The Ware­house, New Zealand opens sourc­ing of­fice in In­dia

• Home tex­tiles to be a ma­jor cat­e­gory from In­dia • Bangladesh will be de­vel­oped for ap­parel business

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Af­ter di­rect sourc­ing out of China for the last 15 years, The Ware­house Group has taken an assertive move to be nearer to what it con­sid­ers as the two crit­i­cal sourc­ing des­ti­na­tions to­day – In­dia and Bangladesh – with the open­ing of a sourc­ing of­fice in New Delhi, and which will serve as the ‘nerve cen­tre’ of sourc­ing from South­east Asia. While In­dia sourc­ing will be more fo­cused on tex­tiles and home wear, ap­parel will be the key prod­uct from Bangladesh. By the end of the year, other man­u­fac­tur­ing bases like Viet­nam, In­done­sia and Cam­bo­dia will also be ex­plored for value prod­ucts. Just a day af­ter the of­fi­cial open­ing of the beau­ti­fully lo­cated of­fice in the Aero City com­plex on the out­skirts of the Indira Gandhi In­ter­na­tional Air­port, Team Ap­parel Online caught up with The Ware­house team of Ta­nia Benyon – CEO – Group Sourc­ing Sup­port & TWL/WSL Mer­chan­dise, Nick Tuck – Ex­ec­u­tive GM – Di­rect Sourc­ing and Anika Passi, Coun­try Man­ager for an in­ter­ac­tive one-o-one. Ex­cerpts from the ex­haus­tive in­ter­ac­tion…

AO: What is the strat­egy be­hind hav­ing an of­fice in In­dia and what are the ex­pec­ta­tions?

We have been op­er­at­ing out of China since 2004 and we had buy­ers com­ing here but not with all that sup­port you get from hav­ing your own peo­ple on the ground as we re­lied quite heav­ily on agents. So, 18 months ago we de­cided that it was time we had an of­fice here in In­dia, as we knew we would have ac­cess to lot of coun­tries who are neigh­bours of In­dia.

In next 24 months, we plan to shift around 40 per cent of our Ap­parel/ Home business from China to In­dia. A lot of our home business is al­ready here like bed­sheets and tow­els. But we are see­ing lot of op­por­tu­nity in the home dec­o­ra­tive area as well. We have got some big tar­gets and are look­ing for 40 to 50 per cent growth. We will be investing here and in Dhaka and then ex­plor­ing rest of the re­gion as well. We have right now 15 peo­ple in Delhi and 5 in Dhaka; and in 6 months since we started work­ing from In­dia, we have seen a 250 per cent growth from last year. We have been lucky that we have had good sup­port of the business to in­vest. By the end of FY ’19, we want to do 80 per cent of our pri­vate la­bel as di­rectly sourced.

AO: How do you pro­pose to achieve these am­bi­tious tar­gets?

On an in­ter­na­tional scale, we may be small, but in New Zealand we are very big. We have 92 ware­house stores and 240 out­lets, and since the coun­try is small, it takes max­i­mum 30 min­utes to reach our re­tail stores from any des­ti­na­tion. Not many re­tail­ers can talk of that. We are re­ally a big part of the com­mu­nity be­cause every­body shops at The Ware­house and prac­ti­cally the whole pop­u­la­tion of our coun­try comes through our doors ev­ery month.

So, be­ing able to work with sup­pli­ers who can un­der­stand and have flex­i­bil­ity around vol­ume is re­ally im­por­tant. But then the other thing is that our business like ev­ery­one else is grow­ing online and that is our op­por­tu­nity to have more ex­tended range – more than you can put it in a phys­i­cal re­tail store. It is un­lim­ited, but the dif­fer­ence is the quan­tity you will have be­hind ev­ery item, and so we want to ex­plore out of this of­fice where we can have more ranges, test them online, risk them with small quan­ti­ties and win­ners will end up in stores with big­ger or­ders.

AO: Do you think the in­dus­try is pre­pared to do this sort of business?

They need to start think­ing a lit­tle bit more about ven­dor man­age­ment and com­pany pro­grammes. Right now, it’s a big de­par­ture from sim­ply man­u­fac­tur­ing in terms of tak­ing or­ders and see­ing the end as ship­ment; in­creas­ingly they should also be deal­ing with online re­tail­ers be­cause oth­er­wise they would be miss­ing the big seg­ment of the mar­ket…, so ven­dor man­age­ment and un­der­stand­ing the sup­ply chain will be the big thing go­ing for­ward. So, some­one like us will still do bulk or­ders be­cause we have got brick and mor­tar re­tail stores, but ex­tended ranges and mar­ket places are def­i­nitely op­por­tu­ni­ties.

To­day many ven­dors par­tic­i­pate with the cus­tomers in terms of help­ing them man­age pro­grammes through fore­cast­ing and ca­pac­ity book­ing. It’s the nat­u­ral next stage be­cause it’s all about speed to mar­ket. And, the thing

“We see if the ven­dor is eth­i­cal and whether or not they are aligned with our val­ues. If that door doesn’t open, we don’t go there. So, a buyer can­not place an or­der un­til we have made that as­sess­ment. We have our own code of con­ducts.”

with online is that it brings su­per speed to the mar­ket; we can’t ig­nore and need to move quickly. So, next move is manag­ing every­thing from raw ma­te­rial base to po­ten­tial ven­dor man­age­ment pro­grammes.

AO: What are the fac­tors that are bring­ing in the change?

Things are mov­ing fast, ear­lier mar­ket was man­u­fac­turer-driven, then re­tail-driven, and now it is con­sumer-driven. We need to un­der­stand them and that’s where sup­plier needs to un­der­stand us. The co-or­di­na­tion and col­lab­o­ra­tion will be more in­te­grated now. It is ex­cit­ing. There is a mes­sage in our business; be­ing faster and at the right time.

The old fash­ion of hav­ing sea­sons is re­ally gone. I think there is no sea­son any­more, it’s more like a trend. It changes ev­ery week. It started from ap­parel and now it is in home­wear seg­ment – not that fast, but it’s com­ing. Home and ap­parel are not two dis­tinct seg­ments any­more.

It’s very easy to have a best­seller and keep do­ing it. One of the ben­e­fits we get com­ing here and be­ing at the sourced is that you get more in­spi­ra­tion be­cause what we are telling buy­ers is that you can­not re­main same. You need to rein­vent your­self and we have to do that in col­lab­o­ra­tion with the fac­tory. No longer can you buy the prod­uct and keep sell­ing it for 5 years. It doesn’t work any­more.

And, more pos­i­tively ven­dors too have started think­ing about more ver­ti­cal busi­nesses and hav­ing de­sign fa­cil­i­ties and so the teams can ac­tu­ally work with re­tail­ers to cre­ate a new prod­uct all the time.

AO: How does Prod­uct De­vel­op­ment hap­pen at The Ware­house

We started the jour­ney of out­sourc­ing when we opened our of­fice in China and sourced what they of­fered, but in­creas­ingly in the last cou­ple of years, it’s been the im­ple­men­ta­tion of our own de­sign team. So, our de­sign team trav­els a lot and stud­ies trends to cre­ate our own fore­cast based on what our mar­ket wants. We have to con­sider colours, shapes, sizes, etc. We have to trans­late those trends to our ranges, so, we are de­vel­op­ing ranges ba­si­cally on a 9-week de­sign cy­cle. We do the fore­cast­ing of main trends twice a year, so we still do a big sum­mer and win­ter trend­ing pro­gramme and then we start to in­ter­pret down to our monthly level and check/re­visit our fore­cast on a 3-monthly ba­sis and then de­velop on a 9-week rolling cy­cle and that is ba­si­cally for 2 months at a time, and so we are just rolling it through. Though, the de­sign process is done in New Zealand, fac­to­ries can also con­trib­ute. The other part is that fac­tory ac­cred­i­ta­tion is a huge en­abler to the con­cept of speed to mar­ket; im­por­tant to de­sign and strate­gi­cally work to­gether in terms of fore­cast, ca­pac­ity book­ings and own­er­ship of al­liance, so we can change quickly. We want that fac­to­ries should sup­port the elim­i­na­tion of sam­ple ap­provals for which col­lab­o­ra­tions and closer work­ing re­la­tion­ship is a must.

AO: What is the di­rec­tion of fash­ion to­day in New Zealand?

Fash­ion is chang­ing fast; it can­not be mass fash­ion. Now the big­gest trend com­ing is in­di­vid­u­al­ism, it has to be per­son­alised. As for fash­ion in New Zealand, it is very ca­sual. We are very re­laxed in our dress sense and our colour pal­ette is very dark. There is lot of black, so ev­ery sea­son there is black, but the new gen­er­a­tion now wants some pop of colour. There are al­ways stripes and of late we have be­come very big on prints as well. We are mass mar­ket re­tail, but we do not com­pro­mise on stan­dards. We want to make de­sir­able and af­ford­able prod­ucts. New Zealand is not a wealthy nation and you still need to have an at­trac­tive prod­uct at af­ford­able price. Things you buy at low cost don’t need to look ugly.

AO: What are the qual­i­ties you look for in a ven­dor?

We see if the ven­dor is eth­i­cal and whether or not they are aligned with our val­ues. If that door doesn’t open, we don’t go there. So, a buyer can­not place an or­der un­til we have made that as­sess­ment. We have our own code of con­ducts. What I want is that any cus­tomer, who buys a gar­ment in New Zealand, should feel that they have made a good choice – not only on price and qual­ity but also on the eth­i­cal point of view. We are proud of be­ing a com­pany in New Zealand that takes care of its com­mu­nity and so that ex­tends to our sup­ply chain and it’s very im­por­tant for us.

We have been do­ing CSR for last 20 years; it’s not new for us. The good thing is that fac­to­ries them­selves are now aware of en­vi­ron­ment and im­por­tance of go­ing eth­i­cal which will help in mak­ing things move faster for us. We want to build re­la­tion­ship with fac­to­ries. And, if they don’t want to work that way, it is fine; we can then po­si­tion some­where else.

(L to R) Nick Tuck – Ex­ec­u­tive GM – Di­rect Sourc­ing; Anika Passi, Coun­try Man­ager; and Ta­nia Benyon – CEO – Group Sourc­ing Sup­port & TWL/WSL Mer­chan­dise (The Ware­house)

An en­thu­si­as­tic team cel­e­brat­ing the open­ing of The Ware­house sourc­ing of­fice in New Delhi

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