18

v. Logistics 19

vi. Packaging 19 4. Conclusion 20

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INTRODUCTION

Terms such as e-commerce or internet commerce have been

developed to describe the process in which electronic transactions facilitate the exchange of, and payment for, goods and services

between businesses, consumers, government and other public and

private organisations using the internet, computer networks and portable electronic devices.

The OECD definition of e-commerce further specifies that it

relates to the ordering of goods and services over the internet, but the payment and ultimate delivery of the good or service can be

conducted on or offline (ACMA 2010a).

Online retailing is a subset of e-commerce and refers to the purchase and sale of goods between consumers and retailers using the internet

— also referred to as the business to consumer (or B2C) market.

Other terms are interchanged for online retailing including e-tailing. Online retailing establishments can take the form of ‘pure plays’ in

which businesses provide online only services in particular retail

categories or as part of multi-channel establishments where online activities are combined with bricks and mortar operations.

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LITREATURE SURVEY

Online apparel retail scenario around the globe:

CHINA

According to iResearch estimates, the number of online shoppers rose from 108 million in end-2009 to 148 million in end-2010, accounting

for 32.4% of China’s Internet population.

According to the iResearch as shown in Exhibit 10, apparel was the most popular categories sold online in 2010.

NEW YORK, NY

Online sales of apparel and accessories are now growing faster than

any other ecommerce product segment, and the category is poised to

help US retail ecommerce sales grow 15.4% to $224.2 billion in 2012, after stronger-than-expected sales took the market to $194.3 billion

last year, according to a new report by eMarketer.1

AUSTRALIA

Australia has huge market for online apparel retail.2

1 http://www.emarketer.com/newsroom/index.php/apparel-drives-retail-ecommerce-sales-

growth/#hoJrmcuc0a6Q0V5u.99

2 http://www.pc.gov.au/__data/assets/pdf_file/0009/113769/07-retail-industry-chapter4.pdf

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SALES COMPARISON OF E-COMMERCE vs. PHYSICAL

STORE3

3 http://www.buysight.com/blog/2010/02/27/what-are-people-really-buying-online/

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APPAREL E-TAILING MARKET IN INDIA

Increase in sales:

The e-commerce business has brought a revolution in the shopping

model of India. While the online apparel category continues to top the

list of high performers in e-commerce, a study by Technopak

Advisors, a consulting firm, reveals this segment will now grow

almost ten-fold to nearly Rs 7,000 crores by 2015 pushed by Gen Z

who already number 7.4 million. Gen Z interestingly known as the

Net Generation has been held responsible for the increase in sales of

garments on the internet and making e-tailing a favorite spot for

private equity investments.

In the last two years, the Rs 650 crores garment e-retailing business

on the internet has attracted investments worth $70 million i.e. 40 per

cent of the total funding Indian e-retailers bagged during the period.4

Indian apparel Industry grew by 10.4% in 2011 to reach Rs 419bn. It

is expected to reach a value of Rs 580bn in 2016, increase of 38.4%

since 20115.

4 http://www.fashionunited.in/news/fashion/e-commerce-boosting-apparel-sales-240820112415 5 http://www.mbaskool.com/business-articles/marketing/5243-apparel-retail-industry-going-online.html

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Foreign investements

The recent inflow of private equity investment firms into many

garment start-ups is an indication that the apparel e-tailing platform is

reaching a tipping point fast. For instance investment giants like Tiger

Capital, IndoUS Venture Partners, Helion Venture Partners, Sequoia

Capital and Accel India have invested in the range of $5 million to

$52 million in portals like Letsbuy, Flipkart, FashionAndYou, Yebhi,

and Snapdeal. 6

6 http://www.fashionunited.in/news/fashion/e-commerce-boosting-apparel-sales-240820112415 (Wednesday, 24 August 2011)

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Retail Clothing Business Plan

1.1 COMPANY

BECASUAL is a start-up retail establishment that will sell

fashionable and casual clothing to men and women of the age group

16-30 years at affordable prices and latest and fashionable prices. BECASUAL will be located in Bangalore, which is the IT hub of

India. Expansion plans include reaching to 2 and 3rd

tier cities with a

widened product range. In turn, we would hope to penetrate a sizable portion of the online apparel retail market.

2 MARKET ANALYSIS

In the last two years in India, the Rs 650 crores garment e-retailing

business has been done on the internet showing a great potential to

enter the market.

2.1 CLIENTELLE RESEARCH:-

Market:

Men’s share is approximated to decrease to 37% [2015] from

43% [2009], while women’s share to increase to 43% [2015] from 38% [2009].

7

India has a large and aspirational middle-class of 75 million households or 300 million individuals

India also has 500 million Indians under the age of 25. Young

Indians have access to more money than before and with this has come independence, aspirations and a demand for products.

7 http://www.mbaskool.com/business-articles/marketing/5243-apparel-retail-industry-going-online.html

(june 2010)

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BECASUAL Clientelle:

Age group- 16-30 years.

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Men and women’s wear

Middle class Indian population.

2.2 PLACE:

Market analysis

Major markets for e-tailing of apparel:

Among big cities, consumers in Mumbai topped the chart in doing

online shopping followed by Ahmedabad and Delhi.

However, shopping on the net is gaining traction with consumers

beyond metros and Tier I cities as well.8

BECASUAL target market:

Metros and major tier-1 cities.

2.3 PRICE:

Market analysis9

The margin between manufacturing and sales to retailers is 50-70%, while margin between retailers and point-of-

sale to customer is 30-40%.

8 http://www.fashionunited.in/news/fashion/e-commerce-boosting-apparel-sales-240820112415 (Wednesday, 24 August 2011) 9 http://www.mbaskool.com/business-articles/marketing/5243-apparel-retail-industry-going-online.html (2011)

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10

BECASUAL target retail price:

Multiplication factor- 3 on cost of garments.

Flash sales- Multiplication factor- 1.8 on cost of garments.

Discounts- multiplication factor- 2.5 on cost of garments.

10 http://www.ibef.org/india/economy/

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PRODUCT

MARKET ANALYSIS:

market share of casual wear is on high demand, as the current generation prefers comfort and quality in an

manner

The Clothing Manufacturers Association of India “Dress up

Sportingly”, Feb201111

It is found that rural consumers are also shifting from dhoti to more

western garments like trousers and jeans.

Indian consumers are often referred to as value-conscious. This does not necessarily imply that consumers ‘want a steal.’ Instead, they

want a well-made product that is priced fairly, and that meets its

stated promises.12

11 http://www.mbaskool.com/business-articles/marketing/5243-apparel-retail-industry-going-online.html 12

https://www.pwc.in/assets/pdfs/rc-publications/WinningSector.pdf

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BECASUAL PRODUCTS:

We will be specialising in casual wears starting with casual bottoms

and tees for men and women and accessories.

PRODUCT U.S.P-

Comfortability engrafted in most fashionable designs delievered at affordable prices.

Detailed product range:

Apparel Accessories Limited Editions

Trousers Caps Bollywood

Tees and tops Handkerchiefs

Polo-tees Sunglasses Cricket lovers

Shorts Belts Festive casuals

Cargos and capris Wallets

Casual shirts Funky jewellery sets

General specifications of available products:

Colors Both bright and dull.

variety of colors.

Silhouettes comfortable and appealing

Embellishments none

Trims Funky and casual styles,no

intricate detailing.

Fabrics Cotton,denims and other easy to wear and care fabrics.

Wrinkle –free cotton mix fabrics

no flimsy and delicate fabrics

Sizing Exclusive sizing charts available

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SERVICES:-

o DELIEVERY- within 5-7 working days and location dependent

o Return policy- within 15 days from date of delievery in fresh condition

o Packaging- plastic and sack packaging

o High resolution graphics, streaming videos of garments donned by models and 360° viewing .

o Discounts on periodic basis.

o Customer loyalty points o Recommendations for upcoming products.

o Securing size and interests in customer profile.

o Multiple payment methods (Cash-on- delievery, debit card, credit card, cash card, net banking).

o 3-d view of products and 500% zoom-in(full fabric –texture and

stiching lines view clarity.) o Vide range of sizes.

o Customers can key in their vital measurements to find the right

fit.

2.5 PROMOTION

Thus, there is a need for the companies to understand the difference in customer profiles and purchasing patterns

[buyingbehavior/shopping

experience/demographics/shopping orientation] of the buyers from data collected through online portals using

web-analytics tools. Thus, helping to create specific

campaigns targeted to specific segments.

Data can also be used to personalize user interfaces and to

provide them with product recommendations as per their preferences. It allows increasing customer loyalty as

buyers prefer to shop using interfaces that they are

experienced with.

It is an inverse scenario, as now people are talking about

product categories and services online, and now the

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retailers need to frame the questions from them and derive

a sample size from unstructured conversations of communities talking on similar subjects.

Online-customer experience need to be improved [like viewing product shots from various angles with zoom to

provide fabric-like feel], increase customer engagement by

social media strategy, blogs, twitter which provide a good insight and expert opinion which helps the user to make

the correct buying decision.

[34% of bloggers post opinions about products used & brands and

78% of consumers trust peer recommendations] Thus, the highest influencer in decision making is user reviews at 35%, followed by

social media networks like FB, Twitter and Youtube at a combined

total of 40%, implying that the word on mouth on social media has a great say.

13

Social Media Strategy [70% consumers use FB to be updated on

Brands]

Targeted marketing campaign, which will include :

A grand launch event

local media coverage and print advertising

campaign on all major portals.

fullest use of social media especially facebook.

Telivision Advertisement campaigns

13

https://www.pwc.in/assets/pdfs/rc-publications/WinningSector.pdf

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BECASUAL.COM BUISSNESS MODEL:

Four critical success factors

Fashion and pricing

The customer experience

Freshness of category

Long-term business model

Main Flow Process

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Back End Process Chart

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BE CASUAL- RESEARCH AND DEVELOPMENT

Innovate Create Dominate

Lifecycle leadership

Rapidly evolving customer demands, technology, competitor actions,

etc. are ensuring that product lifecycles shrink.

Customer needs (Planning and forecasting)

Establishing R&D and innovation centres market need in

terms of product size, pricing, fragrance, look-and-feel, etc.

Game-changing ideas

R&D identify game changing products. Discontinuous in nature, these products can redefine a category, create new opportunities for growth,

make products obsolete and help company establish leadership

positions in the minds of consumers.

Storage

Storage at manufacturing facility; maintainence by the manufacturer.

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Logistics:

Packaging

We are using Reusable packaging of nonwoven material

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CONCLUSION

Value sales of apparel are projected to be very strong over the 2011-

2016 forecast period, driven by a growing shift in preference towards

Western clothing and branded products, particularly across tier I cities. Companies are also expected to branch out to tier 2 and tier 3

cities outlets across India, which represent as yet an untapped market

for branded apparel. The increasing disposable income in these cities, comfort fitting and rich appeal are the major factors that are expected

to drive the apparel market towards long-term growth.