Financial Management for Textile, Fashion and Apparel Entrepreneurs
With thanks to SDC member Dr K S Murthy, Pidilite Industries Ltd, for reviewing this recent event, which took place in India.
Mr Sanjay Rahate and Mr Basesh Gala spoke on “Finance Management for Textile, Fashion and Apparel Entrepreneurs” in an interactive seminar organised jointly by Department of Textile and Fashion Technology College of Home Science, Nirmala Niketan, B D Somani, Sophia Polytechnic and the SDC in October 2015 at B D Somani Institute of Art and Fashion Technology in a packed auditorium.
Ms Raju Bhatia, Head of Department, Fashion Technology welcomed the audience. Dr Ela Dedhia of Nirmala Niketan and Chairperson of the SDC Trustee Board gave a preamble to the session and stated awareness of finance related literacy is necessary for students who turn out as entrepreneurs with their technical knowledge.
Get Set Go World
Mr Sanjay Rahate is a mind trainer with interpersonal and communication skills, personality and leadership development skills in addition to being a Neuro Linguistic Programme practitioner. The current winning formula adapted by the present generation in the competitive changing world is go to school, get good grades, a respectable degree and a secured job. If you understand and unleash your potential, you can achieve whatever you want to do. Mr Rahate discussed the following points.
- Mind: Keep a positive attitude, do inspirational reading, relaxation and development training programme.
- Teaching and training: Learning process has to help become a genius in any subject.
- Skills required for success in life: core purpose, goal setting, vision, mission, value principle, communication skills, people skills, public speaking, time management, planning, strategy making, leadership skills, marketing and selling skills, entrepreneur skills, coaching and counselling, money management and negotiation skills.
- Students obtain variable percentage marks – how does it happen? Neuroscience resolves that and makes the students learn appropriately wherever the need arises resulting in overall development.
- Entrepreneurship: Will, psychology, operational skills, spiritual aspects of business in different phases eg product, client, social media and zero resistance selling; Customer Relationship Management system (understanding cash, customers and materials); branding and employees; franchises and branches (patterns in business).
- Active business communication, team building, effective communication skills, language enhanced skills, presentation skills, telephones and corporate etiquette.
- Power of equity; coach in your business and learn from the best.
Women and Entrepreneurship
Mr Basesh Gala, 39 Solutions said technical skills are the backbone besides the way you present, lead and negotiate. He spoke on the challenges women entrepreneurs’ face and the basics of business. Understanding business, having mentor(s), resources, networking and family support are necessary. In financial planning and business planning, basic understanding is needed and the power of investing wisely.
- Expense = Revenue – Savings
- Savings = Revenue – Expense
- Finance = Revenue – Liquidity Savings – Investments – Charity
Einstein said that compound interest is the Eighth Wonder of the World. With the power of compounding, the money invested multiplies because of interest and inflation. The problem in the clothes industry is liquidity ie payments. The time cycle is considered to be eight months on average. This is the power of finance. How would one work pricing with such lead time of cycle cost?
Jacque Welch, General Electric said business head is easy to measure by D Factor.
1. Cash flow – How well you manage besides working capital and funds
2. Employee engagement
3. Customer experience
Focus on these three basic blocks will take care of business. Understanding the way we finance is important. When it creates stress, you look for extraordinary opportunities. Having revenue creates pressure and if you handle that pressure, it forces you to innovate. So start having goals in life. A goal with no plan is just a wish.
Setting financial goals
Write your goals and be specific, measurable, assignable, realistic and time-bound. Visualisation will help achieve them. Goals should be smart. He exemplified his life journey at the start when for six months he had no income with zero business and 3-4 employees but today he has 25 employees with 40 clients.
Identify your time-specific goals viz. short-term (achieve within a year), mid-term (within five years) and long-term (after five years). For opening a boutique, do market research, find partners with funding. You may get a shop designed and equipped with furniture free of cost and most stalwarts entering into this concept are unaware of such facilities without investment, deposit and rent too. Share whatever revenue you get at 20% or 30% with them. Whatever you plan and steps you take, make it simple, even if it is a personal transformation and business growth.
Tips for women entrepreneurs
Think of a brand in your industry, be it personality, company or network. Be aware of what is happening in your industry. Be yourself and get inspiration from the leaders. A product has three specifications – functional, technical and emotional eg the function of clothes is wear and good fit; light material, good design, no wrinkles, needs no ironing and with technical expertise you will be ahead of the competition. But if you want a brand, have emotional specifications. So for having a boutique or shop, understanding service, creating an emotional connection and making sure that purpose specification is correct.
Business and markets media
93% of marketers use social media for business. 70% have a good presence in Google; 70% use Facebook which is a fantastic tool to generate new price and 70% get new clients on Facebook and 34% use Twitter.
Success stories were highlighted of Indian women entrepreneurs like Meena Bindra, who created the pan-India brand BIBA, which is one of the largest dedicated ethnic wear brands. Richa Kar with technical skills launched Zivame. It is an online store sending the goods for trials and return if you don’t like, thereby avoiding embarrassment and understanding the customer’s view point. Whatsapp and FB status is another case in point. Ms Kuruvilla, 25 sold over Rs 50 lakh as she kept posting sari designs, once the order came, she did the negotiation on WhatsApp, tying up with the logistics partner for worldwide spread and during the wedding season she sold 600 custom made bridal saris each costing a minimum of Rs.10,000.
Mr Gala concluded with the formula that Finance is Revenue–Liquidity Savings–Investments–Charity. Whatever money you make, put some in liquidity pool, invest and give back something to the society. What you grow with, make sure that your goals are smart, specific, measurable, assignable, realistic and time-bound.
For details of forthcoming events, please check the SDC website.
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