Introduction:

FabIndia is a well-known retail brand that sells various hand made products through its stores across India and overseas. They are probably the best-known urban middle class brand in India. It would not be wrong to say that they define the middle class look for Indians. Founded in 1960 by John Bissell to market the diverse craft traditions of India, Fabindia started out as a company exporting home furnishings. The first Fabindia retail store was opened in Greater Kailash, New Delhi fifteen years later. By the early eighties, Fabindia was already known for garments made from hand woven and hand printed fabrics. The non-textile range was added in 2000, while organic foods, which formed a natural extension of Fabindias commitment to traditional techniques and skills was added in 2004, with personal care products following in 2006. Handcrafted jewellery was introduced in 2008. Today, with a pan-India presence, Fabindia is the largest private platform for products that derive from traditional crafts and knowledge. A large proportion of these are sourced from villages across India where the company works closely with the artisans, providing various inputs including design, quality control, access to finance and raw materials. Fabindias endeavour is to bring customers a choice of products and lifestyle that offers an alternative to the mass-produced, while creating sustainable livelihoods in the rural sector. Fabindia links over 80,000 craft based rural producers to modern urban markets, thereby creating a base for skilled, sustainable rural employment, and preserving India's traditional handicrafts in the process. Fabindia's products are natural, craft based, contemporary, and affordable.

The FabIndia Ecosystem:

Fabindia enjoys a network of 175 retail stores across India, 2 stores in Mauritius, and 1 store each in Dubai, Italy, Nepal and Singapore. Its supply chain is based on Supply chain based on inclusive capitalism: co-option of 22,000 artisans and making them into shareholders through an elaborate communityowned model Designers and business experts are directly employed by Fabindia. Few of the designers work with the artisans while others form the product selection committee. The key responsibility of this committee is to select new artisans and weavers and ensure that the quality standards are met before ordering the products Fabindia created a fund, Artisans Micro Finance Private Limited (AMFPL), a fully owned subsidiary of Fabindia, that would bring these artisans into regional supplying companies spread across the country. By creating private limited companies it became easier for these companies to borrow money from banks against orders from Fabindia. Over the years, Fabindia has added several new product lines to its business - from apparel to furniture, jewelry and personal care products and even organic food. But it kept adding new SKUs (stock keeping units) in the existing space with the result that many of its stores are now packed to the brim.

Fabindia supply chain:

Fabindias suppliers are predominantly from rural India. The supply chain has 2 suppliers, the artisans and the fabricators. The artisans are the weavers or painters from a rural background so the designers are the ones who are responsible for communicating with the artisans and making them aware of urban needs and trends. The designers have a deep knowledge of textiles as well as the urban sensibilities.
Since most of the fabindia artisans are poor and illiterate there are few written contracts that exist and govern supplier behaviour. Each potential supplier comes through a reference from an existing supplier. Initially the supplier is given a trial order and based on the performance of the supplier, they get regular orders. The Fabindia supply chain has moved on from a centralized warehouse model to a more decentralized model. To shorten the supply chain and incorporate the artisans within the process in a greater way, fabindia introduced the concept of community owned companies. The weaver approaches the Supply regional company i.e. SRC with. At the SRC level the designer steps in to help artisans produce something relevant to the target market. The design is then approved by the PSC or the product selection committee. Here the fabrics and the quality of factors like color fastmess are determine and compared to the company set benchmarks. One the product is selected by the PSC the order is placed after price negotiation with the weaver. The orders are completed by the weaver and brought to the company warehouse. The fabric is delivered in the form of thaans. However there is no uniformity in terms of the length

of fabric incorporate in each of the thaan. It varies from 20m to 50m. The stock then moves from the SRC warehouse to the regional warehouse. The issue that fabindia faced in the initial stages was orchestrating the supply chain which would cater to the large volume of supplies as well as maintain quality. To resolve this the model of SRC s was introduced. The SRC are in direct contact with the artisans and serve as interfaces to the urban markets. The SRCs are also responsible for getting the artisans credit and capital that they require. 17 SRCs have been setup in different parts of the country to deal with suppliers across the length and breadth of the country. The artisans have a 26% stake in the SRCs and the rest is owned by the investors and the fabindia. Once the order has been received at the SRC warehouses it becomes a part of the fabindia online inventory system. The levels of stock and orders for a particular product can thus be moni tored online by the reatailer. As and when the retailers place their orders the products are moved from the SRC warehouses to the regional warehouses and distributor points. At each regional warehouse a continuous review model for inventory of products is followed. On the retailer side, each retailer orders as a single entrepreneurial entity. For various kinds of products bins or wallet sizes are defined and the retailer is allowed to stock up only upto a given wallet size. SRCs have evolved the supply chain of Fabindia from a centralized model to a regional supplier companies. Benefits of this novel approach:

Enabling it to create 100,000 sustainable rural jobs across India Access to working capital the main hurdle to capacity building Direct interface with artisans Closer to sourcing shortening the supply chain, better quality and pricing Enables the purchase of materials in bulk so as to get the best price

Key challenges in current supply chain:

The main problem for Fabindia is to maintain consistency of products since the suppliers and manufacturing locations are scattered over a large geographical area on a small scale. As these products are made in interior, rural locations in various locations, it has been difficult to maintain same level of quality due to lack of knowledge on urban customers and also cultural, behavioural differences in suppliers across different locations. In case of organic products, Market in not matured. So it targets customer with prior knowledge on this product. The major problem there is fickle delivery and product availability, which does lead to customer dissatisfaction. But this is a very small part of the customer base.

References 1. http://forbesindia.com/article/big-bet/fabindias-tightrope-walk/29762/0 2. http://www.fabindia.com/company/ 3. http://www.indianretailer.com/article/operations/logistics-and-supplychain/Empowering-Sustaining-through-Supply-Chain-280/