Abstract
This teaching case narrates the entrepreneurial journey of Meena Bindra, the founder of the Indian apparel retail brand (BIBA), from 1983 to 2014. Her enterprise achieved incredible growth and has developed a magnificent vision for the future. The case describes the entrepreneurial outlook and decisions that helped tap opportunities and achieve rapid growth amidst the changing business environment. Her success story breaks many myths related to small start-ups by women entrepreneurs and highlights the immense potential and economic contributions by women. It serves as an example and provides support to the call for the active promotion of women’s economic empowerment. The case is based on both primary and secondary data.
Introduction
There are many popular myths related to women entrepreneurship, specifically in developing countries, such as to start a business one needs to be young, one needs a lot of finance, one needs to have the required expertise, a woman entrepreneur cannot manage both work and home effectively, start-ups by women remain small, etc. Well! Meena Bindra—the founder of BIBA, the first Indian apparel retail brand for ready-made ethnic wear—defied them all.
Meena Bindra: A Peek into Her Early Years
Meena Bindra lost her father at a young age and was brought up by her mother in New Delhi with her three brothers and two sisters. She did her graduation in history from Delhi University and got married to an officer in the Indian Navy when she was just 19 years old. For the next 20 years, she lived as a homemaker while moving with her husband all across the country, never staying at one place for more than 3 years. She devoted all her time looking after the home and raising her two sons (Vaddepalli, n.d.).
Bindra had always been passionate about designing clothes, but at that time, there were not any courses in fashion designing that she could do. In the early 1980s, based in Mumbai, she finally got the opportunity to follow her passion. Her children had grown up and she could manage to spare some time for herself. For a business, she neither had much money nor any technical or managerial skills. She had observed that there ethnic wear in the country, and women had to rely on local tailors for stitching. Bindra was no availability of ready-made decided to fill this gap by designing and selling the ready-made ethnic garments (Vaddepalli, n.d.). This was the eureka moment in her life.
With some support from her husband, she managed to get a bank loan of ₹8,000. It was barely enough to buy fabric and pay for the stitching. She decided to play safe and so used just half of the money. Fortune played its part too; she came across a block printer who had his own manufacturing unit. She spent her days at his unit, experimenting with different techniques and designs and finally came up with around 40 salwar suits, which were popular ethnic outfits for casual wear. And in 1983, she held her first exhibition at her house for friends and acquaintances. She managed to sell the entire stock and even got more orders as she kept the pricing reasonable. This gave her the required boost for her morale and the push for her enterprise. With the profit she earned, she bought more fabric and sold more suits. The cycle continued, and within a few months, she repaid the loan completely and had a large stock of suits with her (Varma, 2008).
The Birth of BIBA
Bindra decided to work from her house. She relied on word-of-mouth marketing for her garments through customers due to which her suits were becoming popular. She soon had celebrity clients and wives of famous industrialists. At this stage, she felt the need to name her business and BIBA, the brand, was born. Bindra belonged to the Punjabi community and opted for a name in her mother tongue. ‘Biba’ is an endearment in Punjabi language for a sweet, nice girl or a lady. In no time, a home-based enterprise turned into a real business. She believed in growing with her own earnings. She kept her cash flow smooth as her sales were outright and the manufacturing was outsourced. She managed everything herself, right from buying the fabrics to the designing and then to the selling (Going big…, 2013). She prized fairness in her business dealings, be it with tailors or with customers. She gave lot of priority to keeping her customers happy and satisfied—if needed, she willingly replaced the garment or refunded the money and sometimes threw in a free gift as well. She was happy with her small enterprise; however, word kept spreading around and the business kept growing (Gonsalves, 2013). Making a conscious effort to maintain a healthy balance between work and her family responsibilities, she never extended her work time and wrapped things up before her husband came back home.
Becoming a Wholesaler
In the year 1986, Benzer, an upmarket retailer in Mumbai, approached Bindra to supply 100 suits. This was the first big break for BIBA. The scale of business expanded and she focused more on improving designs, experimenting with a variety of fabrics and even diversified the price range. The orders eventually grew to around US$15,000 a month. BIBA moved out of her home into a small boutique at Kemp’s Corner in Mumbai, funded entirely from the business earnings. Sheetal, another famous retailer, approached her to supply suits. She faced her first challenge when Benzer, which accounted for around 70 per cent of her business, laid down tough conditions in front of her. She had to stick to them and not supply to any other retailer in Mumbai or part ways. This conflict situation put her in a dilemma. It also created the first big challenge for Bindra as an entrepreneur and a decision-maker. Bindra took the difficult route and decided that she would not restrict herself to only one retailer. In hindsight, she never regretted her decision. BIBA very soon became an established wholesaler, with the turnover touching six figures in US$ (Going big…, 2013). But still, there was no business strategy in place, no long-term vision. The business operated in a ‘what is made, is sold’ manner. Marketing and selling were not a problem as their product offering was unique and fashionable. The pull factor was very strong. The main challenge was just to complete the orders in time.
After few years, Bindra’s elder son, Sanjay, joined the business on completing his education. He took over the technical aspects of managing labour, keeping accounts, etc. Bindra could now focus solely on the designing, which was her forte, and was happy with the arrangement. However, another big challenge emerged as her husband was transferred to New Delhi. She had two options before her—either to shut business and move with him or stay back in Mumbai to keep the business going. She once again made the difficult choice. She did not want to give up on BIBA, which was showing a lot of promise. She shifted into a smaller apartment in Mumbai and managed to travel back and forth to be with her husband. BIBA was officially registered as an apparel label later in the year 1988 (Varma, 2008).
Spreading Wings: Brand Building and Retailing
Soon, BIBA was supplying to around 20 famous retailers in India, such as Roopkala, Nalli, Kala Niketan, Sheetal, etc. and had shifted to an even larger office in an expensive locality of Mumbai. In 1991, India’s first multi-brand department store, ‘Shoppers Stop’, approached them for ladies’ ethnic wear. By the mid-1990s, BIBA had become a reputed wholesaler, supplying ethnic wear to top retailers across the country. The business now generated a turnover of US$0.44 million and enjoyed a much greater goodwill.
In 1993, the second major turning point for BIBA emerged. Bindra’s husband retired and she moved her business to New Delhi, leaving Sanjay in-charge of the Mumbai office. Her younger son, Siddharth, also joined the business, and he realized that though retail was at its nascent stage, it had started growing in India and would be the next big thing. He decided that they would need to reposition themselves. In the long run, it would be imperative to sell under their brand name, and he had the vision for setting up their own retail outlets. For the first time, BIBA laid down a growth plan and started networking with retailers (Varma, 2008). BIBA was already a well-known brand and it took the big leap to organized retail.
BIBA pioneered the shop-in-shop concept with Shoppers Stop, a risky proposition as it had to deal with consumers directly and give a minimum guarantee of an amount equal to its turnover at the time. BIBA performed well on this model and eventually was supplying to other multi-brand outlets (MBOs) in India such as Pantaloons, Lifestyle and Central (Vaddepalli, n.d.). Other labels emerged simultaneously, and the shop-in-shop concept became popular in the industry.
This development forced BIBA to become more professional and since the industry was largely unorganized, they had to overcome many challenges. They had to learn to bring costs down while maintaining quality and stand by delivery commitments. In addition, they had to be more aware of fashion trends. Since the margins were lower, they had to improve efficiency. They could no longer ignore production issues or resign to tailors’ lax attitudes. They implemented advanced planning, controls and quality checks on their supply chain. They also devised innovative methods to overcome many issues that came their way.
Taking Flight: Biba Apparels Private Limited
In the early 2000s, BIBA became the pioneer for film merchandising in India. BIBA approached Kishore Biyani, the MD of Pantaloon retail, to provide free merchandise for the Hindi film ‘Na Tum Jaano Na Hum’ produced by him in return for a window display in Pantaloon stores. BIBA received instant recognition for its collection through the movie and went on to design for 10 more popular films such as Devdas, Hulchul, Bhoothnath, 7½ Phere, Baghban, etc. (Dhaliwal, 2012). The foray into film merchandising threw the spotlight on BIBA, the brand. BIBA was the first to adopt through-the-line marketing and many others jumped on the bandwagon in the following years. To further strengthen their Bollywood positioning, BIBA launched the ‘IIFA Bling for BIBA’ line in association with the International Indian Film Academy (IIFA) Awards (Varma, 2008).
The business was registered as BIBA Apparels Private Limited in July 2002 in tune with its expansion plans (Company Wiki, n.d.). The first major challenge for the new company was to build a strong brand and retail presence. BIBA’s first company-owned retail store opened in a Mumbai mall by 2004. The store did very well with a monthly turnover reaching US$18,000–22,000 (Vaddepalli, n.d.). Within 6 months, it opened its second store and a few more in 2005. As the first four–five stores did very well, BIBA stepped on the pedal even though retail is cash and capital intensive. The company moved on to open stores in major cities in northwest India such as New Delhi, Ahmedabad, Jaipur, etc. By negotiating good property deals, it managed to keep operations low cost. Professional consultants were hired to improve efficiencies and high-end software was also installed. In 2006, as volumes grew, BIBA took a US$0.51 million bank loan to expand further (Varma, 2008). Being a family business, it was debt averse and decided to opt for equity financing. They were advised against it by many people, but they stuck to their instincts. This proved to go in their favour later as brands that kept away from this route could not raise money post the sub-prime crisis in 2007–2008 and had to shut business.
By 2007, BIBA’s turnover had reached US$4.41 million, and Kishore Biyani’s Future Ventures invested in the company, buying a 13 per cent stake. The competition was also increasing, and a direct rival emerged in the brand ‘Global Desi’ by Anita Dongre (Bhat, 2014). The company now started thinking about making the brand international.
New Challenges, More Growth
In May 2011, the company faced yet another challenging phase. Sanjay Bindra sold half of his stake in BIBA to the Future group in an all-cash deal to set his own premium brand of designer ethnic wear ‘Seven East’. Future group now owned a 26 per cent share in BIBA, the rest remaining with the Bindra family (Kishore Biyani…, 2011). The other half of the stake was bought by Siddharth. This was a very tough financial and personal decision for Bindra, as a businesswoman and as a mother. They did not have the money for the stake and wanted to retain control within the family. Despite the stretch it would create on family finances, she gave Siddharth her full support, and he managed to raise the funds through personal sources. One reason BIBA is a successful family business today is because Bindra had the courage to delegate and transfer the decision-making process to her son. She believed in him and gave her unending support to his vision. Siddharth Bindra said the following for his mother’s resilient nature:
She has always been a sounding board and a strong pillar of support. She gave me the full freedom to run and grow the business the way I wanted. She does not shy away from handing over tasks to people she realises can perform them better. (S. Bindra, personal communication, February 24, 2015)
Undeterred by the developments, BIBA decided to move forward and the business went through a transformation. There was intense competition in the market and there was a financial strain on the family post 2011. BIBA did not put constraints on its growth trajectory and continued to expand. Earlier, all business decisions were taken by the three family members, but now they hired a new professional team. BIBA decided to push its marketing strategy and took advice from Santosh Desai, MD and CEO of Future Brands on marketing and branding. A fixed percentage of the turnover was earmarked as the marketing budget. It advertised strategically in fashion magazines and national dailies. It also reached out to customers actively through radio channels and a fan page of Facebook (Morbiwala, 2013).
In October 2012, BIBA decided to expand further and acquired a majority stake in the premium ethnic wear brand, ‘Indian by Manish Arora,’ an acclaimed fashion designer in India (Soni, 2013). The product line was further expanded by introducing the kids’ wear line, BIBA girls, ethnic wear for 2- to 12-year-old girls, when Siddharth realized the lack of options in ethnic clothing for his 7-year-old daughter (Morbiwala, 2013).
By 2013, BIBA’s revenues had grown to more than US$44.13 million. The Future group exited BIBA by selling its share to Warburg Pincus, a global private equity firm, and Faering Capital, an Indian asset management firm, for almost the same amount. For the first time in Indian retail, the investor had a profitable exit. The deal valued BIBA at about US$147.11 million and endorsed the effective management and leadership of the company. This was so far the largest private equity investment in the Indian ethnic wear market. Thanks to BIBA, women’s ethnic wear arrived as a category and became sought after in the private equity market.
With the investment, BIBA aimed to set up retail stores in 100 identified cities within India. Ethnic wear preferences vary across different regions in India, making it very difficult for brands to have a national presence. But BIBA took up this challenge and changed the rules. While BIBA’s majority business was from the metros, there was a huge business opportunity, market depth and a lot of aspiration for brands in tier II and III cities. It engaged in selective franchising in such cities as managing outlets was difficult for the company itself. BIBA also partnered with e-commerce sites such as Jabong and Myntra and entered into e-retailing. It even started its own online shopping portal. The online sales accounted for one-tenth of its total sales and were growing well (Bhat, 2014). In October 2013, BIBA tied up with Rohit Bal, another acclaimed Indian designer, to launch a collection of premium evening and occasion wear at selected outlets (Rohit Bal…, 2013).
The Way Forward
Over the last decade, the company’s vision has transformed many times but the ultimate goal has always been to make BIBA the one-stop solution for the ethnic wear needs of women. The company currently wants to expand and focus on ethnic apparels only for the next 3–4 years, although diversification may be considered in the future. It aims to cater to all income categories and age groups. It has segmented its market into three categories—luxury, premium and value fashion. Through more joint ventures (JVs) with acclaimed designers, it wants to strengthen its presence in the high-end fashion category. Recently, it has acquired a substantial minority stake in the designer label ‘Anju Mody’. In April 2014, a value-fashion brand Rangriti was launched by the company to reach the masses and convert customers from the unbranded market. This brand has been received well in the market (Bhat, 2014). In July 2014, BIBA reached another landmark. It opened its 150th store in Bengaluru in a 2,200 sq. ft area which offers all of BIBA’s collections (Figure 1; BIBA opens…, 2014).
Currently, the company faces a number of challenges at the industry and at the enterprise level such as inflation, expensive real estate, taxation and excise duty structure, supply chain issues, shortage of skilled labour, etc. Even the prices of products cannot be increased beyond a point as the markets will switch over to competitors. Despite the challenges, BIBA has its own strengths. It has over 370 sale points across India with 170 exclusive outlets/stores, majority of which are company owned and operated. The company aims to add another 200 exclusive outlets in next couple of years. All the store locations have been selected carefully based on market, footfall, etc. For metros, the preference is for malls, whereas for tier II and III cities, it is for high streets. The rental costs are less than 10 per cent of sales. On an average, it takes between 1 and 2 years for a single outlet to break-even so maintaining this ratio is crucial. Only nine stores have closed down till now and that too because of the closure of malls. The key learning for the company has been that wrong locations and wrong products should be avoided at all costs (Bhat, 2014).
BIBA continues to outsource its manufacturing while focusing on its strengths like designing, marketing and retailing. It employs around 1,200 people and believes in effective personnel management to sustain business growth. BIBA’s garment sizing is taken to be the benchmark in the ethnic wear industry. Its offerings in plus-size clothing have helped retain loyal customers. The company has recently launched a loyalty programme for its customers. It also conducts a mystery shopper exercise across the stores at least four-to-six times a year to test the procedures and interactions with the customers. In addition, personnel from the head office go on shop visits to check on them (Going big…, 2013).
BIBA currently sells in global markets like Dubai, Mauritius and Singapore. In the financial year 2017–2018, the company plans to go international in a focused way and enter more markets such as the United Kingdom, South Africa, the Middle East and the USA where there is a strong Asian influence and an Indian community. It will choose between franchising and JV options for these international stores (Going big…, 2013).
According to a report, the Indian apparel market size is projected to grow at a 9 per cent compound annual growth rate (CAGR). Girl’s kids’ wear and women’s wear are growing faster than men’s wear. The growth of the apparel market in India will be driven by a higher per capita consumption and favourable demographics (Technopak, 2012). This suggests that BIBA is in tune with the market opportunities and has an immense growth potential. From 2010 to 2015, in 5 years, the business has grown five times. The targeted revenue for 2014–2015 was US$88.27 million, but even then, this is less than 1 per cent of the total ethnic wear market in India.
Even with such a small market share, BIBA is the market leader in affordable daily and occasion ethnic wear for women. It created a segment in organized retail where none existed. In the next 6–7 years, it expects to continue growing at 35–40 per cent CAGR and aims to be a US$294.22 million turnover company. All its stores operate at 20 per cent earnings before interest, taxes, depreciation and amortization (EBIDTA) margins and are cash-positive. BIBA is virtually debt free and this attracts investors (Tables 1 and 2; Bhat, 2014).
From small exhibitions at home, Bindra and BIBA have come a long way (Figures 2 and 3).
Profit and Loss Statements for BIBA Apparels Pvt. Ltd (Summary in Million US$)
Balance Sheet for BIBA Apparels Pvt Ltd (Summary in Million USD)
Today, BIBA is the largest home-grown pan-Indian women’s ready-made ethnic wear fashion brand. On her entrepreneurial journey, Bindra said the following:
It was actually a wonderful, fun journey. I enjoyed myself immensely. I look back on those years with very happy memories. There was no pressure. I was working from the house, everything I made was selling and I made some excellent friends. I was not doing it to setup a huge business; I did not foresee BIBA like it is today. (M. Bindra, personal communication, January 8, 2015)
As the chairperson of BIBA, Bindra today is involved only in the design aspect, giving briefs to the designers and interacting with them. She enjoys spending quality time with close friends and family, listening to opera and classical music and reading spiritual books. She laid the foundation of the business and her son continues to build on it. The journey is not yet over, it has just begun.
BIBA by Meena Bindra: A Successful Role Model for Women Empowerment
This inspiring growth story started because one woman wanted to use her time well. A woman decided to pursue her love for designing. Bindra believes that every woman has the potential and the capability. Women should not hold themselves back but do things they are passionate about. Women should first enjoy the fact that they can work and tap into opportunities to work from home. When you love what you do, results always follow (Gonsalves, 2013). To existing and aspiring women entrepreneurs, she said the following:
Women are lucky that they are at a period when there are so many opportunities. There are so many careers open to women which were not there thirty years back. So many things one can do from home…there are umpteen opportunities. So I feel that a woman should not feel restricted… . I think every woman should find time for herself, time to do something that she really wants to do and not have self-doubt. Because if I could do it, I’m sure every woman can do it. I had no special talent or was not trained for anything—finance or design. I was a graduate, got married as girls were expected to do at that time and brought up a family. And that’s what I did till I was about thirty six. And then I felt that I needed to do something and maybe earn a little extra money… . I started with absolutely no money. I had no bank account. I had everything going against me… . Everything is a challenge. Whenever a woman faces any kind of problem, she should not get discouraged. All are solvable problems. If a woman has the focus and the will to succeed, there is no reason why she would not. Women have somehow more patience and some of the virtues that would make a very good entrepreneur. (M. Bindra, personal communication, January 8, 2015)
Dr. A. P. J. Abdul Kalam, the former President of India, stated, ‘Empowerment of women leads to development of a good family, good society and, ultimately, a good nation.’ (Empowerment of…, 2013). Women constitute a sizable portion of the human resource of a nation. This resource remains largely untapped in economies, pulling down efficiencies and competitiveness. Women’s economic empowerment is a win-win concept that benefits not just women but the society and economy at large. It is a means to achieve goals such as poverty alleviation, improvement in health and education, enhanced national productivity and economic growth (International Center for Research on Women [ICRW], 2011). On women empowerment and BIBA’s efforts to promote the economic empowerment of women, Bindra said the following:
I feel very strongly about women’s economic empowerment. I think it is very imperative that women should have their own income; their personal money. It redefines them. If you are just totally dependent on your husband’s income, you are a second class citizen in your own home most of the time. But once you have your own money and you are little more independent, it makes you feel like a better person. I think it is very important for women to strive to do something by which they are no longer so helpless and so dependent… . Women should be empowered. And it has to start from the young age of a girl. Girls must be empowered from childhood and within the family. They have to be given education at par with the boys in the family. There should be no discrimination. Same opportunities should be given to a girl as to a boy. That will come from improving general education and awareness… . BIBA as a company is very conscious of women’s problems. About forty per cent of BIBA’s employees are women. The company gives adequate paid maternity leave and offers flexible work hours to women with small children. As part of its corporate social responsibility initiatives, I would make sure BIBA spends the largest sum on promoting girl education and empowerment. Empowering girls and women is something very close to my heart. (M. Bindra, personal communication, January 8, 2015)
Footnotes
Acknowledgements
The authors wish to thank Meena Bindra and Siddharth Bindra for their support in developing this case and their permission to publish the same.