Ethnic wear fuels fashion house’s city foray

Shivani Poddar, who co-founded the Noida-based fashion brand along with her school friend Tanvi Malik in 2012, tells us, “We have two brands – FabAlley for western wear and Indya, a fusion wear brand. We started as an online brand – with 75 to 80 per cent of our business coming from online channels, through our website and channel partners like Myntra and Jabong.” 

“Two years ago, we started our offline flagship operations, for which we initially tied up with Central department stores (of Kishore Biyani’s Future Group), with whom we have 60 shop-inshop (SiS) outlets pan India. About 5-6 months ago, we started our Exclusive Brand Outlet (EBOs), one in Bengaluru, three stores in New Delhi and now this fifth store in Chennai.” 

She adds, “We have a large online business and we found that Chennai was contributing to a great extent of our sale in the Indya brand, owing to South India’s affinity for ethnic clothing, which is even more than North India’s. The idea was to have 5-6 stores in key South markets like Chennai and Bengaluru.” 

Studies show that the market for online fashion retailing could exceed $2bn in India right now. But that is still 2 to 2.5 per cent of the overall retail market for fashion. While the online market is growing exponentially, it is still a fraction of the overall market. Shivani says, “That was impetus of branching into the offline model. The overall investment in the company is between $3-4 mn, including the bootstrapped component. Around two months ago, we closed a round of venture debt with Trifecta, to the extent of Rs 5 cr. That was directed towards offline expansion and working capital requirements.”

When asked about the secret of sustainability in the aggressive e-commerce space, Shivani explains, “Ours is a pure product-led business. We create design differentiation in how the products are made and retailed at an affordable price point. At FabAlley, the average price for a garment would hover around Rs 1,500. We are also a capital efficient company unlike many start-ups that have burnt a lot of cash. Our annual gross merchandise value (GMV) stood at Rs 80 cr and we are going to be EBITDA positive this year, one of the few e-commerce companies to do so, in this range.”

Talking about the plans for the future, she says, “By the end of this year, we hope to open another 20 EBOs, bringing the total to 25 pan India. Chennai, Bengaluru, NCR, Mumbai and Pune are the cities we are keen on. We have grown 100 per cent in FY18, and the target for FY19 is to double the business. We also have a sub brand, a plus size brand called Curve. There is no competition in the plus size space, which is yet another growing market in India. So, we will be growing that brand as well.”