User and Market centric Innovation

(AN ARTICLE WRITTEN FOR CHAIRMAN, AEPC FOR ET RISE)

Product innovation, rather than process innovation may be a great starter for small enterprises setting their first footstep into garment exports. Product Innovation in Fashion is today an intersection of statistics, technology, trends, material, and aesthetics rather than a mere outcome of trends and preferences.

Shoppers today have become very mindful of conscious consumerism. There is a clear interest among the consumers now, towards consuming everything, including clothing, with responsibility. Brands and in turn, manufacturers, cannot afford to ignore this and must work to provide convenient solutions within these new parameters. As a result, Circularity, Sustainability and Traceability are fast becoming the guiding principles of innovating and manufacturing clothing. It is not necessarily about what you make, a lot of times it is about how you make, that now matters!

This is more easily said than done- However, it may be wise to embark on your journey in the correct direction right at start, albeit slow! Businesses which adopt this ideology, when small, will find it far easier to grow into them than those which attempt the transition at a mature age. For an established organization, while the finances involved will certainly be steep, the challenge to transition work habits of those involved will probably be steeper!

Having set these as the principles of manufacturing, there are many other elements that should be given due significance in product innovation. The primary factors that should drive Product innovation in apparel, in my opinion, may be listed as below-

• Your target market- Identify the specific country you intend to export to and are manufacturing/designing for. It may help to know that the top Ready Made Garments (RMG) export destinations for India are the United States followed by United Arab Emirates, United Kingdom, Germany, Spain and France (not considering European Union as a single destination). While India’s share in imports of these countries has more or less been rising, except UAE, over the past few years, Netherlands and Italy also have been very welcoming for India made RMG. What may be of deeper interest to MSMEs are the markets of Denmark, Japan, Australia, Republic of Tanzania or Mexico- countries which hold huge potential for the Indian Ready Made Garment ( RMG) manufacturer and exporter. There may be more merit in reaching out to these new lands and striking roots here.

The Ministry of Commerce, Government of India, has been tirelessly working to support the industry with a favourable international environment for trade and business. India has a Comprehensive Economic Partnership Agreement (CEPA) with Japan which provides exporters with zero duty access in Japanese markets. The India-Singapore Comprehensive Economic Cooperation Agreement (CECA) gives a similar favourable positioning to Indian RMG imports in Singapore. Korea, Chile and Malaysia are also very suitable lands for MSMEs and beginners to explore in the backdrop of their trade agreements with India. Among the many advantages of exporting to these countries, the foremost is the landing price advantage for Buyers in buying Indian garments and the consequent preference for India as a sourcing destination.

A detailed understanding of your Buyer and End- User in the target market is imperative. The preferences of your user in terms of garment circularity( cradle to cradle), silhouette, material, colour, surface and finish should be analysed well- A first hand market survey and few international trend forecast agencies may be able to assist you in decoding these preferences.

• Your competition- It may be wise to know your competition well and the edge other manufacturing nations have over yours- the landing duties or benefits for goods from your country vis a vis other exporting countries like Bangladesh, Vietnam, Sri Lanka etc and the latest trade statistics between the nations. In recent times, certain product categories have been vacated by China and this has presented a huge opportunity for India to strengthen its foothold as an exporter. Tracking such international movements in global market and exploiting suitable opportunities can impact your business very positively.

• Scope of continued business growth– A research into the scope of growth within the product category you are exploring will also be very beneficial. Apparel Export Promotion Council can provide great support in this decision making through reliable market reports and statistics. The product categories in which India has a significant presence on the global export market, along with their HS(Harmonized System)  codes, include the following:

610910	T-Shirts Etc Of Cotton
610990	T-Shirts Etc Of Other Textile Materials
620520	Mens Or Boys Shirts Of Cotton
611120	Babies’ Garments Etc Of Cotton
620640	Blouses, Shirts Etc Of Man-Made Fibres
620630	Blouses, Shirts And Shirts-Blouses Of Cotton
620443	Dresses Of Synthetic Fibres
620442	Dresses Of Cotton
620342	Trousers Bib And Brace Overalls Breeches And Shorts Of Cotton For Mens And Boys

• Your strengths– Make what your people can make- An honest assessment of the materials and skills available helps make wise choices in curating the product basket you can offer to your Buyer. While this is in no way an attempt to discourage experimentation, it is an advice to exercise one’s intelligence and business acumen before entering a product. It is no news to anyone in this domain, that Indian manufacturers have always enjoyed a strong position in production of cotton spring- summer garments over manmade fabric autumn- winter wear- a decision more driven by availability and cost of raw materials and skill experience of labour than by market demand. 

Marks and Spencer, the leading global apparel brand is one of our most important buyers. During one of our recent conversations over coffee, said Nidhi Dua, Country Manager (Sourcing), Marks & Spencer India Pvt Ltd.,“ Product innovation is a continuous process and is key to gaining competitive advantage and creating value for the customers. Product innovation can be used to enhance the functionality, performance and appearance of a product, as well as improving cost viability or making it more environmentally friendly. Innovation helps companies to differentiate their product from others in the market, thereby winning the hearts of the customers and building a strong foundation for growth and profitability.”

That sums it up all very well.