Tailors

In a little street called Narayana Pillai Street, off Commercial Street in the Shivajinagar area of Bangalore there stands a building called “Ganesh complex” which can be called a tailoring hub. There are some ten to twelve shops (forgive my arithmetic if I’ve counted too low) all of which are occupied by tailors who stitch women’s clothes, primarily salwar kameez and its derivatives. I don’t know if there’s much to choose between the stores, and I think it’s a question of “tailor loyalty” the way it’s practiced among beach shacks at Baga beach in North Goa.

The wife is friends with a tailor called Ahmed, who runs a shop called HKGN tailors in this complex. Till recently (when he took two weeks with a consignment) his USP was “one hour tailoring”, where upon receiving cloth and measurements, he would stitch your dress in about an hour. I hear that there are a large number of tailors in the vicinity (though not sure if they’re in Ganesh complex) who offer the same terms. In fact, I know a lot of women who travel to that area to get their clothes stitched both for the quick delivery and also for the network of tailors that is present there.

While waiting for Ahmed to deliver the wife’s latest consignment yesterday (the one he took two weeks with), I was watching tailors in neighbouring shops working. The thing that struck me was that there isn’t much economies of scale in bespoke tailoring. Each piece  of cloth needs to be cut separately, in its own size, and there’s nothing that can be “batch processed” across different samples. Of course, there is tremendous scope for specialization and division of labour, so you see “masters” who measure, mark out and cut cloth, and “stitchers” who stitch up the stuff together.

However, across the city, except for the handful of tailors in the Shivajinagar area, the standard turnaround time for stitching seems to be about two weeks. And given the wife’s experiences (I usually buy readymade garments so not much insight there) it is a fairly disorganized industry and requires several rounds of follow-ups and waiting at the tailor’s shop in order to get the goods.

The economics of the industry (that there are no economies of scale) makes me wonder why the two-week-turnaround time has become standard in this industry. Isn’t the turnaround time solely because of inventory piled up at the tailor’s? Can the tailor not manage his inventory better (like say going a few days without fresh orders or hiring a few extra hands temporarily or working a weekend) and thus lead to much shorter turnaround time? Given the individual nature of the job, what prevents tailors from offering instant turn-around like the handful of people in Shivajinagar do? Or is it that bulk orders (one person coming with a bunch of clothes to stitch) mess up any “quick turnaround model” the tailors could offer?

There is only one explanation I can think of. “Sales” and “production”, for the tailors happens at the same spot (their storefronts). For “sales” purposes they need to be there all the time, though they don’t need to be actively doing anything. Hence, it suits them if production is also a continuous full-time process, so that the time they spend at the storefront isn’t all “wasted”. By piling up an inventory of orders, tailors are always assured of having something to do even if no fresh customers are forthcoming.

So as the wife’s experience with Ahmed has shown, the “quick turnaround” hasn’t been sustainable at all.

Inventory

You know inventory represents a huge cost when online retailers such as Flipkart which don’t have to invest in keeping inventory at storefronts in expensive malls and high streets offer massive discounts, of the tune of 30 to 40% at times.

You know that inventory represents a huge cost, and shop space is precious, when you go shopping in summer trying to find a nice sweater and find that no half-decent store is even selling sweaters!

Oh, and I think you can judge the standard of a clothing retailer by the quality of their trial rooms.

Reliance Retail?

So on Sunday morning when I went to Reliance Fresh down the road I saw this guy who runs a vegetable store nearby frantically running between shelves, stocking up huge quantities of fresh vegetables. If this were a government store, and if this were license-permit raj, we could have said that this guy was hoarding vegetables.

While this explained why you seldom get fresh stuff at Reliance Fresh later in the day, it made me wonder if Reliance Retail is actually a retail operation. Given the amount of vegetables that this retailer was buying it seemed like it was more profitable for him to walk down the road and source the stuff from Reliance Fresh, rather than traveling a few kilometres down the nearby KR Road to source from the city market.

So thinking about it, this is probably reliance fresh’s strategy. Apart from selling to retail customers, they also make money out of supplying to nearby retailers, who take advantage of the lower prices at Reliance Fresh in order to make a margin for themselves and avoid the long trudge to the wholesale market.

I’m sure Reliance Fresh doesn’t particularly have a problem with the deal, except that they might lose out on customers who know about the poor quality of vegetables one gets there in the evening and so decide to not shop there for other groceries also. Customers know when to get good stuff so they don’t mind. The retailers obviously don’t have a problem.

Neat, ain’t it?

Shoe Shopping

I went with the significant other last weekend while she bought shoes. And realized that the way girls buy shoes is completely different from boys’ decision process. Yeah, I know you’ll be thinking I’m just stating the obvious, and I might be doing that. And again, this post is based on two data points – myself and the significant other. I conveniently extrapolate.

Fundamental theorem of shoes: The number of pairs of shoes a boy owns is small compared to the number of pairs of shoes a girl of the similar age/socio-economic stratum owns.

I don’t think I need to give any explanation for that. The rest of this post is a corollary.

Corollary 1: The amount of time a boy spends in buying one pair of shoes is significantly larger than the corresponding amount of time a girl spends.

Yeah, this might sound counterintuitive, which is why I’m writing this post. So I think there are several reasons for this, but they all follow from the fundamental theorem of shoes
1. If you have one pair of shoes of a certain kind, you can’t afford to make a mistake buying them. You need to go through a careful decision process, evaluating various pros and cons, before deciding on your perfect shoe.
2. Boys’ shoes need to multitask. For example, you will wear the same pair of black leather shoes to office, and to that random wedding reception. The same sneakers you wear to play football might be worn for a casual evening out. So each pair of shoes needs to serve several different purposes, so the search space comes down accordingly
3. The cost of going wrong is too high – if you have a policy to own a limited number of shoes, and you buy an ill-fitting shoe, you have to live with that (or throw with extreme guilt) for a very long time.  This happened with my earlier pair of sneakers, with the unintended consequence that I went to the gym much less often than I’d planned to
4. The amount of time a boy spends in a particular shoe is much more than the amount of time a girl spends in a particular shoe. So it is important for boys that each and every shoe is absolutely comfortable and fits perfectly. Again increases search time.

Recently when I had to buy a pair of formal shoes for my engagement I drove Priyanka mad with the amount of time I took to decide. I visited several shops, tried out lots of shoes, walked around, walked out, visited more shops and so forth. And all this after I had decided I wanted a pair of brown shoes without laces.

Corollary 2: The average cost of a boy’s shoe “wardrobe” is comparable to the average cost of a girl’s shoe “wardrobe”

Yeah, unintuitive again I guess. But backed up by data. My shoes, on average, cost well over a thousand rupees. Priyanka’s shoes, on average, cost well under that. It’s a vicious cycle, and I don’t know where it starts. I want my shoes to last longer, so I want to buy shoes of better quality, so I end up spending more on them. Or it could be like I wanted my shoes to last longer precisely because they are expensive. But I’ll stick my neck out and say that all this stems from the fundamental decision of not wanting to wear too many pairs of shoes.

For a girl, the cost of going wrong with a shoe purchase is low, given the frequency with which she wears a particular shoe. Also her shoes don’t multitask, so she can afford to have a few pairs which are not exactly perfect fits, as long as they serve the purpose. She has this urge to shop for shoes, and with her monthly budget in mind she is naturally conditioned to not splurge on them.

So I was kinda horrified (not exactly, since this had happened a couple of times before) last weekend when Priyanka walked into a shop, picked up a pair of chappals from the shelf, dropped them to the floor, stepped into them for a few seconds and decided to buy them. They didn’t cost too much, so I guess the cost of going wrong was small, but I would’ve never done something like that.

Barista Update

The Barista at Barton Center on MG Road has suddenly become so much more bearable, as they have turned down the volume of their music to a level such that you can actually have conversation without shouting. On a related note, it seems much easier to find tables there compared to earlier (yesterday we walked in around 6 and found several tables empty; earlier there would be a long wait at that time).

On yet another related note, they seem to have done something about the pricing. It’s friggin’ expensive now (70 bucks for a small cappuccino?) but I think they’ve gotten it right. There is obvious value in the restaurant as shown by the long waiting lines that used to be there earlier, and the restaurant is now simply monetizing that value rather than using artificial means (loud music) to chase people away.

As a former revenue management professional (damn; that sounds so corporate whoreish) I’m happy they are doing what a coffee shop like them is supposed to do – providing excellent environment for long conversations and chilled out afternoons, and actually charging for what it’s worth.

The earlier method was so cheap and country – they were clearly underpriced because of which there was overcrowding and they weren’t able to meet demand and had to use other measures such as playing loud godawful music to keep the crowd rotating.

Two thumbs up to Barista’s new pricing and music policy!

FabIndia Koramangala

There are very few clothing stores that I can say I’m in love with. There are very few stores where I feel like buying a large proportion of merchandise on display whenever I visit it. There are very few stores where just the atmosphere makes you buy much more than you had planned to. And it’s a pity that on two of my visits to the store, I bought nothing.

I haven’t been to too many FabIndia stores outside Bangalore (only a handful of stores in Gurgaon and maybe one in Delhi) but having shopped a few times at the FabIndia store in Koramangala, I feel distinctly underwhelmed whenever i go to any other outlet. Having been several times to this beautifully designed house, I find FabIndia outlets housed in less spectacular buildings sad. Of course there have been times (including two days ago) when I’ve shopped at other outlets but the experience simply doesn’t come close.

The first time I went to the store was some four or five years back when Anuroop wanted to check out kurtas. I think we went there on Bunty’s recommendation but I remember that I hadn’t bought anything. I had quickly made amends for it a couple of months later when I bought a couple of shirts, and then a year later when I bought a dozen shirts at one go!

The only other time I went there without purchasing anything was yesterday morning, when I was visiting the store after a gap of some two or three years. The first thought was one of guilt – of having shopped in a less spectacular Fabindia store (the one at Kathriguppe) just the previous night, and then as I got over it I got overwhelmed with the variety on display. I suddenly got afraid that I might over-spend and made a dash for the exit.

I wasn’t gone for too long, though, as I returned in the evening with Priyanka, and this time we discovered something even more spectacular – something that I had completely missed during my hajaar earlier visits - the store cafe. The brownie was decent, and the coffee was just about ok, but that didn’t matter one bit. Once again, it was the atmosphere at play, and that the coffee shop had in plenty.

It’s something like a small arena. If you can perform some visual art (say a play or a dance) in a five feet square area, this is just the place for you! All around the 5×5 “well” (which is full of pebbles) are stone benches, at different levels. Cushions have been placed on some arbitrary benches, and we understood that that’s where it was supposed to sit. There wsa some music that I didn’t quite recognized but was quite pleasant, and the wooden trays in which the waiter brought our coffees were also beautiful – I might have bought something like that from the store had I been in a spendthrift mood yesterday!

If you are in Bangalore and are interested in cotton clothes you should definitely check out this store sometime. It’s in Koramangala, in the extension of the intermediate ring road. Make sure you go there leisurely, for there is plenty to see and buy (the inventory is about six times as much as that of an “ordinary” FabIndia store). And while you are there, do visit the cafe and lounge around there for a while. And think about Priyanka and me while you are there.

Orange Juice and Petrol

So I was reading this article by Ajay Shah about administered pricing for petroleum. He does an excellent (though it gets a bit technical in terms of statistics) analysis about what could go wrong if the government were to free pricing of petroleum products. He mostly argues in favour of deregulation, and that is a view that I completely endorse.

One of the big fears about deregulation that he mentions is the fear that volatility in retail prices of petroleum products might increase, and he argues that this is a good thing and is much better than the government artificially hiding the prices and subjecting the junata to major price shocks once in a while. While I agree with him on this, I don’t think prices will change frequently in the first place.

While I was reading this article, I started thinking about the neighbourhood Sri Ganesh Fruit Juice (yeah there are a dozen of those in every neighbourhood in Bangalore) center. About how the guy keeps the price of orange juice constant throughout the year, despite the price and availability of oranges themselves fluctuating wildly across seasons. Yeah he might do minor adjustments such as changing the proportion of water but he can’t do too much of it since he needs to maintain quality.

The basic funda here is that customers want certainty. Every time they go to the shop for their fix of orange juice, they want certainty in the prices. Even if you are on an average cheaper, you will lose customers if your price is more volatile than your competitor’s. Of course there are occasions when you can’t help it and are forced to change your price – and on these occasions your competitors are also likely to do the same. But as far as possible, you try your best to decouple the price of orange juice from the price of orange which is pretty volatile.

Now I don’t know if the volatility in crude oil prices is more than the volatility in orange prices (it’s likely to be) but considering that oil companies are supposed to be more sophisticated than your neighbourhood juice shop guy, I would expect similar behaviour from them – of keeping retail prices of petroleum products as stable as they can. Of course they are likely to follow long-term trends but they are surely not going to pass on the short-time noise in prices to the customers.

So this fear of increase in volatility of retail prices is unfounded, assuming of course that the oil marketing companies are good businesspeople!