'US fashion brands don’t want to own inventory'

NEW DELHI: From starting as an online fashion brand to becoming one of the most successful PPE kit makers for global markets during the pandemic, Noida-based apparel manufacturing company for wholesale buying, Hula Global is set to expand overseas. Founded in December 2018 by Karan Bose, the startup operates on the fairly new yet innovative ‘modular manufacturing’ with which it has eliminated intermediaries to help brands pay less and factories earn more in the process.Bose talks to TOI about the new trends in his sector and his expansion plans. Excerpts:
What are the emerging trends in your sector during the pandemic?
We are seeing a strong trend from US fashion brands on not owning the inventory. They now prefer that the supplier takes the inventory risks with them and they are willing to share the rewards. While pricing still plays an important part, it is now more a collaborative effort rather than a zero-sum game. The only exception to this are discount retailers.
What is your business model?
Our business model has evolved over a period of time. We started as an online fashion brand in 2014 and we soon realized it was a huge challenge to receive quality products on time. The cost overruns for suppliers were also very high. Everybody was unhappy. Brands lost time and received cheap products and suppliers lost money due to poor management.
We decided to solve the supply side of this problem by pivoting to a B2B sourcing hub. In the first year of business, life was good but as we started growing, we realized having a contractual obligation with our partner factories was not enough. We wanted more control so we set up our own manufacturing unit in 2018. Two years later, we were one of the first factories in Delhi NCR to start the manufacturing of PPE. We created an ecosystem of suppliers and helped them upgrade their facilities to match global medical standards. In a way, Covid-19 was a turning point in our nascent history because for the first time, we managed to implement modular manufacturing on a really large scale.
We are currently a private label manufacturer for some of the well-known global brands apart from owning six brands. In short, we are a closed loop-controlled marketplace for the entire fashion supply chain.
What are the challenges for your sector?
Apparel sourcing and manufacturing from India has constantly faced stiff competition from low-cost countries like Bangladesh and Vietnam. To add to our challenges, the textile infrastructure, particularly our fabric mills have not upgraded like their peers in China. So we end up losing a lot of good opportunities, particularly in high-value knits to Chinese suppliers.
What kind of planning is required for getting local and international brands onboard?
Every brand has a different pain point. Our first step is to understand their challenges and find what is the best way we can help them. Some brands require handholding from the design process. We have in-house designers to support them. Some brands are mature and very thorough, for them, we help them generate cost savings. Our sales team is trained not to make a sales pitch but service clients. Sometimes if we cannot solve their problem, we refer them to others. Our focus is to ensure whatever we do, our clients succeed, even if it comes at a cost of our sales. We don’t push our clients to produce a large volume of certain products when our internal algorithm says those styles won’t do well as per their projections.
What are your expansion plans?
We are planning to expand to the US. We recently incorporated our US subsidiary. This will enable us to be closer to our clients. We are in talks with a very large US brand for an exclusive manufacturing contract for one of their brands. We are also planning to launch a service that would enable Indian manufacturers to launch their private labels in the US market.