Nalli Silk Sarees.docx

About – Nalli Silk Sarees Private Ltd. Nalli Silk Sarees Private Limited was a family owned and operated business that retailed Indian ethnic wear. This 83-year-old company had enjoyed impressive growth with a $95 million turnover, a 22-store retail footprint, and had outdone its competitors by being the only player in its segment to have a national presence. Headquartered in Chennai, India, the company built its unique national brand by emphasizing innovation, customer centric practices, quality, and honesty across the store's retail operations. In 2011, with changing dynamics in the Indian apparel market, the company started to face intense competition from small and large Indian and foreign retailers. The company's chairman, Dr. Nalli Kuppusamy Chetty, announced a $25 million expansion plan and proposed the opening of 12 new stores over a period of two years. This case focuses on the company's pricing strategy, merchandising process, and product assortments to support its own competitiveness and overall customer experience.

Top Competitors 

Babu Silk & Readymades

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Prakash Silks & Sarees

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Ritika Private Limited

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Ramachandra Silks

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Pioneer Embroideries Limited

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Kalanjali Arts & Crafts

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The Chennai Silks

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Nawaz Silk Mills

Problem Faced by Nalli Group 

In year 2011,They are adopting old technique of selling their product that is sareers. Mr. Kappusany came to know that market is becoming more tuff and hard for me to sell my paroduct in the Indian market.

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The company was also starting to face intense competition from large Indian & multinational corporation.

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Heavy discounts given by new stores.

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Presence of less labour. 2

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Demand of more wage by regular labour who are working in Nalli Group.

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Main market & customer for Nalli Group

In year 2009-10 , India was the second largest customer and second largest producer of Silk in the World. India had number of silk wearing centres spread across the country and each center had its own uniquedesign, pattern and style of weaving. For Nalli group main center was locked in small temple town of Kanchipuram 70 km from Chennai. So they are targeting small town of Chennai, but now its time to wake up because other competitor are coming and capturing the market by attracting people and giving them huge discount on sarees.

Quality & Integrity : Nalli Silk Saree If we talk about quality Nalli had shown good performance and giving good quality and customer services . His family member often recollected an occasion when Chinnasamy worked continuously for days to weave honour the deadline given by customer.

New Innovation In 1930, chinnasamy become the first saree retailer to use high quality chemical dyes from Switzerland. In 1980 Nalli become the first textile retailer in India to use bar codes and computer for their biling and back office use. They also introduced a new sentence that “ RESPECTING A CUSTOMER’S HONOUR MATTERS MORE TO US THAN HIS MONEY”

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BUSINESS PRINCIPLES OF NALLI GROUP  Retail Pricing Strategy They applied a uniform pricing margin to reduce the fluctuation in the market and to make fixed uniform makeup over the cost of purchase from the vendors. 

Real estate Strategy

Most of the initial stores that were that were setup by Nalli were housed properties owned by the group.

 Shelf Space Management Shelf space was utilized effectively bby Nalli to bring moore customers into its stores and increase sales from existing customers.what they think is “They may not be our number one seller in all locations, but we cann’t survive without Kanchipuram silks since they were our namesake.”

 Vendor Management The Nalli group built deep and extensive relationship with weavers in Kanchipuram. This is important because to capture the market of Chennai this will be very important. As Nalli group

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expanded its operation . It would not not be only to deepen relationship with its existing vendors but also identify high quality and consisting vendors in an already shrinking weaving industry.

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Conclusion

Nalli group had perform really very well in market area and were doing more and more innovation for their customers and also face the completion in well manner from last 83 years. There was limited brand awareness amongst the new customer segments and competiton was only intensifying. Sales volumes were also expected to drop due to an increase in the price of raw silk and precious metals such as gold and silver which were intrinsic to the saree weaving process. So, charging a premium for the reliability and quality that the brand offered. But he really wondered how would customers and competitor respond to such a drastically different approach.

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