The term ‘globalisation’ has been ringing in our ears since the 1990s, but it is only recently that we understood the essence of truly being one large community. With technology, medication, and trends reaching us within minutes, the global community presents a much more optimistic outlook for industries and markets looking to expand beyond the threshold of their nations. Additionally, the online fraternity has led to growth by leaps and bounds, sometimes multiplying faster than is gaugeable.
In fact, it is worthy to note that the prospect of shopping beyond one’s own country has been gaining momentum like no other. The global cross-border online shopping market is expected to grow at a CAGR of 25 per cent up to 2022. The numbers reflect not only the growing acceptance of the norm of shopping internationally from the confines of one’s home, but they also paint a picture of prosperity for all retailers who briskly catch up with it. In 2014, only about 26 per cent of online shoppers purchased from websites based outside of their home countries, but this has now grown to over one-third of the total online shopper base globally. Cross-border online shopping is largely driven by lower prices and limited availability of brands or products in the home country, which is a potent motivator for two-thirds of shoppers across the world today.
This opportunity is in no way lost in the Indian market. A study conducted by San Francisco-based online payment processing firm Stripe revealed that India ranks 11th on the list of online companies catering to international markets. What’s most interesting is that new Indian start-ups in recent times have expanded overseas more aggressively and earlier in their growth cycle than their predecessors.
For some, the growth to international markets has been a natural one. Doodlage, an upstanding, zero-waste Indian start-up and slow fashion brand is taking not only India but consumers in US, UAE, Australia and parts of Europe by storm. “The expansion has been organic; we expanded with likeminded companies and people who wanted to promote what we do. Direct consumers connected to our website through social media, print and online articles; hence, we mainly work with e-commerce in these territories for now,” says Kriti Tula, Co-founder, Doodlage.
With the backing of promising technology, numbers and examples, it is intriguing to learn the take of established brands, export magnates and start-ups in India successfully catering to international clientele. Despite the many challenges, access to the global sphere has become increasingly easy and with the right product and supply chain in place, the growth is as exponential as the brand wants it to be.
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The seeds of expansion
The Indian export portfolio has become more diversified in every sense in the recent years. As of today, the top 20 export destinations in the world account for approximately two-thirds of total export from India. The US is still the top destination for exports, but geographies such as the UAE accounting for 11 per cent, and Hong Kong making up approximately 4.4 per cent of Indian exports are also key destinations, according to a report published by FICCI. Indian exporters are also focusing more and more on developing nations rather than the developed ones, as they are up and coming as more lucrative export destinations.
Donear Industries Ltd., a foremost manufacturer and retailer of fabrics in India, has spread its wings to over 25 countries across the world. With a stronghold in North America, Europe (including the UK) and Latin America, the company is not shy of venturing into unchartered territory in Asia too.
“As a company, we have already started communicating with South Korea and Japan. While we try to develop a relationship with any country, it usually takes at least 1-3 years for the foundation to strengthen. We started talks last year and even got a few orders. Although the pandemic slowed things down a bit, we are focusing on getting back on track with these countries this year itself,” says Rajendra Agarwal, Managing Director, Donear Industries, while explaining their plans of expansion to Taiwan as well.
In 2016, India exported goods across the apparel segment worth US $ 20 billion, as per data released by the Department of Commerce. However, while both textiles and apparel exports are steady markets, the export for branded apparel remains limited. Perhaps, this is an area of improvement for the Indian fashion and apparel industry to consider. Despite there being huge demand for unique product offerings with an Indian taste, the demand for branded Indian apparels could be falling short due to lack of brand and marketing initiatives or strategic alliances.
Flying Machine, a home-grown denim brand under the banner of Arvind Lifestyle Brands, has been somewhat slower in its pace to reach international clientele, but the export business has so far grown to encompass the markets of Dubai, Mauritius, and Sri Lanka.
While reiterating that every opportunity is worth exploring in the international sphere, Himanshu Mahajan, Business Manager, Flying Machine, avers, “We don’t hesitate as soon as we see a department store or distribution business we can work with, but there is a dearth of channel partners who can support a company’s endeavour in going global. A company might now want to take on all the work itself, but with the right channel partners, every business has a tremendous prospect of blossoming internationally.”
An aide with ‘Local to Global’
India, with its own strengths in manufacturing, is well-equipped to service any developed nation, and its strong portfolio of original ideas and unique product ranges are pulling in shoppers.
PM Modi’s recent agenda to put India on the map has led to the initiative of ‘Local to Global’. “Global brands began locally. But when their people started marketing, branding and praising, they became global. Every Indian should become vocal for local. Don’t just buy, but promote,” the Prime Minister announced, calling for a self- reliant India in May during his third address to the nation since the announcement of a lockdown. The move could result in higher quality products as Indians changed perceptions about domestic brands, holding them to the same standards as a global player.
Nonetheless, with the motivation for making India a superpower, the onus of going global not only lies in the hands of the consumers, but also depends on the companies that are fortifying themselves to take on international giants zealously. “The ‘local to global’ initiative is a value the company already had big plans for and now that we have the support of our PM in this mission, I’m very hopeful that this will lead India to becoming a leading global economy,” says Mansi Gupta, Founder and CEO of online-first ethnic brand Tjori.
Born in 2013, the start-up has created quite a foothold in the hearts of Indian consumers and has now spread its reach to almost every country on the planet. In fact, the buck doesn’t stop there for Tjori. With the help of emerging technologies and the ease of access to the internet, they want to cater to every corner of the world through their e-commerce platform. The brand is very well received in global markets with its unique aesthetics and traditional arts and crafts, representing the very ethos of India.
But the atmosphere for growth to global markets may not be all hunky dory as they say. The Indian garment manufacturing and apparel industry is plagued with a few well founded concerns that are its biggest hurdles in becoming a global leader.
As Rajendra Agarwal very rightly puts it, “The idea of ‘local to global’ is great, but the right execution is very important. India has the raw materials and we can create the infrastructure too, but the only thing needed is support from the government in the direction of labour reforms. There are some misconceptions about labour reforms, and in my opinion, there should be healthy dialogue about this in an open forum.”
“In India, there is a notion that there is a dearth of employment, but in reality, we all find it difficult to get skilled employees. However, once employed, no company can retrench the worker which the workers and worker unions take undue advantage of. The government should introduce certain guidelines under which a worker can be removed and another one can be recruited. This would not only prompt workers to work more sincerely, but would also increase competitiveness, hence leading to faster growth in wages,” he adds.
In his opinion, focusing on the right infrastructure back home along with working at the ground level will provide impetus to every industry in India, improving the quality of products.
What lies ahead?
The blow from the lockdowns and the fear of catching the virus have weighed heavy on brands for the better part of this year. Supply chains are a little broken with workers and artisans back in villages, and the production capacity for most has reduced to around 50 per cent (Donear and Doodlage), but online sales have been picking up slowly.
So, while all brands are facing the brunt of the pandemic on a large scale, plans of expansion have hardly been put on hold. As Mansi puts it, “We, as a steady growing venture, also faced some difficulties, but kept the momentum of growth going, so in a way the pandemic helped us work 10 times harder to ensure the growth of the company,” reassuring that brands striving for stable ground will likely emerge victorious from the grasp of COVID-19.
In fact, most of the brands admit that the India-China standoff is also one that has not affected them to the extent of disrupting their supply chains. Flying Machine even redirected a part of their order from China to Bangladesh in view of the tensions. This is testament to the efficacy of India’s self-sufficiency that comes forth at a time like this.
When it comes to supply chain, brands find themselves working for consumers abroad in a manner similar to that in India. Apart from shipping internationally, there are hardly any added hurdles or steps they come across. With the right ideology and the right connect with clients and consumers, any brand has the potential of making a mark on the world map.
“For decades, global markets have determined how much our local artisans are paid as part of their supply chain. When we support local brands aiming to sustain better wages for their artisans and workers as they scale, we together reduce our carbon footprint and help bring long-term changes in our communities and improve our overall standard of living. That’s an aim worth working towards, that’s what makes ‘local to global’ important,” says Kriti Tula.
Setbacks are a part of business, but India has all the resources to be able to build global fashion businesses. The challenges are real, but can be overcome with the efforts of an entire community. We have already witnessed the footprints of Indian aesthetics on the world, but with the digital reformation of India as well as growing interest in manufacturing, the country has the prospect to reach a respectable stature in the international fashion and apparel community.
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