Evolution of Trends in Fashion Industry

A Dissertation Report submitted to

ISME, Bangalore

In partial fulfilment of the requirements

For the award of the

POST GRADUATE DIPLOMA IN MANAGEMENT

Submitted by

Kirti Baid

(2011112)

Under the guidance of

Prof Raja Sankaran (Research and Marketing Faculty)

International School of Management Excellence

Sy. No. 88, Chembanahalli, Near Dommasandra Circle,

Sarjapur Road,

Bangalore-562125

June 2020
 Evolution of trends in fashion industry
Introduction:
The Fashion plot in India is popular for its cultural heritage, style, taste, and colourfulness.
Fashion brings out beauty which has been present there in India for hundreds of decades. It’s
not only comfortable, has a huge amount of worldly experience and knowledge of fashion, but
it’s also concerned with the appreciation of beauty and also evolved with time. The fashion
scenario of India is a combination of the fast-changing world, culture, and people’s sense of
fashion. From western to ethnic wear, from saree to jeans, the fashion status of India has gone
through a huge transformation and has been advanced by hundreds and thousands of rich
traditions and cultures behind it.
The textile industry in India is among the largest in India’s capital goods sectors, according to
(IBEF). In the whole world, India is the second-largest exporter of textiles. In addition to this,
rising income levels and favourable conditions are believed to be key growth drivers of the
textile industries and apparel sectors in the coming years.
India’s fashion industry covers an ample range of clothing from bride and groom collections
designed especially for wedding ceremonies to casual wear. Traditional techniques of the
Indians such as embroideries like crewl, chikhan, and zardosi have internationally made their
way portraying Indo-western clothes.

Literature Review:
* According to Eric Wilson from beauty and elegance blogs says that what defines the style
industry is essential. In simplest terms, the style industry might be described as the business of
creating clothes, but that might omit the important distinction between fashion and apparel.
Garments are functional clothing, humanity’s basic needs, but fashion incorporates its own
influence of favour, individual taste, and cultural evolution.
* According to Brydges, Taylor, Hracs, Brain J. : Debating about the impact of digitalization,
democratization, and diffusion within the global fashion industry” They mentioned that the
lens through which we will explore for assembly, selection, and consumption of products,
services, and experiences.
* According to Kristen Grauman from his topic of presentation “Computer vision for fashion:
from individuals’ recommendations to worldwide trends” He quoted that, the style domain
may be a lodestone for computer vision.

Objectives of study:
This Industry research topic is related to “Evolution of trends in Fashion Industry” and the
objectives of research on this topic is to:
* Know about Fashion, both as a business as well as culture wise domain
* Know about its importance amongst the consumer
* Witness the evolving trends of fashion from time to time and place to place
* Witness how the entries of foreign market to India effected the fashion scenario
* Understand Fashion industry significance in terms of choosing it as a career
* Know the history about how fashion was then and how it is now
* How much role does creativity play in this industry?
* Global trends that were welcomed in India and vice versa

Research Methodology:
As per research on my study I have chosen non empirical method, wherein I will not opt for
quantitative data or any sorts numerical data and would rather go for non-numerical data such
as observations and interviews which will be collated from various authentic sites and also
real time information from a famous Indian company named Aditya Birla Fashion brand
which will be provided by my friend who works there to get better insight of India’s fashion
status. It will also have a touch of descriptive research wherein certain characteristics of the
topic will be studied and some questions will be answered relating to “what” they actually are
rather than “why” it’s is.

The expected outcome of the study:

* At the end of the dissertation, we shall learn about the fashion industry as well as a whole.
* Understand about the different perspectives a common consumer as well as a professional
blogger and designers (thoughts).
* Learn how cultures can influence fashion
* Can fashion be a great career/opportunity for an individual to pursue?
* Indian as well as foreign perspectives into recent trends in fashion.
* Companies that have evolved as great fashion providers.
* Introduction of technology and its impact on fashion.
* Influencers (celebrity/digital) impact on the revenue earning perspective of fashion.

References and Bibliography:

Main website: https://www.iiad.edu.in/the-circle/evolution-fashion-industry-india/
1. Fashion++: Minimal Edits for Outfit Improvement. W-L. Hsiao, I. Katsman, C-Y.
Wu, D. Parikh, K. Grauman. In Proceedings of the International Conference on
Computer Vision (ICCV), Seoul, Korea, Nov 2019.
2. Thinking Outside the Pool: Active Training Image Creation for Relative Attributes.
A. Yu and K. Grauman. In Proceedings of the IEEE Conference on Computer Vision
and Pattern Recognition (CVPR), Long Beach, CA, June 2019.
3. Creating Capsule Wardrobes from Fashion Images. W-L. Hsiao and K. Grauman. In
Proceedings of IEEE Conference on Computer Vision and Pattern Recognition
(CVPR), Salt Lake City, June 2018.
4. Pratt, A, Borrione, P, Lavanga, M, & D' Ovidio, M. (2012). International change and
technological evolution in the fashion industry. In Mauro Agnoletti, Andrea
Carandini, Walter Santagata (eds), Essays and Researches. International Biennial of
Cultural and Environmental Heritage / Studi e ricerche. Biennale internazionale dei
beni culturali ed ambientali. Florence/Firenze 2012 (pp. 359–394). Retrieved from
http://hdl.handle.net/1765/51737

Company choosen: Aditya Birla Fashion Group

Company’s History (in general):
 Aditya Birla Management Corporation Pvt. Ltd, is an Indian Multinational
Conglomerate, headquartered in Worli, Maharashtra, India.
• It was founded on 1857, by Seth Shiv Narayan Birla
• It is one of India’s largest corporate houses and first truly multinational corporation
operating in 26 countries.
• The company is majorly engaged in the business of non-ferrous, telecom, IT services,
financial services, insulators, and BPO.
• The company’s various businesses include textile, fashion, telecom and financial
services.

Fig: Aditya Birla Group short description

Fig: Various businesses of Aditya Birla with description of service provided along with
net worth (In picture: Kumar Mangalam, Chairman of Aditya Birla Group: $65 billion
dream business today)
Company’s History (with regard to Aditya Birla Fashion)

• Their main business revolves around textile and ABG is the world’s largest producer
of Viscose staple fiber and operates from multiple countries.
• Madura Garments was established in 1988, acquired by the Aditya Birla Group in
1999 and was re-christened Madura Fashion & Lifestyle in 2010.
 Year Activity
2008 ABFRL went international, striking a deal with global luxury brand Ted
Baker and also signed a MOU with Forever 21 for Indian Business
2013 Aditya Birla Nuvo Ltd. took over Pantaloons.
2015 Consolidation of ABNL’s Mudura Fashion and Retail Ltd and ABNL’s
subsidiaries-Pantaloons Fashion and Retail Ltd.
2017 It brought Simon Carter to India and entered into a strategic alliance with
American Eagle.
2018 It entered into a store license and distribution agreement with Ralph Lauren
Asia Pacific Ltd.
2019 Launched a chain of large format value fashion stores, named Style Up.
2020 Walmart made strategic partnership with Aditya Birla fashion and retail by
backing e-commerce major Flipkart. Flipkart acquired 7.8% stake in
ABFRL
2021 ABFRL announced a strategic partnership with India’s largest design brand
“Sabyasachi” henceforth acquiring 51% stake.
2021 Adding to the above point, it also acquired 34% stake in Tarun Tahiliani’s
luxury business.
Fig: Chart depicting activities of ABFRL (Aditya Birla Fashion and Retail Ltd) from past till
current as part of company’s activity history.
MICRO and MACRO environmental factors of Fashion Industry’s trends and changes:
MICRO:

 Consumer Behavior: The factors involving here will be the norms, lifestyle,
demographic and cultural practices of the target consumers. The study of cultural
norms and lifestyle helps tremendously in guiding the production of fashion products.
 Employees: Employees are the most significant microenvironmental factor that
greatly affects the progress of an organisation. The employees needs to be updated
with all sorts of fashion trends and changes in consumer choices. The company should
establish employee-friendly strategies to promote devotion and loyalty among their
workers. Only then could they work towards organizational goals and achieve and
maintain their status in the fashion and business industries.
 Distributors: Manufacturers have to rely on distributors and material suppliers
to distribute and sell their products in the market. As a result, a good relationship
between supply chain management and distributors is necessary. This will help the
company increasing its sales and its footprint in the market.

 Stakeholders and Shareholders: Stakeholders and shareholders are the

main investors in the organization and are responsible for advising strategies for a
company to grow up. Involving shareholders in decision-making is important as
policies set by them will greatly influence how the company operates and
affects profitability. Our company should involve stakeholders and shareholders in
order to develop a better relationship.
MACRO:

 Technology: Technology refers to the means and resource to encounter the

company’s demand and production. Example, If an organization is dealing in
Plastic products, it should have access to enough of the resources to meet
customers’ demands.

 Economic Factors

Economic fluctuations can also impact the progress of a business.  Looking again to the
fashion industry, stable and good economic conditions allow consumers to spend more
disposable income on luxury goods. However, inflation or a recession can negatively
affect the sales of these fashion products. So, it must be ensured that the product or
brand’s price should be lower to compete with the challenges of the economics within a
respective country.

 Media and the General Public

As observed by media and the general public, the appearance of the enterprise can

greatly affect ongoing business and employee behavior. Michael Kors makes a strong
relationship with different media cells because they are capable of representing the brand
in both good and bad ways.  Understanding how media can influence the opinions of
consumers is vital to every aspect of the production chain.

PESTEL analysis of Aditya Birla fashion and retail:

• Political Factor: In the year 2011 and 2012, the tax rates had declined and eventually
impacted the organization’s profits, which ultimately led to charitable activities in
Canada in order to improve the business image.
• Economical Factor: Due to the international monetary crises in the year 2008 and
2009, the relative development of Gross Domestic Product (GDP) rate in Canada had
decreased in the year 2012 form the year 2011. 
• Social Factor: As it has been decided that the Pestel Analysis of Aditya Birla Group:
Redesigning To Become A Fortune 500 Company Case Solution will now target the
elementary and high school children to increase the charitable activities and donations
in Toronto
• Technological Factor: Due to the technological development in Canada, the little and
corporate organizations will produce more in less expense which eventually lead
towards the cost saving leading to more profits and margins which might lead towards
the more involvement in the charitable activities.
• PEST analysis/strategy: (i) Franchise Incentives, (ii) Loyalty Card, (iii) Schools
PESTEL analysis of “recent trends in fashion industry”
• Political factors: Fashion icons in the White House: The government has the ability to
encourage companies to buy fabrics locally, especially if the taxation on imports from
 other countries increases. Many more people are buying from companies who create
their clothing in the United States, as opposed to those who ship their fabrics to be
sewn overseas. Additionally, certain groups like PETA boycott against companies
who use real animal furs and skins.
• Economic factors: a new way to stay fashionable without breaking the bank: The
economy is still recovering from the impact of the 2008 recession, but more people
are finding extra money to put towards fashion and accessories. People who are low-
income or live in an area with a high unemployment rate, need their income to go to
survival staples like food and rent.
• Social factors: the impact of musicians and everyday life: Music has always had a
massive impact on fashion. Music videos are where musicians show off the clothes
their viewers will want to buy ASAP. It’s common to mention brands in songs.
“Anaconda” by Nicki Minaj and “Fashion” sung by Lady GaGa both mention
expensive brand names in the lyrics. It’s usually just a shameless plug that fans will
eat up.
• Technology: anyone can be a fashion designer: Online shopping is a dream for so
many people. Instead of visiting busy shops and manually looking for clothes
you might like, you can surf through an online category, pick the size you want, and
have it delivered in days.
• Legal factors: companies still having their clothes sewn in foreign countries to cut
costs: The fashion industry must follow similar legal rules and regulations like any
other business. To stay legal, they follow tax restrictions, export restrictions, and
inflation costs. 
• Environmental factors: fashion isn’t safe for the planet: Yes, fashion has an impact on
the environment, and it’s not a good one. Many clothes are made from cotton, but
first, it must be picked then shipped all over to be sewn as denim. Chemicals easily
make their way into the cotton, meaning those jeans you’re wearing could be soaked
in hazardous compounds. Not to mention how cars, jets, trains, and other methods of
transportation releases gases and smoke into the environment. It’s a massive amount
just to get the jeans from the factory to the store. Then the clothes are typically put
into plastic bags that are later tossed into landfills.
Porter’s 5 forces:

Porter’s 5 force (Recent trends in fashion industry):

 Buyer’s Power: While clothes shoppers are typically individuals with little to
none direct bargaining power (as compared to huge companies, buying in bulk, who
might be the main clients in other industries), they have many alternative locations to
shop for apparel and little incentive to stay with one particular company, giving them
plenty of indirect bargaining power.
 Supplier Power: In the fashion retail industry, supplier power is a relatively small
and insignificant force. Most apparel companies source their products from third
world manufacturers who receive just fractions of the profit. Suppliers have little
control over the fashion industry as, unfortunately, they are dispensable and can
always be swapped out.
 Competitive Rivalry: The fashion industry is an interesting one when it comes to
analyzing through the intensity of competitive rivalry. There are large numbers of
retailers who sell very similar products, but there’s also the concept of brands, which
allow some companies to sell apparel for ridiculous rates. Nowadays there is little
innovation in this space, so the market is quickly becoming saturated with very
similar products.
 Threat of New Entries: As mentioned previously, there is little that is unique to bring
to the table in this industry, so this force is also somewhat small. However, new
entries might find unique ways to popularize their own products (which might not
even be particularly special), and as such build novel brands — perhaps through
clever use of social media.

 Threat of Substitution: This Five Forces analysis has shown that while there are few
threats and little supplier bargaining power, it is not good that the market is
effectively nearing saturation. Buyers have large amounts of indirect power to bargain
with — i.e, plenty of choices — and lots of competitors make it hard to sustain a
place in the market.

Porter’s 5 force (Aditya Birla fashion and retail)

 COMPETITIVE RIVALRY
The fashion industry is becoming highly competitive with 53 players operating in
the industry.
Companies are competing on price and also using low price and high price return
strategies for customers to lure them.

 THREATS OF NEW ENTRANTS

Other new fashion companies are also in the industry
The overall threat is medium given that is subject to license and regulations

 SUBSTITUTE PRODUCTS
The similarity in services makes switchover a potent threat

 BARGAINING POWER OF SUPPLIERS

Suppliers being the distributer or agents have high bargaining power because they
have a customer database and can influence customers in making choices.

 BARGAINING POWER OF BUYERS

The bargaining power of customers.

SWOT Analysis of Fashion Industry:

Strengths:
 Demand driven industry
 Strong presence in local market
 Cheap labor availability.
 Situated at ideal location.
 Most of the setup are self employed and have similar management structure.
Weakness:
 Obsolete technology machinery and equipment used for manufacturing
 Availability of raw material and inconsistent raw material prices.
 Unskilled labor (only 1 percent worker have certificate\ diploma from technical training
institutions)
 Absence of research and development culture.
 Lack of synergies between government support institution and practical market.
Strengths:
 Demand driven industry
 Strong presence in local market
 Cheap labor availability.
 Situated at ideal location.
 Most of the setup are self employed and have similar management structure.
Weakness:
 Obsolete technology machinery and equipment used for manufacturing
 Availability of raw material and inconsistent raw material prices.
 Unskilled labor (only 1 percent worker have certificate\ diploma from technical
training institutions)
 Absence of research and development culture.
 Lack of synergies between government support institution and practical market.
SOWT analysis of Aditya Birla Fashion and Retail:

Strengths:

 Company trying to reduce debt

 Strong cash generating ability from core business - Improving Cash Flow
from operation for last 2 years

 Company with Zero Promoter Pledge

 Strong Momentum: Price above short, medium and long term moving
averages.

Weakness:

 Red Flag: High Interest Payments Compared to Earnings

 MFs decreased their shareholding last quarter

 Decline in Net Profit (QoQ)

 Companies with High Debt

 Promoter decreasing their shareholding

 Declining Net Cash Flow: Companies not able to generate net cash

Opportunity:

 Best Bargains Screener: Above line growth, Below line valuations 258.5%
returns for Nifty 500 over 6.4 years

 Insiders bought stocks

Business Model of Aditya Birla Fashion:

With revenue of Rs. 5,249 cr. and spanning a retail space of 8.4 million sq.ft. (as on March
31, 2021), Aditya Birla Fashion and Retail Limited (ABFRL) is India’s first billion-dollar
pure-play fashion powerhouse with an elegant bouquet of leading fashion brands and retail
formats.

ABFRL emerged after the consolidation of the branded apparel businesses of Aditya Birla
Group comprising ABNL's Madura Fashion division and ABNL's subsidiaries — Pantaloons
Fashion and Retail (PFRL) and Madura Fashion & Lifestyle (MFL) in May 2015. Post the
consolidation, PFRL was renamed Aditya Birla Fashion and Retail Ltd

ABFRL brings together the learnings and businesses of two renowned Indian fashion icons,
Madura Fashion & Lifestyle and Pantaloons creating a synergistic core that will act as the
nucleus of the future fashion businesses of the Aditya Birla Group.

As a fashion conglomerate, ABFRL has a strong network of 3,212 brand stores across the
country. It is present across 31,000+ multi-brand outlets and 6,800+ point of sales in
department stores across India.

It has a repertoire of leading brands such as Louis Philippe, Van Heusen, Allen Solly and
Peter England established for over 25 years. Pantaloons is one of India's largest fast fashion
store brand.

The Company also holds exclusive online and offline rights to the India network of
California-based fast fashion brand Forever 21. The International Brands portfolio includes -
The Collective, India's largest multi-brand retailer of international brands, Simon Carter and
select mono-brands such as American Eagle, Ralph Lauren, Hackett London, Ted Baker and
Fred Perry.

Van Heusen Innerwear, Athleisure and Active wear is establishing itself as India's most
innovative and fashionable brand. The Company’s foray into branded ethnic wear business
includes Jaypore and strategic partnerships with Designers ‘Shantanu & Nikhil’, ‘Tarun
Tahiliani’ and ‘Sabyasachi.

Marketing strategies used:

India’s leading fashion and lifestyle brand Aditya Birla Fashion and Retail Ltd (ABFRL) will
adopt 'My Collection', an industry solution from 3D experience platform Dassault Systèmes
to market its fashion collections and increase consumer satisfaction, the company said in a
statement.

"Aditya Birla Fashion and Retail is the latest example of how the largest fashion company in
India is transforming its business by connecting its people, information and ideas with the 3D
experience platform. Dassault Systèmes offers comprehensive, ready-to-deploy functionality
for multi-category management in one environment with scalability to support growth.
Brands and retailers can improve operational efficiency and reduce cost of goods by up to 30
percent," said Chris Colyer, vice president, Consumer Goods and Retail Industry, Dassault
Systems.

ABFRL retails four of India’s top fashion brands including Louis Philippe, Van Heusen,
Allen Solly and Peter England.

Competition analysis of Aditya Birla Fashions (weighing various criterias)

Competitor analysis of fashion industry:

Product line: