NATIONAL INSTITUTE OF FASHION TECHNOLOGY, RAEBARELI

ECONOMICS - GE MANDATORY

MID TERM ASSIGNMENT

BRAND- POTHYS

MASTERS OF FASHION MANAGEMENT

Batch: 2023-2025

Submitted To:- Mr. Akash Gupta Submitted by :- Aneeta Murali

 Demand and supply
Demand is the willingness and ability of consumers to purchase a
given amount of a good or service at a given price. It is
influenced by a number of factors, including:
Income: Consumers with higher incomes tend to demand
more goods and services.
Prices of related goods and services: If the price of a
substitute good goes down, the demand for the original good
will tend to go down as well. Conversely, if the price of a
complementary good goes down, the demand for the original
good will tend to go up.
Tastes and preferences: Consumers' tastes and preferences
can change over time, which can affect the demand for
goods and services.
Expectations: Consumers' expectations about future prices
and incomes can also affect their demand.
Supply is the willingness and ability of producers to sell a given
amount of a good or service at a given price. It is influenced by a
number of factors, including:
Cost of production: The cost of producing a good or service
affects the minimum price at which producers are willing to
sell it.
Technology: Improvements in technology can reduce the cost
of producing a good or service, which can lead to an
increase in supply.
Government policies: Government policies, such as subsidies
and taxes, can also affect the supply of goods and services.
Expectations: Producers' expectations about future prices
and costs can also affect their supply.
 Law of demand
The law of demand is a fundamental principle of economics that states that, all else being equal, the quantity
demanded of a good or service will decrease as its price increases, and vice versa. This is because consumers
have a limited budget and must make choices about how to spend their money. When the price of a good or
service increases, consumers will tend to buy less of it, because they can now buy fewer units of that good or
service with the same amount of money. Conversely, when the price of a good or service decreases, consumers
will tend to buy more of it, because they can now buy more units of that good or service with the same amount of
money.

There are a number of factors that can affect the demand curve for a good or service, including:
Income: Consumers with higher incomes tend to demand more goods and services.
Prices of related goods and services: If the price of a substitute good goes down, the demand for the
original good will tend to go down as well. Conversely, if the price of a complementary good goes down, the
demand for the original good will tend to go up.
Tastes and preferences: Consumers' tastes and preferences can change over time, which can affect the
demand for goods and services.
Expectations: Consumers' expectations about future prices and incomes can also affect their demand.
Government policies: Government policies, such as taxes and subsidies, can also affect the demand for
goods and services. For example, a tax on a good will increase its price, which will lead to a decrease in
demand.
 About the brand

Pothys is a well-known and respected retail brand based in India,

particularly in the southern state of Tamil Nadu.
Pothys is renowned for its extensive collection of silk sarees,
including Kanchipuram silk sarees, which are famous for their
quality, craftsmanship, and intricate designs.
• The brand also offers a wide range of traditional and
contemporary clothing for men, women, and children.
Pothys’ product range includes silk sarees, wedding sarees,
designer sarees, salwar suits, lehengas, men’s ethnic wear, and
accessories.
• They cater to a diverse customer base, offering options for
various occasions, from weddings to daily wear.
 Products

Grocery Textiles Footwear

 Sales of Pothys
Pothys is one of the largest textile retailers in India, with over 100 stores across the
country. The company's sales have been growing steadily in recent years, and it is
estimated that Pothys generated over ₹10,000 crore in revenue in the financial
year 2022-23.

Pothys' sales are driven by a number of factors, including its strong brand
recognition, its wide range of products, and its competitive prices. The company
also offers a number of promotional offers and discounts throughout the year,
which helps to attract customers and boost sales.

Pothys' sales are particularly strong during the festive season, such as Diwali and
Pongal. During these times, people in India traditionally buy new clothes and other
items for themselves and their families. Pothys also offers a wide range of
wedding sarees and other wedding-related products, which are in high demand
during the wedding season.
In recent years, Pothys has also expanded its online sales channel. The company now sells its products through its own website and through a number
of online marketplaces. Pothys' online sales have been growing rapidly, and they now account for a significant portion of the company's overall sales.

Overall, Pothys is a strong and growing company with a healthy sales performance. The company is well-positioned to continue its growth in the
coming years, thanks to its strong brand recognition, its wide range of products, and its competitive prices.
The demand and supply of Pothys products, like any other retailer, depend on various factors:

1. Customer Demand: Pothys’ demand is influenced by customer preferences, fashion trends, and seasonal variations. For example,
demand for silk sarees might be higher during festival seasons.
2. Price: Price plays a significant role in demand. Lower prices or discounts can stimulate demand, while higher prices can limit it.
3. Competition: The presence of other clothing retailers in the same area can affect both demand and supply. Competition might force
Pothys to adjust prices and offerings.
4. Economic Factors: Economic conditions, such as income levels and consumer confidence, can impact people’s willingness to
purchase from Pothys.
5. Supply Chain: Pothys’ supply chain, including sourcing textiles and manufacturing, affects its supply. Delays in the supply chain can
lead to shortages.
6. Marketing and Promotion: Effective marketing and advertising campaigns can boost demand, while poor marketing can have the
opposite effect.
7. Government Policies: Government regulations and policies related to textiles and retail can influence both demand and supply.
8. Geographical Location: Pothys’ stores’ locations play a role in determining demand. Stores in highly populated or tourist areas may
see higher demand.
9. Cultural and Regional Factors: Cultural events and regional preferences can significantly impact the demand for specific types of
clothing.
10. Online Presence: Pothys’ online presence and e-commerce strategies can affect its supply and reach to a wider customer base.
Factors affecting law Of demand
Several factors can affect the law of demand for products sold by Pothys, influencing how much of their goods customers
are willing to purchase at different price levels. Here are key factors that can impact the demand for Pothys’ products:

1. Price of Pothys’ Products: The most direct factor is the price of Pothys’ clothing items. As prices increase or decrease, it
can influence customer demand accordingly. Lower prices often lead to higher demand, while higher prices can reduce
demand, assuming other factors remain constant.
2. Consumer Income: The income levels of Pothys’ target customers play a significant role. When consumer incomes rise,
they tend to have more purchasing power and are willing to buy more, even at higher prices. Conversely, during economic
downturns, demand may decrease.
3. Consumer Preferences: Changing fashion trends and customer preferences can impact demand. Pothys must stay
attuned to these preferences to provide products that align with what customers want.
4. Population Growth: An increase in the population, especially in regions where Pothys operates, can lead to higher
demand for clothing products. A larger customer base can drive up demand.
5. Seasonal Variations: Demand for specific clothing items can be seasonal. For example, traditional attire may be in
high demand during festive seasons, while winter clothing may see increased demand in colder months.
 Demand Factors

1. Customer Preferences: Pothys caters to a wide range of customer preferences, from traditional silk sarees to
modern clothing. Understanding and responding to changing fashion tastes is crucial for maintaining demand.
2. Seasonal Variations: India has a variety of festivals and occasions, each associated with specific types of
clothing. Pothys experiences spikes in demand during festivals like Diwali, Pongal, and weddings.
3. Demographics: The age, gender, and income levels of the customer base influence demand. Younger generations
might seek more contemporary styles, while older customers may prefer traditional attire.
4. Cultural Significance: Certain clothing items hold cultural significance. For example, silk sarees are often worn
during weddings and special ceremonies, boosting demand during such events.
5. Brand Reputation: Pothys’ long-standing reputation for quality and authenticity in traditional clothing can drive
customer loyalty and demand.
6. Competition: The actions and pricing strategies of competitors can influence demand. If rival retailers offer similar
products at lower prices or with better promotions, it can lead to reduced demand for Pothys.
7. Advertising and Promotion: Effective marketing and advertising campaigns can stimulate demand. Well-executed
promotions, discounts, and advertising can attract more customers.
8. Economic Conditions: Broader economic conditions, such as inflation rates, unemployment levels, and consumer
confidence, can impact people’s willingness to spend on clothing.
9. Government Policies: Changes in taxation, import/export regulations, or trade policies can affect the cost of
production and pricing, influencing demand.
10. Technological Advancements: Advances in e-commerce and online shopping can change how customers access and
purchase clothing, potentially affecting demand for physical store sales.
11. Socio-cultural Factors: Changing lifestyles, cultural norms, and societal shifts can impact the types of clothing people
prefer, altering demand.
12. Environmental Concerns: Increasing awareness of environmental issues can drive demand for sustainable and eco-
friendly clothing options, influencing Pothys’ product offerings.
13. Fashion Industry Influences: Collaborations with designers, participation in fashion shows, and endorsements by
celebrities can create trends and influence demand for specific clothing lines.
14. Supply Chain Disruptions: Any disruptions in Pothys’ supply chain, such as delays in sourcing textiles or manufacturing,
can lead to shortages and affect demand.
15. Health and Safety Concerns: Events like a pandemic can significantly impact consumer behavior, leading to changes
in demand for clothing items.
 Supply Factors
1. Sourcing of Raw Materials: Pothys relies on the supply of high-quality textiles, especially silk, for its products. Variability
in the availability and cost of these materials can impact supply.
2. Manufacturing Capacity: The production capacity of Pothys’ manufacturing units affects supply. Increasing capacity
can lead to higher supply levels.
3. Inventory Management: Efficient inventory management is crucial to balancing supply with demand. Excess inventory
can lead to storage costs, while low inventory can result in stock-outs.
4. Distribution Network: The efficiency of Pothys’ distribution network, including the number and location of stores,
warehouses, and logistics partners, influences supply.
5. Quality Control: Maintaining product quality is vital. Supply can be constrained if there are issues in the production
process that need to be addressed.
6. Regulatory Compliance: Compliance with textile and retail regulations, including taxation and import/export policies,
can affect the supply chain.
7. Technology and Innovation: Adopting modern technology and innovation in manufacturing and retail operations can
increase supply efficiency.
8. Market Trends: Staying attuned to market trends and customer feedback allows Pothys to adjust its supply chain
accordingly.
9. E-commerce: With the growth of e-commerce, Pothys’ online supply chain management is essential to meet the
demands of online shoppers.
 Pothys competitors and their strategies
Pothys faced competition from several other textile and clothing retailers, especially in
the region of Tamil Nadu, India. These competitors employed various strategies to
attract customers and maintain their market presence. Keep in mind that the
competitive landscape may have evolved since then, but here are some of the
competitors and their strategies:

1. Nalli Silks:
• Heritage and Tradition: Nalli Silks, like Pothys, has a rich heritage and tradition in silk
sarees.
• Diverse Collection: They offer a wide range of silk sarees and traditional clothing.
• Customer Loyalty: Nalli has a strong base of loyal customers who appreciate their
quality and craftsmanship.
2. RMKV Silks:
• Innovation: RMKV is known for innovations in silk saree design, including lightweight
silk sarees.
• Customer Engagement: They engage with customers through promotions and events.
• Online Presence: RMKV has a strong online presence to reach a wider customer
base.
3. Saravana Stores:
• Affordability: Saravana Stores is known for its competitive pricing and affordability.
• Variety: They offer a vast range of products beyond clothing, including electronics and
household items.
• Mass Appeal: Their stores cater to a wide demographic, including budget-conscious
shoppers.
4. The Chennai Silks:
• Expanding Footprint: The Chennai Silks has been expanding its presence in South India.
• Customer Engagement: They engage customers through loyalty programs and events.
• Product Range: Besides sarees, they offer various clothing and accessories.
5. Kumaran Silks:
• Focus on Quality: Kumaran Silks emphasizes the quality and authenticity of its silk
sarees.
• Online Sales: They have an active online platform to reach customers worldwide.
• Exclusive Designs: Kumaran Silks creates exclusive designs to differentiate itself.

Competitive strategies among these retailers often include pricing, product variety,
customer service, and marketing efforts. Additionally, many have recognized the
importance of an online presence and e-commerce to cater to changing consumer
preferences, especially after the COVID-19 pandemic.
 Financial report of Pothys

Revenue / turnover of POTHYS PRIVATE LIMITED is Over INR 500 cr

Net worth of the company has increased by 18.45 %
EBITDA of the company has increased by 39.44 %
Total assets of the company has increased by 24.74 %
Liabilities of the company has increased by 75.16 %

Operating Revenue Fixed Assets

Over INR 500 cr 7.42 %
EBITDA Current Assets
39.44 % 48.13 %
Networth Current Liabilities
18.45 % 75.16 %
Debt/Equity Ratio Trade Receivables
185.64 %
0.59
Trade Payables
Return on Equity
75.36 %
17.42 %
Current Ratio
Total Assets
1.03
24.74 %
 Demand and supply
curve of pothys sales

Orginal
after introduction of new products
Present day
Reference
https://www.google.co.in/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&ved=2ahUKEwjroJSmh-
eBAxXYT2wGHfWODtYQFnoECAoQAQ&url=https%3A%2F%2Fwww.pothys.com%2F&usg=AOvVaw3aBm_yKpda6MMbp5qI3
T-H&opi=89978449

https://www.google.co.in/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&ved=2ahUKEwjroJSmh-
eBAxXYT2wGHfWODtYQFnoECAoQAQ&url=https%3A%2F%2Fwww.pothys.com%2F&usg=AOvVaw3aBm_yKpda6MMbp5qI3
T-H&opi=89978449

https://www.google.co.in/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&ved=2ahUKEwjroJSmh-
eBAxXYT2wGHfWODtYQFnoECAoQAQ&url=https%3A%2F%2Fwww.pothys.com%2F&usg=AOvVaw3aBm_yKpda6MMbp5qI3
T-H&opi=89978449

https://www.scribd.com/doc/211458906/A-STUDY-ON-CONSUMER-PREFERENCE-WITH-SPECIAL-REFERENCE-TO-
POTHYS-AT-TIRUNELVELI