Project 2

Finlatics Investment Banking Experience Program Project 2
Sustainable Fashion Company
1. Among the five stages of the company life cycle, I believe the product of this
sustainable fashion company lies in ideation stage. In this stage Product is
launched in the market , Getting traction as positive response to limited launch
sales in niche-high end markets but yet to find perfect market product mix.
In first stage of commercialization investor invests on business plan or

entrepreneur as product is already launched in the market.
SWOT MATRIX
STRENGTHS WEAKNESS
 Wide product range.  Changing Fashion brands.

 Quality products.  3rd party suppliers.
 In house production.  Entering new markets.
 Independent operations.  More expensieve due to organic
 Zero dead stock. and eco friendly material.
OPPORTUNITIES THREAT
 Improvised Lifestyle.  High competition.

 Spendings on fashion products.  Changing trends.
 Fashion trends.  Established brands.
 Online shopping.
2. CHALLENGES TO FASHION INDUSTRY AND SOLUTION TO ELIMINATE

PROBLEMS.
A. Copycats & product counterfeiting
 Product counterfeiting is one of the biggest challenges facing fashion

brands today who want to grow and expand their business in international
markets.
 Big fashion brands have a big challenge. It’s hard to sell original high-
value products when everyone wants cheap knock-offs! According to a
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2022 piece by The Cut, counterfeit luxury bags have become more
popular than the real ones amongst a section of New York’s elite.
 Meanwhile, smaller brands (especially those selling online) are at risk
because they may not have the resources to stop counterfeits before they
hit the grey market. And once a fake product has gone into circulation, it
can be very difficult for people to tell whether it’s real or not.
SOLUTION
 Use NFT-based product passports to create unique digital tokens linked to

a specific product. These tokens can be used to authenticate the product,
making it difficult for counterfeiters to replicate or sell fake versions.
 Implement holographic labels and watermarks. These labels on product

packaging and tags can make it difficult for counterfeiters to replicate the
look of authentic products.
 Trademark important words or design elements, which makes it easier to

pursue legal action against those who try to copy you. You can further
protect your brand by working with trusted manufacturers who won’t
share your design with others or fudge on materials requirements and
specs.
Ultimately, don’t wait until someone has ripped off your product before you
protect it. Register your designs, trademarks, and patents as soon as they’re
ready—so that when they go on sale, they’re protected.
B. Inefficient supply chain & distribution
The fashion supply chain involves a highly fragmented network of

manufacturers, suppliers, retailers, and consumers. First, a fashion business has
to find the right fabrics and materials for the specific styles they want to create;
then they must identify a manufacturer who can turn those fabrics into garments
at a competitive cost.
Once manufactured, these garments have to be distributed across the globe for
sale in different markets. And let’s not forget returns! This product lifecycle can
include numerous subcontractors, each with their own specialty, who are
typically spread across the globe.
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The apparel production process involves a lot of capital up front—not only does
the brand have to invest funds into making its product line, but they must also
stock inventory without knowing how well those items will sell.
The lack of visibility into this complex network creates a lot of inefficiencies,
and ultimately results in products being delivered to the market late leading to
product failure.
SOLUTION
 Using a knowledge management platform like WFX PLM can help you

get realtime visibilityinto the entire product lifecycle, from design through pro
duction, allowing for betterforecasting and more informed decision–making.
 With all information organized in one place, ERP and PLM systems enable

better collaboration between departments and teams, allowing for the sharing
of data and ideas in a more efficient manner.
 These systems can also

automate many of the tedious and repetitive processes, thus freeingup time and
resources to focus on more important tasks.
 They also allow you track important information like delivery dates, order
quantities, shipping costs and more to ensure that everything stays on schedule
and nothing slips through the cracks.
As it stands, most companies are stuck in the past, relying on outdated methods
of supply chain and distribution that waste time and money. But these methods
can be solved with the right technology tools.
C. Adaption to changing consumer demands
In the fashion industry, diversity and inclusivity are crucial. When consumers
can see themselves and their values reflected in a fashion brand, they’re more
likely to identify with that brand and feel like it’s an extension of their own
self-expression.
The rise of fast fashion, D2C brands and accessible e-commerce platforms
have empowered consumers to demand more from their clothing: they want
to be able to choose the exact colour and fit of the pieces they buy.
Consumer centricity and personalization is mandatory for today’s fashion
brands. The fashion industry is waking up to this reality, but many brands are
still scratching their heads about how exactly to customize their business
3
models so that they can meet their customers’ demands for diversity and
inclusion—and boost their bottom line in the process.
SOLUTION
 Mass Customization: This approach begins with a range of options that

consumers can choose from, which allows for some level of personalization.
Like giving them options to choose for colour or certain design features.
 TotallyPersonalized: This approach allows for complete customization, also

known as bespoke tailoring, where consumers can control every aspect of
the product.
 Co-creation:This means allowing consumers to participate in the design

process and co-create with you. Take the example of Nike ID, where
customers get to put their own creative flair into product designs, with do-it-
yourself videos teaching people how to hack and customize their own
fashion items.
 Virtual fitting solutions: Getting the sizing right is an underrated

personalization feature. You can reduce returns and let customers find their
best fit with 3D virtual fitting rooms and try-on technologies.
MILESTONES
As company is in first stage of commercialization product is already launched in

market and having decent sale, After the product has commercialised, the
second milestone would be focused on expanding the market through aggressive
tie-ups. The product has touched the water and is ready to dive deep into the
market and grab its share.
Tapping the market is not enough, the product must also stick in the market.
Therefore, the following milestone considers multi-fold growth in the total
number of sales, customer retention, repeated purchases, high market market
share.
As an investor I would be evaluating whether business plan is scalable or not,

whether the company has a model to achieve sustainable customer life value
exceeds customer acquisition cost As it is important for long term profitability.
Whether model this model is replicated across geographies, demographics,

socio- economic class.
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CONVERSION RATES
INITIAL INVESTMENT MILESTONE(USERS) CONVERSION RATE
50,00,000 1,00,000 6%
50,00,000 75,000 9%
50,00,000 50,000 13%
50,00,000 25,000 18%
From the abovementioned, table, we have taken the total number of Customers
on as the milestone. The initial investment that we are looking to make in the
company is Rs. 50,00,000 and the time period of investment is 5 years. From
the table, we can see that the respective conversion rates that are applicable to
the investment and how they are range bound.
In the first case, the company took five years to complete projected milestone
(1,00,000) customers so the conversion rate would be 6%. In second case the
company achieved (75,000) customers milestone which is less than the
projected milestone to be achieved so the conversion rate would be higher hence
it increases to 9%. Same process follows in both the next milestones.
From this table we can conclude that there is a inverse relationship between
milestone and conversion rate. If the milestone increases the conversion rate
decreases vice-versa if milestone decreases conversion rate increases.
CUSTOMER LIFETIME VALUE AND CUSTOMER ACQUISTION ANALYSIS
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AVG. VALUE OF NO OF TIME TIME PERIOD CAC COST CUS. LIFETIME PROFITABILITY
CUSTOMER PURCHASE PURCHASE OF PURCHASE VALUE
2000 4 12 20000 8000 -12000

2000 8 24 0 16000 -4000
2000 12 36 0 24000 4000

2000 16 48 0 32000 12000
2000 20 60 0 40000 20000
The company incurs a Rs 20,000 acquisition cost per customer and earns Rs
8000 per customer to achieve milestone 1. As shown in the table above, the
company stops making losses year 3 onwards. This indicates that the business
needs to keep a customer loyal for at least 3 years in order to make some profit
on it.

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Finlatics Investment Banking Experience Program Project 2

Sustainable Fashion Company

In first stage of commercialization investor invests on business plan or

 Wide product range.  Changing Fashion brands.

 Improvised Lifestyle.  High competition.

2. CHALLENGES TO FASHION INDUSTRY AND SOLUTION TO ELIMINATE

A. Copycats & product counterfeiting

 Product counterfeiting is one of the biggest challenges facing fashion

 Use NFT-based product passports to create unique digital tokens linked to

 Implement holographic labels and watermarks. These labels on product

 Trademark important words or design elements, which makes it easier to

B. Inefficient supply chain & distribution

The fashion supply chain involves a highly fragmented network of

 Using a knowledge management platform like WFX PLM can help you

 With all information organized in one place, ERP and PLM systems enable

 These systems can also

C. Adaption to changing consumer demands

 Mass Customization: This approach begins with a range of options that

 TotallyPersonalized: This approach allows for complete customization, also

 Co-creation:This means allowing consumers to participate in the design

 Virtual fitting solutions: Getting the sizing right is an underrated

As company is in first stage of commercialization product is already launched in

As an investor I would be evaluating whether business plan is scalable or not,

Whether model this model is replicated across geographies, demographics,

INITIAL INVESTMENT MILESTONE(USERS) CONVERSION RATE

50,00,000 50,000 13%

50,00,000 25,000 18%

CUSTOMER LIFETIME VALUE AND CUSTOMER ACQUISTION ANALYSIS

2000 4 12 20000 8000 -12000

2000 12 36 0 24000 4000

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