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Growth Enterprise
On a design high

Posted by POORNIMA KAVLEKAR

Capitalising on the brands strength, Hidesigns founder Dilip Kapur wants to see
Hidesign as a more established brand in Tier I, Tier II and some of the Tier III cities in
India, by setting up over 200 stores and up to 400 store-in-stores over the next five years

As the founder of Hidesign India Pvt. Ltd. (Hidesign), Dilip Kapurs short stint while
studying in the U.S as an intern with a leather factory for a few months gave him a
different perspective about leather, which later became his lifelong passion. After
completing his education, he returned to Auroville, Puducherry and started making
leather bags. In 1978, Hidesign commenced operation with an investment of Rs. 25,000.
It was the money I saved from my part-time job in the U.S., recalls Kapur. What started
as a hobby soon caught the interest of many people and he landed up with large orders.
Until 1999, Hidesigns products were sold only in the overseas market like Australia,
Europe, U.K. and the U.S. My understanding of lifestyle in India was minimal since I
grew up in the U.S. My design sense reflected the cultural revolution in the U.S. in the
late 60s and 70s, and it was easily accepted in the U.S., U.K. and Australian markets,
among others, recalls Kapur. But looking at the increasing demand from the domestic
market, since 1999, he started selling in the Indian market and, currently, almost 65 per
cent of Hidesigns revenue is from the domestic market.
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With such a modest beginning, today, Hidesign has a total turnover of Rs. 120 crore and
has 67 exclusive stores in India and 12 international stores. During the 2011-12 fiscal,
the company has grown by 24 per cent and expects to grow at the same rate this year too.
Building the brand
Since I did not have education in business management, I was not aware of building a
brand, admits Kapur. However, he was clear about the basic essentials of the brand. He
wanted the product to be unique and not a copy of any other product design. He wanted
the Hidesign brand to reflect his belief in ecological practices, and therefore, used
vegetable tanned leathers to manufacture the product. The leather is tanned in
Hidesigns own tannery to ensure least possible harm to the environment. The raw
material for the tannery is mainly from India, especially from Tamil Nadu and Kerala.
The rest is imported from the U.K., Middle East and New Zealand.
Right from the beginning, Kapur was very clear that Hidesigns leather would be distinct
from the uniformity and synthetic flatness of whats seen in the mass market. It was
almost like giving shape to my instinctive aversion to painted, patented leathers that lose
all semblance of naturalness, recalls Kapur. Learning from the centuries-old skills of
tanning with natural seeds and barks, Hidesign has created fashionable leathers that age
exceptionally well. Hidesigns vegetable tanning uses extracts from the barks of Wattle
trees and seeds of Myrobalan, a fruit-bearing plant species. This gives Hidesigns leather
a rich, nourished look and feel, and tremendous strength and durability. Hidesigns
leather is full grain (they have not been corrected to hide defects) with minimal colour or
pigments to cover the leathers natural beauty. The feel, the look and smell of our
leathers is sensuous and natural, shares Kapur.
Setting up the infrastructure
While Hidesign was growing at a fast pace, its infrastructure at that time did not support
this growth. Since we did not have a factory, we kept hiring one house after the other,
each one larger than the last. We had huge infrastructure problems with the houses being
inadequate to produce quality products, says Kapur. The company finally built its
factory in 1990. All Hidesign bags are manufactured in-house. It has four factory units
one in Baddi, Himachal Pradesh and three in Puducherry. It produces about 18,000 bags
(for both men and women) per month and about 25,000 pieces of accessories per month.
With the rapid expansion of Hidesign stores across India, its production capacity is
always stretched to its limits. However, our work is handcrafted and cannot be produced
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in mass, shares Kapur.

The brand strategy
Hidesign is positioned as an affordable luxury brand. Luxury in our eyes is an
experience. It promises exclusivity against mass manufacturing, shares Kapur. The
handcrafting of Hidesign maintains the unique identity of its product, and the ambience
of the stores reflects this custom-made atmosphere. This identity with a sense of
exclusivity is only possible at this price point in India.
The brand has essentially not changed since it started. Its core values are still the same
natural, ecological and innovative. The changes that take place only reflect the changing
lifestyle of the customer base. The female customer base of Hidesign has increased from
20 per cent to 60 per cent. We are more in tune with Asia, especially India, as Indian
market has grown from six per cent to 65 per cent, shares Kapur.
Hidesigns marketing strategy is to always build the brand, rather than just promotions.
Our campaigns are always brand building campaigns that communicate who we are at
the moment, in the life of the brand, shares Kapur.
Hidesigns ideal product launch strategy is one that combines the talent and the
aspirations of everyone within Hidesign and communicate that to their customers. This
reflects in the new designs as they express their views on the changing lifestyle and the
same communicated through the companys advertisement campaigns, public relation
activities, in-store promotions, social media and its website. Events such as fashion
shows are not very important for us. A well-coordinated launch is clear in its message
and expresses newness through the brands identity, shares Kapur. Hidesign creates
four major collections every year but parts of new collections come into the stores every
month. Every season reflects our mood. It is a reflection of how we feel and how our
customers feel, says Kapur.
Forging relationships
In 2007, Louis Vuitton (LV) invested in Hidesign. The relationship between LV and
Hidesign is one of friendship and mutual help, and not one of a venture capitalist
investing in another company to exit in a few years, shares Kapur. LV, which currently
holds a 5 per cent stake in the company, offers Hidesign technical and business advice, as
and when required.
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In 2009, Hidesign tied up with Future Ventures to launch Holii, designer bags inspire by
India, which is stepping into its seventh season now. As the Indian market matures,
Hidesigns positioning has become narrow as the brand follows contemporary
international lifestyles of young, career-driven customers. The company believes that
the Future Group, with its strong innovative energy rooted in the Indian psyche, is an
ideal partner for this adventure in creating a truly Indian brand. The production
continues to grow well and these bags are presently available in 70 locations across India.
Understanding the consumer
The brand understands the growing demands of the consumer in various upcoming
regions of India. In March 2012, the Alberto Ciaschini-handcrafted by Hidesign luxury
collection has been launched in select Hidesign stores across India. This new collection
marks the debut of Hidesign in the luxury arena with limited edition day and evening
bags for women. This luxury product is on average three times the price of a Hidesign
product. It is still tough to tell how extensive its success will be. But it continues to grow
rapidly and we expect it to contribute about 10 per cent of our revenue next year, shares
Kapur.
The company also plans to launch sunglasses, which is expected to be available in the
Hidesign stores from October 2012. This launch indicates a move in Hidesigns
positioning from a leather goods brand towards a lifestyle brand and opens up options
available to a Hidesign customer, who espouses the brand values, says Kapur.
Hidesign is expanding its market by capturing exclusive and strategic retail spaces across
all major metros and airports in India. It is also targeting smaller towns (Tier II and Tier
III cities) that display a growing consumer profile. By the next year, Hidesign aims to
have over 100 exclusive boutiques in India alone. Over the next three to five years, Kapur
wants to see Hidesign as a more established brand in Tier I, II and some of the Tier III
cities in India, with over 200 stores and 300 to 400 store-in-stores. He expects a steady
growth of 20 per cent to 30 per cent every year and wants to establish the brand in more
Asian countries. With its core values intact, Hidesign is all set to enter lifestyle segments
such as sunglasses and shoes, and reach its classic contemporary designs to a larger
audience.
Hidesign
Founder : Dilip Kapur
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Year : 1978
City : Puducherry
Turnover : Rs. 120 crore
WHAT NEXT?
It is expanding its market by capturing exclusive and strategic retail spaces across all major
metros and airports in India
It is targeting smaller towns (Tier II and III cities) that display a growing consumer profile
It plans to launch sunglasses, which is expected to be available in the Hidesign stores, from
October 2012
By the next year, Hidesign aims to have over 100 exclusive boutiques in India alone
ON A LIGHTER NOTE
DILIP KAPURS:
Most unforgettable moment
Several! My first day in the U.S. as a scholarship student when I was 15-years-old. The first
time I saw a cheetah chasing a zebra in the Serengeti. First time a Hidesign bag was displayed
in a large upmarket store abroad (John Lewis, Oxford street, London).
Favourite holiday destination
Beach number 7 at Havelock Islands, Andaman.
Favourite food
Anything from across the world that is strongly ethnic and homemade.
Loved watching (Movie)
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The English Patient

Favourite pastime
Taking long walks in the forests of Auroville with my dogs and swimming in the sea.
Most valuable lesson
From the Bhagavad Gita, Try your best and dont worry about the results.
Inspiration for designs
Lifestyle changes in contemporary young executives and beauty that surprises us in different
ways
Role model
Steve jobs as an innovator in my work life and the great people I meet.
Advice to budding entrepreneurs
Be unique and innovative

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