Zashed is a self-funded-operated bootstrapped fashion start-up moving to e-commerce tech with a gross merchandise value (GMV) of US $ 9.37 million (Rs. 70 crore) with only seven brands being pushed in the market and there are over 20 that will be penetrating the international market within the next 2 quarters. Hence, the company is expecting over 150 per cent growth post the market resumes.
In conversation with Mithun Bhardwaj, CEO, Zashed Fashiontech, Apparel Resources tries to ascertain how the company is helping exporters strengthen international presence.
Mithun has always wanted to create multi-faceted brands. While on a flight to Delhi once, he thought of his discussion with an exporter and how India has given the world yoga, architecture, heritage and traditions. One more contribution that must be added to the list is fashion. India has long been a muse to the international fashion. Indian export houses were manufacturing for high-fashion brands and boutique labels across the globe, while delivering unmatched excellence across the garment industry, Mithun noted.
“Counting on these inspirations, I thought of an innovative business plan to solve an existing problem, and at that moment in the flight, wrote down my first business plan on a tissue paper. The plan was to merge fashion and technology to create a robust pool of brands on a global scale,” Mithun reminisces. Thus, Zashed Fashiontech was born.
Understanding the gap
“Indians have continued to consume international brands at a fast rate. We don’t have Indian brands in the Western domain. Fashion is possibly the easiest of the vanities to ponder on and easier still to lure moths. But then, we haven’t seen Indian brands come alive in international glossies. The Zashed business model is inspired by Make in India and Digital India campaign to build domestic brands, which can be recognised globally in the fashion arena,” Mithun highlights.
Zashed is a one-of-its-kind fashion business conglomerate that dared to be different by combining design and data, and excelling in the art of brand building. It identifies the core strength of an export unit and leverages it to ensure maximum customer satisfaction. It takes the brand into the D2C market by offering customers newness in every aspect.
“From the start, we wanted to help the exporters to cut their dependencies on the international buyers and become their own buyer. Zashed used the same infrastructure, machinery, capability, fabrics, etc. they were using to fulfill international orders to help them create their own brand to enjoy the retail margins as opposed to the manufacturing margins. It’s a Business Process Reengineering model by decreasing the need for management layers and accelerating the information flows using the existing business model to take brand into the D2C market, which is from factory’s floor to customer door,” Mithun elaborates.
Mithun mentions that every exporter eyes volume and margins. Through Zashed’s model and efficient team, they are able to fulfill the exporters’ expectations.
Winning over the challenge
“The challenges we faced were not production capacity or design capabilities, but the psychological ability to comprehend the dynamism of the Indian market and how the market was evolving rapidly. Most exporters were operating on EOU (Export Oriented Unit) and had no idea about the domestic market and consumption. The international market has not been much of a problem because it was mature. With Zashed, we want to convert the challenges into a fair competition, which we are ready to win,” Mithun shares.
While discussing the long-term business arena, Mithun continues, “The economic shocks that follow the COVID-19 pandemic come at a time when the sector was already struggling from the after-effects of demonetisation and other declining economic indicators. In fact, coronavirus has nothing to do with exports primarily; it has ignited the pre-existing problems because since 2016, exports have been stagnant. Also, when we say exports are not growing, we are not suggesting that manufacturing will also not grow. Manufacturing is here to stay and a ton of domestic consumption will take place. There is always an alternative because what got them here will not take them ahead. Many global buyers are expected to file for bankruptcy or go into liquidation, which would leave exporters in India with crippling levels of bad debt. It is certain that closing stores and factories across the country for a period of 3 months has cost India’s textile and apparel industry dearly. The export sector is already besieged with cancelled orders and a drying up of future orders for the next 4-6 months. Domestic consumption is the last oasis, but with the shutdown of all forms of commerce, stakeholders are left with few options.”
Hence, without fresh export orders and orders on hold, many garment producers were forced to shut shops entirely or inflict stringent cost-cutting measures, including layoffs, Mithun stresses.
Zashed is all set to launch its own e-commerce app that will include all the in-house created labels across categories. They are also set to launch their state-of-the-art digital imaging space and content creation lab in September 2020. A first in the country, the New Delhi studio will have its in-built pool for underwater shoots.
“Our aim is to make Zashed the best place to buy fashion online. We focus relentlessly on innovating the customer experience, and we approach our fashion business through the same lens. In fashion e-commerce, high-quality imagery and videography are essential. Our editorial will inspire the customer, and our product pages – the way we will show how clothes fit and move – will be our virtual sales associates. Using live models help show the movement and flow of a garment in a way that is often difficult to replicate with mannequins alone. The studio will also help us to create fashion videography which will be moody, stylised and often experimental,” Mithun mentions.
Zashed is also in the process to partner with Middle East-based e-commerce platforms to launch the fashion brands under their hood. This international expansion will be a significant milestone for Zashed.
Being a data-driven and product-centric company, Zashed uses their FEBA (Fashion E-commerce Business Architecture) and GOBA (Glocal Omnichannel Business Architecture) to offer a 360-degree brand plan to anyone approaching them. Right from the complete brand base architecture plan and blueprint, trend analysis, mood board, product designing, fabric sourcing, tech pack, target product cost, defining price bracket, categories, inventory analysis and planning, feed intelligence on the growth plan, marketing plan (celeb, etc.), pricing structure, discount plan, brand structure, valuation and growth roadmap, expansion into different verticals of retail and eventually expanding to different countries, we take care of everything. Product is the pulling factor in the whole scheme of things, and for a minimum of 5 years, the brand is played out into an omnichannel environment in the domestic and international markets.