An entrepreneurial journey is a roller-coaster ride. From a business idea to funding and running a business – it needs extensive research and unending determination. This puts a lot of pressure on the product-based companies who have to keep a strict eye on the manufacturing process.
However, our business ecosystem has witnessed tremendous growth in the past few years. And, third-party manufacturing units, or OEMs, have emerged as saviours for all those companies who do not want to build an in-house manufacturing facility. Their business gains as they contribute their effort and time on other matters.
Here are the top SMBStories of the week. Many of these companies found outsourcing to be best business model.
In 1966, Parmeshwar Dayal Lakhani founded Lakhani, a Made in India, premium footwear company that still has a name in Indian households.
However, in the mid-2000s, when multinational brands like Nike, Puma, and Adidas entered the Indian footwear market, Lakhani, which once held a major percent of share in the industry, faded into oblivion.
In an interaction with SMBStory, Mayank Lakhani, the second-generation entrepreneur of Lakhani Vardaan, says, “When MNCs entered India, it was a game-changer for the footwear industry. These big brands outsourced their products made with new machines. However, Lakhani followed a practice of in-house manufacturing that didn’t meet the demand-supply chain. It was difficult to operate in the whole new concept in a jiffy.”
From not being operational for three years from 2010, here’s the story of how Mayank revamped the company’s traditional business model.
“Lakhani serves the masses and I wanted to take that legacy forward but with a different approach. I brought in 90 percent outsourced manufacturing, which major big brands follow,” Mayank says.
Mayank initiated the concept of brand sourcing in Lakhani Infinity, where products were manufactured by outside suppliers, and the team ensured strict quality inspection and compliance. And a new journey started for Lakhani.
In 2018, the company achieved the highest turnover of Rs 100 crore. At present, it is seeing Rs 105 crore turnover, and aims to reach a milestone of Rs 200 crore by 2021.
Nishtha Malik was 17 years old, and her 18th birthday was just two days away when her mother took her last breath. It was a devastating phase as she saw her mother struggle with lung cancer and ultimately lose her life.
Her mother’s death left a huge void in her heart and life, but Nishtha shouldered on. After completing her Class 12 in 2012, she completed her graduation and moved to London to complete a master’s in entrepreneurship. In 2019, she came back to India and explored the organic haircare market in the country.
She was disheartened when she saw that the industry was lacking, especially when it came to wigs and hair extensions. The pain point hit home as she had seen her mother struggling to find a wig after she lost her hair during the treatment process.
She decided to focus on this untapped market and launched her company, Beaux, in June 2019 with a capital of Rs 8 lakh, which she borrowed from her father.
Beaux makes wigs, toppers, coloured hair strands/streaks, hair scrunchies, and hair wraps. After launching in June 2019, in six months, the company has made average sales of Rs 12-15 lakh, and has started exporting to South Africa, Dubai, and Turkey.