I History

A

At the time, the block-printing industry in Jaipur was still “very traditional”, comprising the traditional block-printing families of the ‘chippa’ caste, who lived and worked in their homes in the villages. The main block-printing clusters around Jaipur were Sanganer, Bagru and Jaota. Tourism and the widespread exports of handicrafts had yet to play the major role in the local economy as it does today and almost the entire production of block-printed textiles was for sale within Rajasthan. There were also a few fabric shops in Jaipur that converted the traditional printed fabrics into ‘bads’ and ‘lehengas’ – the traditional clothing worn by the Rajasthani women. These were bought by women from the surrounding villages. However, the traditional rural markets were decreasing due to the increasing adoption of mill-made fabric by the rural women for their clothing needs. At this time, there were only two businesses in Jaipur that were targeting the (negligible) urban middle and upper class market in Jaipur.

Faith and her husband John started their work directly with the block-printers by offering to invest in the cloth, i e, they would buy the cloth directly from the traders, with the block-printers then having to invest only their “skills, colours and blocks”. At that time, the traditional craftworkers were caught in a vicious cycle due to their purchase of raw material on credit and falling local sales. The craftworkers used to purchase cloth on credit from local traders. The printing and processing of the fabric took approximately a week and if the block-printers could not sell the cloth at the local Saturday market, then they were unable to repay the cloth traders, who then charged them exploitative rates of interest. After doing smallscale printing in an informal way during 1968 and 1969, Faith and John decided to take it up as a full-time business from which they would earn their livelihoods and registered Anokhi formally in 1970.

II Growth of Anokhi

In its beginning years Anokhi focused on creating block-printed fabrics, which

Economic and Political Weekly August 5, 2006

they stitched into garments and exported Figure: Production Process

to UK. At the time, they focused only on exports as there was “...no market in India for our products at that time”. In 1971, they took their first collection of traditional block-printed fabrics to UK. They managed to tie up with a local entrepreneur who started a boutique shop, Monsoon, selling block-printed fabrics. For the first three years, Anokhi was supplying only to this one store in the UK. Its second buyer was an Australian company, Handicrafts of Asia, which Anokhi was introduced to by John Bissell, the founder of Fabindia.

Finding a market niche and avoiding the ‘fashion trap’: From the very beginning, Anokhi’s products were pitched at the higher-end niche retail market in the UK. Initially, Anokhi’s product range was limited to garments, and the company did not diversify into home furnishing until 1979 when, partly due to other firms emulating Anokhi, the English market was saturated with block-printed fabrics and garments. This brought a new set of pressures to bear on Anokhi given that it was positioning its product as an exclusive product.

Anokhi dealt with the “fashion-trap” by diversifying their product range. Rather than change the craft genres they were working with, they extended their product range to include home-furnishing items and accessories.

Thus, the basic pillars of Anokhi’s success were already in place within the first five years: the basic business model of investing in cloth; firming their production-base by helping the block-printers to improve quality and diversify from traditional designs; positioning its product as a “high-end” one; focus on product quality; and constant design innovation.

We had to be leaders instead of chasing

afterwards, and we wanted to ride the retail

revolution wave early, be frontline.

– Pritam Singh, joint managing director.

From 1969 to 1985, Anokhi was purely an export company because there was “…no domestic market”. The initial focus of Anokhi on export markets and the consequent exposure to the rigours of competing in international markets was an important catalyst in the future success of the company. From the start, Anokhi insisted on selling products under their own brand name, even in export markets. This helped the company establish a good profile in the market. Expansion into the domestic market: In 1981, the company started its first domestic retail store in Jaipur, where it started selling export surpluses and products with minor defects. In 1988, Anokhi opened its second domestic retail outlet in the

Orders Orders placed by export buyers and retail outlets

Block Making

Fabric Sourcing

Master blocks made –

Grey fabric sourced from

fabric traders

Random Inspections

Printing Fabric dyed and printed at printing units

Complete Inspection

Cutting and Stitching Fabric cut and shaped into final products source copies directly from block-maker

Complete Inspection Random Inspections Shipping Finished products shipped

Laundry Finished products laundered and packed

Source: Kavita Madhok.

Santushti complex in Delhi and many more followed in the big metros and cities. Initially, Anokhi was reluctant to expand the domestic business due to the degree and nature of investment required. Exports are desirable for a company because of the short investment cycles and the lower risk in production due to committed orders. In comparison, retailing requires an initial investment into product stock and the uncertainty of whether the product will actually sell or not.

Anokhi cites three main reasons why it decided to expand into domestic retailing despite the higher investment and risks involved: the growth of domestic Indian markets, the volatility of export sales and the ability to give a firm work commitment to the craftworkers they worked with. It was not until the late 1990s that Anokhi had completed the transition from being primarily an exporter to also being a domestic retailer. After this transition, Anokhi found that the products it produced had to be geared more towards the local market, which required a significant change in design focus. Interestingly, the company found that it was able to sell its higher value “crafted” products more successfully in India than through export sales. Anokhi attributes this to the greater awareness of craft traditions that are prevalent in India than in outside export markets. Recognising that its products are still targeted at a niche retail market in India, Anokhi has started making efforts to reach a more mainstream market. To appeal to different customer demographics, it seeks to design products, especially garments, in different shapes and sizes.

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with increases and decreases in such sales over the years, whereas domestic sales have a much smoother growth curve. As of 2004, the total sales revenue of Anokhi was Rs 17 crore of which Rs 6.94 crore (41 per cent) were from export sales and Rs 10.1 crore (59 per cent) were from domestic retail sales.

The expansion into the domestic market has given Anokhi more control over its products and operations as the company is now less dependent upon volatile export sales. However, the company credits exports and the resulting exposure to global competition with helping it to develop efficient production systems and in instituting high quality standards. The rapid growth in sales necessitated changes to be made in the structure and logistical operations of the firm in order to maintain quality and to increase production capacity.

III Operations and Logistics

In 1995, the founders of Anokhi started withdrawing from day-to-day involvement and management in the company. Today, the organisational structure is large and complex, with production, purchase, printing, design, export and retailing sections. Other structural changes made due to rapid sales growth include developing in-house capacity in the earlier outsourced functions of stitching and laundry; adding an in-house product sampling facility with a printing unit and an embroidery unit; creating and expanding a dedicated quality control department; and moving to a new, larger production facility on the outskirts of Jaipur in 1997. The size of the in-house tailoring department has grown rapidly with the number of tailors employed by Anokhi increasing from 100 to 300 over the past five years. Printing is still outsourced to block-printed units located in Sanganer and Bagru. The in-house quality control department is responsible for inspecting products at various stages of production. This department has grown rapidly and now employs approximately 100 people. Production logistics and focus on quality control: Renting retail space has made the process of putting product samples into production and the logistics of getting the products to the stores particularly crucial to Anokhi’s financial success. Since rents for expensive retail space represent a fixed cost every month, there is a pressure on the company to ensure that product shelves are filled with the appropriate products on a timely basis and that the sales in each shop justify the costs of renting that shop.

Once the orders are placed by export buyers and retail “buyers”, the first step in the process is sourcing the appropriate fabric for the product. Anokhi sources the fabric mainly from traders, but they also source handloom fabrics directly from Craft Support Groups including Dastkar Andhra and Rehwa. For non-handloom fabrics, there is a specialised trader in Delhi from whom Anokhi only sources new fabrics and blends for product sampling.

Anokhi has built sustained relationships with its handloom suppliers. It began working with handloom support NGOs “…because they were already up to a certain level…” and were able to ensure the timely delivery of handloom fabrics that met quality standards in exchange for firm work commitments. With most of the handloom supplier organisations, their production is tailor-made to Anokhi’s requirements.

However, Anokhi does admit that working with handlooms presents its own unique challenges due to the longer production cycles for the fabric: “Because it is a customised product, and being a ruralbased craft deliveries are an issue. Timing of delivery is very important to us since we are trying to marry the fabric with our print collection – and it stays in the shop for only a month. If the fabric doesn’t come in time, then the products are not ready in time – and later on those colours are not relevant anymore since we have changed the collection in the stores.” To overcome this, the company often builds in a two to three month buffer in the deadline given to the handloom producers to account for any potential delays in production.

Once the fabric has been inspected, it is sent out to be dyed and printed at Anokhi’s various supplier printing units. Anokhi has consciously sought to build long-term relationships with these units since it views this as a critical step in maintaining quality standards. The company has been working with many of these units for over a decade and has helped them grow by providing low-interest loans: “We have encouraged our printers to expand their operations so that we can deal with fairly big units and not have to work with hundreds of small printing units. As a result we work with about 10 printing units.” The 10 printing units together process approximately 1,00,000 metres of block-printed fabrics each month. Anokhi employs field supervisors who visit the production units and conduct regular inspections

Om Singh, the owner of one of these units, says that the provision of investment credit by Anokhi has been critical in enabling him to grow and expand operations since he was unable to get sufficient credit from local banks. Singh also says that he finds it more profitable to work for Anokhi rather than other firms because of the commitment to year-round work and their policy of making payments immediately upon delivery. Other exporters and trade intermediaries in the region often delay payments, thereby squeezing the margins of the block-printing units who have to pay interest to their own raw material suppliers. Kavita Madhok reiterates that Anokhi is committed to paying its suppliers promptly: “Our payments are always on time. When they work with others, their money is blocked up for six months to a year. Then they get into trouble because they get charged by their suppliers (of colour, etc) at a very high rate of interest. At Anokhi, any time the payment is delayed by even a day, they can come straight to my office, and I will make sure that the payment is released immediately even if we have to take short-term credit from the bank.”

The main challenge Anokhi faces in its production cycle is the need to balance export and domestic production. Export production is seasonal and concentrated in a three-month period since export buyers only buy for the summer collection in international markets. During those three months, the entire production capacity of Anokhi and the printing units are reserved for export production. Due to this production constraint, the production for the domestic retail outlets are “pre-produced” in advance and kept as stocks.

IV Focus on Design

– Rachel Bracken Singh, design director Anokhi has continued to build on its early focus on design and now, a major focus of the company is on the process of creating new designs and putting them into production and into the retail stores in a timely fashion. By 1980, Anokhi already had a design department, where in addition to Faith, visiting designers from the National Institute of Design and from various international design schools served as apprentices and gave design input into Anokhi’s products. The entire process of putting together a collection takes approximately six months. Since a significant portion of Anokhi’s sales are to a regular clientele,

the company changes their products constantly to encourage their clientele to return

Economic and Political Weekly August 5, 2006 to the retail stores on a regular basis. To achieve this constant turnover of designs, the design department works on collections a full year in advance. Anokhi has two seasonal collections – summer and winter. Each collection, in turn, consists of a different range of designs – called a “story”

– for each month. This calls for rapid turnover of designs

Anokhi creates only one collection for both the export and the domestic market from which both external export buyers and internal buyers representing the retail operations choose products.

Even though the domestic retail outlets are owned by Anokhi, they still act as “buyers” and choose what products to buy from the design collection for the stores. Samples of the new design collection are displayed in the buyers room and a team of people evaluates the viability of the designs using various criteria. “Everybody brings their own expertise in evaluating the viability of the design. Is it possible in production? Is it something that we can merchandise and sell as a product?”

In the entire design process, customer feedback from the stores is taken into account. However, Rachel stresses that this is mainly used to alter sizes and shapes and not block-print designs themselves: “We are not led by the fashion industry. We have our own kind of look. But we also make an effort – since we are focusing a lot on retail now – to understand what the customer is appreciating about what we do. We embrace colours and shapes that the customers really like and try and repeat those. However, we also focus on creating a full range rather than repeating colours and products that are getting good customer response.” Anokhi also differentiates their products from other blockprints by using a lot of natural dyes.

What Anokhi has done from the beginning is to pioneer contemporary hand-blockprinting. People come to us for innovative crafts – we like to keep the traditional techniques and motifs alive, but incorporate them into new and innovative designs. For the sake of fashion, we never forego on the print collection.

– Rachel Bracken Singh

This case study has sought to highlight the main features that have led to the successful growth of Anokhi from its inception as a small export business to its current operations encompassing a complex production system and a chain of retail stores across India. The business acumen of the founders, their ability to network in export markets, their focus on instituting systems and processes, and their design skills have played a key role in the success of Anokhi. However, the following are the key characteristics of the company that have contributed to its success:

their own brand name, even in export markets.

(4) Control over operations and strategic direction due to its retail operations:

Building its own retail interface with customers has been a critical step in giving the company greater control over its operations and more freedom to innovate. More importantly, it has helped the company in grappling with a problem that is faced by all craft-support organisations: how to guarantee a year-round employment for craftworkers. The lesser volatility of domestic retail markets relative to export markets has helped the company to increase the number of craftworkers who produce for the company on a sustainable, year-round basis. The experience of Anokhi also suggests that controlling the interface with the end customer is critical in having greater control on the production of crafts, i e, the end retailer has a greater degree of control over what crafts are produced and the timing of such production.

(5) Commitment to the craft: Finally, the key factor underlying all the others is Anokhi’s continuing commitment to the craft of block-prints. Although the company also now sells embroidered products, it focuses on building its core strength in the craft of block-printing. This commitment has helped Anokhi to build a favourable profile as a craft-based company and to generate a good image with both customers and craftspeople.

EPW

Email: adarshkumar@aiacaonline.org

Economic and Political Weekly August 5, 2006