How to earn crores in low investment?




Yeah, you read it right how to earn crores in low investment. Today will be looking at the case study La scoot - An online ethnic wear clothes website. In this case study, we will be discussing 5 points:

1. Asset light model

No need to buy an asset keep it light. The first asset you need to set up a garment industry is space, and once you bought land then you have to build a building on it, building you have to set up machines and when you have installed machines then you need manpower and when many people are working together then you need to maintain it for long period.

If you don't use any of the above then you are running an asset-light model. Full business in on Job work outsourcing. La' Scoot doesn't manufacture the garments nor sell the garments they just print the money using the fly light model. La'Scoot manufacture garments at job work, but keeps the quality assurance in his hands. Distributors and retailers sell those garments. For example:

Apple doesn't manufacture its phones - Flylight

Coca Cola doesn't manufacture their bottles - Flylight

Facebook doesn't write content - Flylight

Uber doesn't buy taxis - Flylight

La' Scoot doesn't manufacture their garments - Flylight

2. Quality Secures your future

One of the most important factors of any product is the quality of the product. While choosing a garment following steps should be kept in mind:

  • Color Bleeding Test - For the color bleeding test cloth is washed for 60 mins in 60-degree temperature water if the cloth loses it color cloth is rejected and on the other hand if it is OK then it is selected.
  • Shrinkage - When we buy clothes sometimes after the first wash the clothes get shrink, for avoiding shrinkage cloth dimension is first being noted and then washed if the size of the cloth gets shrink then it is is rejected and if the size is the same then it's selected. The quality comes under control after this test.
  • Pilling - You might have seen some type of wool balls coming out especially on woolen clothes to check this La'Scoot uses the pilling machine so that the quality of the cloth can be predicted first only.
  • Slippage - In this, the cloth is of two types (i) Low thread count (ii) High thread count, if the cloth is of low thread count then it gets torn away very soon and easily. A low-quality cloth producing company will use a single needle machine and on the other hand, a high-quality cloth producing company double needle or chain stitch machine.

3. Distribution Innovation 

Once the garments are being manufactured the next step is to give the stock to retailers and motivate them to sell those products so that we can also grow. The burning problem of a distributor is that they are not able to stock goods, a huge amount of investment is being invested and they have to maintain a big warehouse.

How this problem is being solved? Let's understand it with an example:

If the La'Scoot is in Delhi and the distributor is in Lucknow and the retailer is in Meerut. Then La'Scoot has to send the clothes from Delhi to Lucknow and the distributor will send them from Lucknow to Meerut. Delhi and Meerut are nearby but still, they have to through a long way and resulted in the wasting of time, power and money. La'Scoot solved this problem by directly transferring the goods to Meerut saving the time, money and power of retailer and manufacture. The first manufacture had to purchase a large amount of stock but now with this La'Scoot technology if a retailer wants only 4 pieces of clothes then also they will send it to the retailer.

They did this with the help of technology innovation:
  • Technology Enabling
  • Mobile App
  • ERP Solutions
  • Supply Chain
  • Courier Services

4. Affordable designer wear with economies of scale

Affordable and designer can never be together, they are like east and west.  Affordable is what comes in budget but its look is not good and on the other hand designer garments looks are very nice but the price is too high. La'Scoot found the solution for this problem by doing the production in bulk and reducing the price of the garment. The following 3 factors are not stable at the same point in time:
  • Time 
  • Cost
  • Quality
With the use of ERP La'Scoot used the following benefits:
  1. Scalability
  2. Real-Time Data on software
  3. Accuracy
  4. No Time-Loss
  5. Forecasting
  6. Operation cost Controlled

5. Exclusive Brand Outlet

La'Scoot is now opening their band outlets, the franchise is regularly contacting them to opening their franchise. The tagline of the company is a celebrity of celebration. Every person wants to be a celebrity at a low cost. Our country is full of festivals every occasion have a different style of outfits. They are going to open 100 franchise stores only with the help of franchise, again fly-light known as asset-light. If your procedure, technology, manpower, back-end, supply chain and logistics are strong then you can easily run your franchise business.

Hope you would have understood how you can also earn crores in low investment. Comment below if you have any other queries. Thank You