"We are aiming to touch Rs 1000 Cr turnover by 2020"

Divulging the larger future retail expansion plans of the company, Sunil Pathare, VC and MD of Maxwell Industries Ltd. spoke to Retailer Media over the target of opening 97 Inner Studios, adding 15,000 retail touch points in the current fiscal and 30,000 by 2018 in its retail network of 1,10,000 stores pan India.

What made you break the shackles of the traditional family business and start your own journey?

My father, Kolhapur born Jaykumar Pathare, the founder of the company was an electrical sub-contractor with state electricity board. He shifted to Kalyan, suburb of Mumbai for the electrical sub-station work. Then a sudden incident that took place in his life made him to take a decision to start a business of innerwear manufacturing with his good friend and colleague L J Reddy in 1971.

Considering the innerwear industry that was at its peak during that period, he took the decision to venture in. Coincidently both my father and Mr Reddy had no background of innerwear industry. They built this organisation on the basis of thought process, the vision, long term perspective and trust. That time there were no players operating in the market which made it easy for them to build the VIP brand.

How big is the Maxwell Industries market in India and what is your present market share?

Maxwell Industries brand VIP hold 20-22 percent of the market share.

What have been the leading milestones in your business?

Initially I was heading export division and now I am handling entire sales and marketing, financing and strategising the complete thought process of the structure being the vice chairman and managing director of the company, and that in itself is a milestone for me. Further, I will be more focusing on strategising part.

Tell us about your manufacturing base?

We have two big manufacturing units located in Thinglur, Tamil Nadu and in Umargaoun, Gujarat which contributes to 70 per cent of our total production. The rest of outsourced production comes from Tirupur, Tamil Nadu and Kolkata. Strategically, we will keep outsourcing our 30 per cent of production.

Previously, we had one manufacturing unit here in Mumbai but due to unfeasible policies of Maharashtra government we had to move to other states.

What is the present turnover of the enterprise?

For the fiscal 2014-15 our turnover was Rs 260 Cr and we are expecting to touch Rs 300 Cr by the end of current fiscal. Hence, we are aiming to make it to Rs 1000 Cr by 2020. Annually, we are planning to grow by 25-28 per cent.

What is the contribution of exports to the overall revenue of the company? Which are the major markets for exports?

Exports contribution is of around 10-15 per cent of our total revenue. We are exporting to around 15 countries, but our major destinations are Middle-East, Europe and US.

What are the future plans of the company?

Brand Consolidation

We were earlier working as functional department where sale and marketing, production, accounts and HR used to be individual departments. To touch Rs 1000 Cr we want all the brands under the holding of Maxwell Industries to grow.

Earlier, we were only focusing on top 10 products of VIP like VIP Bonus, VIP Frenchie, VIP Feelings among others and the sale was happening with these top 10 products, so at the bottom line there was a dilution of focus.

From this April onward we are following SBO strategy where even Frenchie will be a separate brand itself. Because VIP is a brand for mature person; Frenchie propagates the youth image; Feelings will be a brand completely catering to women; Eminence, which is a premium royalty based brand from France, will be a separate brand, Brat will be a kid’s brand and Leader will be a wholesale brand.

Each of these brands will be headed by a business head which will give focused attention to every brand. So now it will be a structure of a company within a company.  Each of the brands will have around 10 to 12 different styles. There will be internal competition within these brands led by business heads.  

Marketing

For the next five years much of our focus will be on sales and marketing activities, which will be designed in lieu with the persona of each brand. The brand leaders we are planning to take to more wholesale outlets in tier IV and V cities. We would like to strengthen the equity of each brand.

Category

We are planning to come up with a range of styles leveraging the price points in VIP and Frenchie apart from launching loungewear in VIP, Frenchie and Feelings. With the move, we are also planning to upgrade the aspiration level of consumers of VIP on a premium side.

With the launch of premium wear, women wear and men wear we would like to extend our presence to premium LFOs. Right now we are focusing on Central, Big Bazaar and to some extent Pantaloons; moving ahead, we will target Shoppers Stop and Lifestyle with our products of Eminence and new range of VIP. The premium price range of inners will start from Rs 150 to Rs 350.

Further, we are planning to change our women innerwear products into fashion oriented products keeping in mind the young generation. In the coming two months we are planning to launch women’s inners in Eminence. It is already there in France and we are bringing it in India. We will be starting with panties. Two years down the line we will be focusing on women’s innerwear segment which is growing by 16 percent YOY.

We want to change the perspective of innerwar. Maxwell is always been considered as innerwear brand and we are trying to change it to complete intimate wear brand. Accessories such as socks will be one part of it. Further the yoga wear and active wear can be the sub division under loungewear in the coming three years. The existing price range of our products starts from Rs 75 to Rs 600.

Retail

So far we have opened up 7 Inner Studios and are planning to open up 93 more Inner Studios in the coming three years. We are planning to tap tier II, III and IV cities which will give us more focus as a brand. These cities are yet to experience the organised retail channel. Each of the stores will be of 300-350 sqft with the franchisee investment of Rs 15 lakhs. The Inner Studio will offer lingerie to loungewear apparels crafted under different brand names under Maxwell Industries.

With the launch of loungewear we are further planning to add 15,000 retail touch points in our total retail touch points count of 1,10,000 by the end of the current fiscal. And with the expansion of few more categories we are planning to touch overall 30,000 retail touch points by 2018. Ultimately we are planning to increase our retail base by 20 percent every year. We are increasing 10,000 to 12,000 stores in our retail network annually.  

Online

We will soon be launching our own website where consumer will be able to buy our products online. The website will be as competitive as the online and offline marketplaces.

Technology Partners

For supply chain we have tied up with SAP. We have also tied up with various logistics companies such as Safexpress to take care logistics in a better way.

For these expansions plans we are investing around Rs 60cr of working capital.

Export

Very soon we are planning to tap African continent by exporting men’s innerwear under VIP to Nigeria and Ghana.

When you joined the business and what was the advice you have received from your father?

I joined business in 1991. I had given no limitations on accelerating business by my father. My father advised us to focus on each and every step that we will take up.

It’s not about taking a wrong decision but it’s all about taking decision at the right time. If you don’t take decision on right time then what’s the difference between entrepreneur and an employee. Entreprenuer has to be adventurous, self confident and experienced person. Taking a right decision on right time is an achievement for the entrepreneur.

First I joined the export division which was contributing to five percent to total revenue. Then I took to 10 percent to 12 percent. I decided to bring professional way of working to replace the conventional way of working.