Retail webinar discussion from Sharmaji’s view point
Surviving the present impact on fashion business.
Future impact on fashion business.
Measures to be taken care of; post pandemic.
 What relief should be asked from government?
 Webinar was held at 1 pm on 17.04.2020. It was interesting to attend as 5 key people of fashion industry came together to discuss the present & future impact of global corona virus pandemic. I have tried to sum up things though it was an hour webinar it took me whole day to create pointers for better understanding. Â
Bijou Kurien: independent consultant LVMH Group.
Bijou started on how they see this pandemic and what impact they see on fashion industry.
What 3500 employees are actually doing when the whole country is lock down with stores closed?
Are employees still on company pay roll, any salary deduction done or are making sure they come for reemployment, skilling them to gain something??Â
How do you manage the inventory of the season???
Few brands lead time is pretty long so asked in store inventory on tap inventory supplies made for shipment lying in warehouses or aligning with suppliers itself.
Preserve employment it’s a rather more of a emotional perspective?
What are the points certainly you must consider writing the letter to the government you think apparel industry needs to survive.
What are the changes seen temporary or permanent in the future when consumer starts coming back to stores?
Define the new normal in a more detail of product or pricing and some other implications.
Mr. Bijou Kurien who is a consultant & member strategic advisory board, L catterton Asia (A part of LVMH group) added that right now we are facing is a health pandemic & economic shock while way back in 2008-09 it was only an economic shock.  Â
Here, I have tried to bring as much filtered discussion as possible in two parts. So i first took the answers of Mr. Shailesh chaturvedi. He is CEO& MD, Tommy Hilfiger apparels, Calvin Klein India and arrow. He started with addressing about two things,
Short term & long term impactÂ
 Within these 45 days revenue was zero but expenses were as it is.
 100 days ending June, this season, diwali & wedding this year. Response when the lock down gets over.
Long term: As industry is suffering from commoditization in fashion, have to take care of team & cash flow.
As our industry works on a 9 months cycle, Inventory is heart of the business model in our industry. 50% of the cheques signed are for the inventory somewhere, whether importing inventory, paying to vendors in India it is a large part of the cash flow.
There is spring summer, autumn winter & in between there’s prefall which is early season, so some part of summer goods will carry forward into early fall in india cutting some prefall goods. Mr. Shailesh further added that we don’t want a brand to panic and give much of discounts and spoil the market. Mr. Shailesh suggested a strategy of hold it, cut it, take it to the next season and hope fully you will get normalize by Feb- march 2021.
Post pandemic Once the lock down uplifts in a staggered manner precautions need to be taken so that customer feels safe that his or her health is not going to get jeopardise while shopping, making sure employees feel safe as well.    Â
Smaller shifts to start with, less numbers of staff to make sure social distancing norms are applicable while limited customers allowed into store.
New respect for capital, As people in india has gone on growth through balance sheet not through cash flow
Message to employees or people in the industry is to have to be domain expert in something be good at something small.Â
Crises putting focus on working together as a team, Mr. Shailesh further added let’s get out of dooms & gloom & pessimism.Â
Mr. Vineet Gautam, country head at bestsellers since January 2010. Did a brief and valuable discussion about this pandemic which came out of the box and china shut its 7000 stores!
It was tough to see India will lock down 1.3 billion people. He added further its 1/6th of the world’s population.Â
First thing are employees & customers But the business will take 9 to 12 months to be back on normalcy, where cash is the most important part and safety the next.
Putting 3500 employees in two parts
SE: Engaging with them / upscale skills.Â
BO: Relook at our business model from back end life beyond the lock down & to plan at numbers to look at the perspective of supply chain.
First responsibility is to protect jobs till the time we can manage to.
Government needs to work on some mechanism to allow companies to get some cash flow or else things will become more challenging where there is no cash coming in but continuous outflow.
Stores will open up in bits and pieces while warehouses might get little operated. As Maharashtra has allowed warehousing in some parts.  Â
Opening up store at full capacity may take several weeks Like in china it took 3weeks to reopen 7000 stores.
Germany said anything below 800 sq ft is okay above 800 sq ft it is not okay.
Business is not going to be there at 100% manpower.
Demand starts at about 30% and then week on week it will rise.
i .New normal is alot more moving online.
ii. (Hyper local) where customers don’t have to wait for hours.Â
iii. Purchase will back up till diwali or spring summer 2021.
“Structural changes are going to happen in the industry“Mr. Amrish MD Ritu Kumar said. Need to recreate employment in long term as soon as possible.  Â
Season in terms of fabric in india changes in October prior to that little bit of buffer of summers will play its role.
Requirements of credit periods need to be extended.
Requirements of working capital need to be extended.Â
Flexibility and insuring that business can get back on their feet so that employees will get back on their feet.
RBI should loose up of what small / large size business have access to.
  Phase 1 will be Store recovery and how many stores can be opened.Â
Phase 3 will be going to a sort of a long term demand curve.
In India online business will definitely grow as a result of this pandemic effect. But are still value discounted economy. We are not china not Europe or USA. We are not full price economy.Â
Top end of the market might temper which was impacted during demonetization and now.
People buy things to keep for longer.
“At the backend automation will take a front seat” said dalpat Jain. CFO Manyvar.
 Hangover of corona will remain for some time. It will 12 to 15 months to get back on track.
Mr. Dalpat emphasized more on three pointersÂ
As Bangladesh has provided loan to industries from 2 % to 5% Int. Rate If we write a letter to government, expectations are of some relief on GST. In the end he kept it short about the impact.
Consumer side appointment base sell.
Safety standards will not become a point of marketing it will become a must have and consumers minimum expectations.
Pricing front Luxury will be at affordable price.
In the end all these discussions by all these industry giants lead to few queries which i thought to bring on the table.
Recreating employment as soon as possible after lock down lifts up, is this indication of cost cutting through reducing employees once store opens up?Â
How can fix costs can turned to variable cost?
  Permanent measures once lock down lifts up would be safety of consumers and employees. How many consumers would be allowed at once with proportion to how many employees at a store, so social distancing could be maintained?
As stores will take several weeks to open up and 100% man power won’t be required at first. So will the rest of the employees get paid for that?Â
What impact smaller shifts will have on business as most of the business was used to be in evening?
 What about start ups in India?
  Please share your views.