Karnataka: Customers in New Delhi and Mumbai may not have heard of them, but jeans brands with names such as Nasty, Point Blank, Hotline, Pierre Bellari, Power and Reporter are popular across small towns in South and Central India and even among people from the lower income groups in Bangalore and Hyderabad. Almost all the brands—if Pierre Bellari didn’t give a clue—come from the hot, dry and dusty Bellary district of Karnataka.
Bellary, 500km north-west of Bangalore, was once a British cantonment that cut its teeth in the apparel business stitching British army uniforms. Today, this legacy manifests itself in jeans—scores of small units in the town churn out around one million pairs of jeans a year.
Lucky M. Shah, secretary of the local Garments Manufacturers Association and a merchant manufacturer, says the companies in Bellary are now investing in building brands.
In India’s apparel business circles, however, Bellary is usally spoken of with disdain, as a hub for low-cost and low-quality jeans. Consequently, profit margins too, are low.
Many of the companies in the jeans business in Bellary are traders or merchant manufacturers as they are termed. These companies do not have manufacturing operations of their own, and outsource this function to multiple small contractors.
However, Lucky M. Shah, secretary of the local Garments Manufacturers Association, and a merchant manufacturer himself, says companies such as his are trying to move away from this model.
“We are now investing in building brands,” says Shah, who runs Ashwin Dresses and owns Nasty, a brand of jeans that he claims is popular in Hyderabad.
The Garments Manufacturers Association of Bellary has 250 members, and most of them are traders. The association is also encouraging its members to invest in brands and manufacturing operations.
Contractors, who get work from traders such as Shah, make the jeans in small sheds that house 5-20 machines. Most of the people working these machines are employed only during the festival season, June to February, and work on an average for 12 hours a day, on daily wages between Rs80 and Rs120.
Three out of four jeans made in Bellary are sold in outlets across South India with the rest being sold in states such as Orissa, Madhya Pradesh and Gujarat.
There is little quality control and, according to Sankara Moorthi, a former expert from United Nations Industrial Development Organization (Unido)—a specialized UN agency that works in the area of industrial development—who advised companies in the Bellary jeans cluster between 2003 and 2005, “there is no quality awareness; nor do they (these companies) stick to delivery schedules.”
“A pair of good quality Bellary jeans earns, on average, Rs150 lower than a similar one made in Bangalore,” says Moorthi, now a senior technical adviser at Apex Cluster Development Services Pvt. Ltd, a company that advises industrial clusters in the country.
The local industry in Bangalore, a major exporter of high margin garments to large retail stores such as those run by GAP Inc., produces jeans that it sells at more than Rs800 a pair. Currently, most of the Bellary jeans are priced under Rs350.
“(The) Bulk of jeans sold (in the country) is between these two bands. They (Bellary’s jeans makers) should focus on this,” says Moorthi.
Some companies have already hopped on to the brand bandwagon and are investing in integrated factories in an effort to control quality better. Mutha Dresses, which owns the brand Walker and is among the largest garment makers in Bellary, and four of its associate companies are investing Rs3 crore in a factory that will produce 600,000 pairs of jeans a year, almost thrice the number these companies currently get made through contractors.
Umed Mutha, the eldest of the six brothers who run the firm, says margins would improve by one third due to efficiencies of scale and better quality control. “We can earn Rs100 more for each pair ...(through automation),” he adds.
The association says close to 20 firms have expressed interest in investing in their own factories and build their own brands to earn better margins.
“Nearly 90% of the jeans (currently) are stitched by contractors; in two years, our factories will stitch 90% (of them),” says Shah.
The association claims nearly 100,000 people work in the Bellary cluster, and that the jeans business is the second largest employer in the backward district. Bellary’s iron ore mines employ an estimated 1.5 lakh people. The district is also home to the Hampi ruins, a world heritage destination.
Aslam Basha, the 46-year-old joint secretary of Bellary’s Garment Makers Association says that if new factories come up, the current lot of tailors may lose their jobs as they may find it tough to shift to a new environment.
Their forefathers adapted in the past when the orders from the British imperial army for uniforms stopped. Bellary’s jeans makers will be hoping that they will be able to reinvent themselves a second time.