From humble beginnings in 1993, Indian Designs Exports Pvt. Ltd has grown to become a preferred supplier to some of the world’s best-known clothing brands, including GAP, H&M and Columbia Sportswear. Gemma Carter hears from Mr. Naseer Humayun, Managing Director, about the company’s ever-expanding manufacturing capability and strategy for future success.
Indian Designs was founded in 1993 in Bangalore, as an offshoot of a company that had been started by a group of cousins. Mr. Humayun tells us more about the business in its early years: “When I returned from the US after completing my master’s degree in International Business, I spent two years working for an engineering, procurement and construction contracting company called Tata Projects (Pvt.) Ltd. After this I wanted to do something on my own, and, at around the same time, some of my cousins were thinking of setting up a garment-manufacturing firm to do contract manufacturing for exporters. When I was approached to head the organisation, I said I would agree only if the long-term intention was to export. This was in 1988.
“It took us almost a year to approach financial institutions, obtain a loan of INR 400,000 and get

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the unit started. Indian Designs was eventually established in 1993, because of differences between some of the partners, and it has grown at a steady pace since then. In the financial year 1994-95 we had a turnover of INR 52 million, and in 2010-11 we had a turnover of close to INR 2 billion (US$38.9 million).”
“In 1998 we launched a local brand called ‘Identiti’, to cater to the domestic market,” he continues. “These products are sold via our own stores, most of which are located in Bangalore, but we also have stores in Kochi, Kerala, Hyderabad and Mysore. Most of these stores are owned and operated by the company, while two of them are franchises. Over the subsequent years, while we were focusing on exports, we could not give Identiti the attention it deserved. However, we are


currently planning to open more stores and increase the turnover of Identiti. In the 2011-12 financial year, Identiti should achieve a turnover of INR 110 million (US$2.1 million).”

Large-scale garment production

In 2000 the company joined forces with a partner to open an office in the US, in New York City, of which Mr. Humayun was in charge. “I was stationed in the US for almost five months,” he remarks. “Unfortunately, upon my return I found that profitability had declined dramatically – it was one of the worst years in our history. As a result, I had to remain in India rather than returning to the US to run the office there, and the office was closed shortly afterwards.

“In 2004 we moved to our current site in Bangalore, which is on a much larger scale. Here, we have been able to build an office that suits our ambitions and a factory that we are proud to showcase to our buyers. On our total land area of 3.5 acres, we have a 20,000 square-foot office and an adjoining factory that covers 125,000square feet and includes our central washing unit. We now have a total of eight plants in India that can take in fabrics and pack garments, including centralised washing and embroidery units. Six of these units are

located in Bangalore and the other two are located about 80 kilometres away, in Bangarpet.”

The company’s facilities are equipped with the very latest machinery and infrastructure, including power-operated sewing machines, pocket welting machines, automatic jig machines, fusing machines, smocking machines, toppers and metal detectors. With regard to its in-house functions, Indian Designs has self-contained departments for sampling, design, embroidery, computer-aided pattern making and cutting, and batch production, as Mr. Humayun explains: “Our fully self-contained

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sampling division ensures swift, efficient and accurate development of prototypes and samples to meet the needs of our many buyers, while our experienced in-house creative designers constantly monitor global trends and incorporate new ideas into fabric and garment developments on a seasonal quality, so although we have been through the ISO 9001 certification process, we did not proceed with obtaining the certification because we did not believe it would add anything to the overall quality of our product and service offering. Most of our buyers permit us to carry out our own quality inspection before shipping the products out to them because they have trust in our ability.”

In order to keep the skills and ability of its workforce up to date, Indian Designs operates training centers in collaboration with a government-funded programme that aims to provide textile workers with skills in sewing and other disciplines that are required in the factory. “The garment industry as a whole is quite labour-intensive – there is only a certain amount of automation that you can employ before quality is in danger of being jeopardised,” he notes. “However, we do implement certain engineering practices in order to enhance


productivity and increase efficiency, and we employ several industrial engineers who work on the factory floor. Similarly, we strive to stay in touch with the latest trends in the market in terms of design.
Ultimately, the designs for our products are chosen by the brand or buyer, keeping in mind the region or area in which it operates, however, it is becoming more important for a company of our size to provide the right inputs for buyers. We have a design department that studies trends in the market and comes up with specific ranges for the buyers that ask us for collections. Then, the buyers and our design department collaborate to ensure that the right product goes into production. In some cases, we provide fabric swatches to buyers, who start their design process for the season with this contribution from us.”

Retaining cost-competitiveness

The geographical distribution of production in the textile and clothing industry has changed dramatically over the past century – as means of communication and transport improved and became cost-effective, Western buyers found that they could produce their garments in cheaper, far-off regions of the world and bring them back to their markets for selling. Meanwhile, consolidation has been taking place in the retail basis. The laundry department, which is equipped with modern high-capacity industrial washers, is capable of

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handling around 20,000 garments per day, and of performing enzyme, stone, bleach, chemical sand, distress, pigment, spray and softener washes.”

Buyers from the West

Indian Designs currently employs around 10,000 people in total, and is capable of producing up to two million pieces per month. These products encompass a range of casual garments for men, women and children, including shirts, bottoms and tops. “Cotton is the primary material that we use for our products because India is one of the world’s largest producers of cotton,” Mr. Humayun reports, “and there are many varieties of cotton fabric that are widely available in the country. In addition, we are certified to process fibres from accredited growers of organic cotton.

“We produce garments for numerous international clients, including Adidas, Banana Republic, Benetton, Columbia Sportswear Company, Decathlon, Esprit, Fat Face, GAP, H&M, Mothercare, Old Navy, Quiksilver, Ralph Lauren and White Stuff, and we export to the US and throughout Europe. The UK is one of our biggest markets, and we are always looking for new customers there. One of our newest customers in the UK is Crew

Clothing, a UK based retailer that specialises in luxury casualwear for men and women, and we recently started working with George, which is the clothing range owned by the Asda supermarket chain. H&M is one of our biggest customers, and we are one of its largest suppliers of girls’ tops. Between 55 and 60 percent of our production is exported to Europe – of which 15 to 20 percent is sold to the UK – while the balance is exported to the US.

“For us, our greatest marketing point has been our performance,” he asserts. “We cater to brands or stores that sell directly to the end customer, and we have always focused on


delivering quality garments at the right price on the promised date. So far, we have not had to worry about marketing or promotions. We keep growing with our existing customers and, luckily, whenever we have expanded our capacity, new customers have called upon our services. We ensure that we operate with integrity as an organisation and this, I think, has helped us expand our business.”

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High-quality garments guaranteed

As would be expected, the company operates a fully-fledged quality assurance department, which ensures that all garments leaving its factories adhere to the highest quality standards. “Apart from having one person in charge of quality at each factory, we also have individuals who are committed to looking after the products of each buyer,” Mr. Humayun informs us. “This creates a lattice-type structure, which ensures that the garments manufactured in any factory for any buyer conform to the required quality specifications.

“Of course, most buyers have their own quality policy and offices for controlling industry, which has led to stores and brands growing in size and clout. “Low-wage countries gradually became hubs for garment manufacturing,” Mr. Humayun observes, “and,

in a way, this led to the economic and industrial development of those countries. However, once the countries reached a certain level of development and their incomes increased, the manufacturing of garments moved to other countries.

“If we are to retain our competitive edge as a garment exporting firm, we have to ensure that we manufacture garments in those regions that can offer the competitive cost advantage. To that end, we are currently exploring opportunities to expand our manufacturing base in other low-wage countries,” he reveals. “I have recently made a few business trips to one particular country where we are considering setting up a manufacturing unit, in order to take advantage of its cost-competitiveness. This country enjoys duty-free export status to most of Europe, which would be extremely beneficial. If everything goes to plan, we should be able to establish a new facility there by the end of 2012.”

Indian Designs’ capacity in India has doubled in the last two years, and the company has gained several new customers, such as Decathlon, Benetton, Adidas and Mothercare.

In the next five years, however, the company intends to grow by five times, reaching a turnover of INR 10 billion (US $194.8 million). “This is an ambitious goal, so we will also have to expand our facilities in India, employ more people and target new markets and buyers,” Mr. Humayun comments. “For example, we hope to start working with Carrefour, and we plan to target more buyers like this. We hope to have a new facility in India by the end of 2012. Geographically speaking, Japan and South America offer some opportunities for export, so we are also exploring those markets. It is going to be a demanding, but hopefully exciting journey and we are looking forward to it. Going forward, India offers us the advantage of a strong market.”

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