International Marketing
Khaadi is one of the leading textile industry and many outlets in different cities of Pakistan and
UAE. Khaadi made a mark not in the local but in the international market with its unique
products and use of exquisite colors and textures, making it the most sought after brand. We are
going to introduce khaadi in QATAR.
Marketing Plan
I-EXECUTIVE SUMMARY:
Khaadi is a Pakistani multinational luxury fashion house founded by the fashion designer,
Shamoon Sultan in 1998. Khaadi whose literal meaning is hand-woven first opened its stores in
Karachi, Pakistan. Like its name it specializes in "hand-woven" technique. Its products include
unstitched lawn, menswear, luxury Prét, children’s clothing, shoes, bags and jewelry. Khaadi
have more than 40 stores in Pakistan.
Khaadi aims to bring waves of change in the fashion industry by promoting our traditions and
redefining the khaddar culture. It wants to become one of the most renowned multinational
brand. In 2010, Khaadi expanded internationally by opening its doors in the United Arab
Emirates, first in Dubai and later in Abu Dhabi. In 2013, stores opened in Kuala Lumpur,
Malaysia and London, England. The company continues on its aggressive expansion strategy by
opening several retail stores in smaller cities of Pakistan. The online store was launched in
Pakistan in 2014 and Khaadi will look to open its digital doors to various countries throughout
the year.
Khaadi remains a completely equity-based business. Initial capital of Khaadi was Rs3 million,
which have grown over the years. The creative enterprise of Khaadi is now sustaining nearly
$100 million in annual sales. It is one of the most successful retail brand in Pakistan.
Khaadi continuing its expansion strategy intends to open a retail outlet in Qatar. Pakistan and
Qatar have very sound bilateral ties. There is more than 50,000 of Pakistani population living in
Qatar. Khaadi also seeks to cater Indians, Pakistanis, Nepalis, Filipinos and Qatari Arabs who
don’t prefer western clothing. Pakistanis and Indians have almost a similar taste in dressing and
they make up a major population in Qatar so there is a huge market potential in Qatar.
Khaadi will export from Pakistan through sea and air to Qatar. Khaadi will position itself in the
minds of the customers on the basis of its exceptional merchandise on product differentiation.
It’ll will offer its signature hand-woven stitched and unstitched garments for both men and
women. Other than that it will provide home textile and a vast range of beautiful accessories. It
will promote its product by participating in trade exhibitions, advertising in the top magazines of
Qatar, billboards and internet.
The prices of Khaadi’s products will be optimum. As Khaadi wants to cater the people of Qatar
and for entry in Qatar market, Khaadi will use market skimming pricing strategy and charge a
premium price since Khaadi is introducing itself in a new market and it is at the introduction
stage of product life cycle. The incomes of people of Qatar are high and demand is limited to
innovators and early adopters who are willing and able to pay the price. This price both
maximizes revenue on limited volume and matches demand to available supply. If initial sales
are high then Khaadi will continue its business and if sales are low then Khaadi may wind up its
business.
II. OVERVIEW OF THE FIRM MARKETING
THE PRODUCT
Introduction and History
Khaadi was founded by Shamoon Sultan. He started Khaadi on December 13, 1998 with
one small 400 square foot store in Zamzama. Shamoon was a textile graduate from Indus
Valley and he didn’t know what else to do. He worked for textile companies and went to
India a couple of times where he saw a lot of craft promoted through retail. There was
absolutely nothing of the sort in Pakistan so he thought of introducing it in Pakistan.
The inspiration behind khadi was the traditional hand-making clothes. It primarily sold
fabric, menswear and some very basic kurtis for women.
From a small number of weavers, Khaadi has now expanded manifold, with numerous
able hands crafting a wide array of products. Khaadi has its own dyeing unit, where all
the griege thread is dyed to keep the quality of the thread upto the mark. Khaadi has an
in-house stitching unit as well, which facilitates the designers to create new designs in the
products. Khaadi has a fully equipped design studio, with a team of highly trained
designers, who make sure they bring out the best in their work, in order to make their
products stand out. Khaadi has five shops in three major cities of Pakistan, making it the
only brand which offers hand-woven fabric and other products nationwide.
Geographical Growth:
Khaadi currently has over 35 outlets in Pakistan. Every store features a similarly designed
wooden floors and light colored walls. It opened its first store in Karachi, Zamzama and
then in Lahore and other cities. Latest, a 22,000-square-feet Khaadi store was opened at
Karachi’s Dolmen Mall Clifton In 2010, Khaadi expanded internationally by opening its
doors in the United Arab Emirates, first in Dubai and later in Abu Dhabi. In 2013, stores
opened in Kuala Lumpur, Malaysia and London, England. In 2014, Khaadi opened a
store at the Bullring shopping centre in Birmingham, UK.
The online store was launched in Pakistan in 2014 and Khaadi is looking forward to open
its digital doors to various countries throughout the year.
Fiscal Growth:
In 1998 when Khaadi was first opened. Khaadi had small investment and a small shop
with few customers but as the time passed Khaadi continued its investments in clothes
and made a bigger outlet becoming popular among people. Today khaadi is one of the
leading clothing brand of Pakistan.
As of now, Khaadi has zero debt; khadi has kept it a completely equity-based business.
Initial capital was Rs3 million, which have grown over the years. The creative enterprise
of Khaadi is now sustaining nearly $100 million in annual sales.
Core Business:
Design and retail – that's the direction for the Khaadi of the future. Three to four years
ago, Khaadi used to manufacture everything it sold. Today Khaadi is producing about 20-
30 percent of what it sells. The idea is to produce no more than 5 percent of what khaadi
sells. It has to be a complete-sourcing model. So Khaadi will do retailing.
Physical Resources:
Physical resourcing such as land, capital, equipments and raw materials needed to make
final product is done in Pakistan. Finishesd products are made Masood textile mills in
Faisalabad and will continue to me made in Pakistan. Extra production is done to export
Khaadi clothes to other countries.
Current markets
served Reputation:
Khaadi is one of the leading apparel brand of Pakistan at the moment which never fails to meet
the customer’s requirement. The quality of apparels provided are top notch and are made
available at a reasonable price. The colors and designs are unique and beautiful at the same time.
Market Share and Market Positioning:
Khaadi currently has 38 outlets across Pakistan. Khaadi is in 14 cities at the moment but the plan
is to go into at least 50 cities of Pakistan. Every store features a similarly designed wooden floors
and light colored walls. Khaadi expanded internationally by opening its doors in the countries
like, Dubai, England, Abu-Dhabi and Malaysia.
Along with that khadi provides online services to Australia, Canada, mexico, india, Saudi Arab
and America. The products made by Khaadi were introduced in the market as a new fashion
trend. Today Khaadi has become the latest fashion trend in these countries. Khaadi is now
grabbing the unoccupied market. Khaadi plans to open a store in mall that will cater to a wider
market. In an interview the owner of khadi said that he plans to open 1200-1500 stores across the
world.
Competitive Advantage:
Khaadi can be described as a specialty store since it focuses on one type of
merchandise i.e. khaddar. Also it provides unique designs for lawns. Their competitive
advantage is their new range of products, which are handwoven and act as a base line for
creating a product differentiation. They have now shifted to cater to other target consumers by
including children wear, men’s wear, bed linen, table linen and other accessories made available
at an affordable price. Khaadi also came up with Khaadi Khaas for formal wears.
Mission of Khaadi: "To bring waves of change in the fashion industry by promoting our
traditions and redefining the khaddar culture."
Vision of Khaadi: Shamoon Sultan said “My dream is to make Khaadi a multinational –
completely process-driven and completely professional-led. Khaadi will be the first Pakistani
brand to actually go global – we have the potential to go and create history
Goals:
Khaadi has a budget for every assignment and design briefs are made accordingly. Initial
investment capital was Rs.3million. The creative enterprise of Khaadi is now sustaining nearly
$100 million in annual sales.
a) Domestic:
Customers' expectations should be fulfilled and their orders must be serviced promptly
and accurately.
We are responsible to the communities in which we work and to the world community as
well.
We must experiment with new ideas.
We must provide competent management and their actions must be just and ethical.
We must constantly strive to reduce our costs in order to maintain reasonable prices.
Business must make a sound profit.
b) For Qatar:
Same goals for Qatar as mentioned above. In addition Shamoon Sultan said:
“When you go international, you need to cater to international requirements. We will
keep the more ethnic, Pakistani stuff but we will also have fusion clothing.”
By this he meant Khaadi will make clothes according to the tastes of people of Qatar as
well.
Description of specific goods/services to be marketed:
It specializes in "hand-woven" technique, products include unstitched lawn, menswear, luxury
Prét, children’s clothing, shoes, bags and jewelry. Khaadi (literally "hand-woven") is a Pakistani
multinational luxury fashion house.
The real difference right now is the pricing strategy, the retail experience that Khaadi gives and
its designs.
RETAIL MARKETING STRATEGIES:
Organic retail strategy:
Khaadi will use its own resources to open an outlet of its own in Qatar. Clothes from Pakistan
will be exported through sea or air and company will bear the expenses.
Store Positioning:
Khaadi has positioned itself in the minds of the customers on the basis of its exceptional
merchandise on product differentiation and on the range of services it offers. It is positioned as
an outlet which is "Redefining khaddar to meet the needs of the contemporary customers."
It aims to sustain old customers and attract new ones by the wide variety of exceptional quality
and unique designs. They claim to be producing hand-woven material from finer quality threads,
which act as the basis of product differentiation for their outlet. The outlet has maintained their
exceptional quality and the management is always trying to bring in new varieties and designs of
their merchandise keeping in mind their customer's taste and also following the concept of
regional harmonization.
Therefore Khaadi is planning to open the outlet where the there is potential for maximum
customers like malls etc.
Positioning:
Khaadi will be giving a pictured advertisements in Qatar’s weekly magazine which will have a
high frequency and sale. An Advert in Qatar’s top magazine that is mostly read by people can
help Khaadi to make it a well-known clothing brand in the marketplace as it will create a recall
and awareness about a quality of clothes available in market at good price.
Retail Marketing Mix
Retail marketing mix of Khaadi consists of the following elements:
Product Offering Garments (Men's Wear + Women's Wear): Khaadi has a large
variety of stitched and unstitched garments both for men and women, such as
kurtas, dupattas, casual shirts and other products. Khaadi only works with natural
fibers such as cotton and silk.
Khaadi Home: Khaadi offers a beautiful range of bed covers, table linen,
cushions, floor rugs and other products related to home-textiles.
Khaadi Accessories: Khaadi also offers a vast range of accessories. Beautiful
pouches, hand bags, folders, note books, photo albums etc., are all made out of
excess material.
III. MARKET ANALYSIS
Pakistan–Qatar relations refer to the bilateral links between the Islamic Republic of Pakistan and
the State of Qatar. Pakistan has an embassy in Doha; Qatar maintains an embassy in Islamabad
and a consulate-general in Karachi. Relations between the two are shaped by Pakistan's generally
close relations with the Arab world. Like other nearby gulf-states, there is a large Pakistani
community in Qatar which numbers over 50,000. They work in diverse fields and send
remittances each year. Diplomatic relations between Pakistan and Qatar have been established.
Market Description
Size of Potential Market for Khaadi:
There is a lot of Market potential for Khaadi in Qatar. In 2014, Qatar has an estimated
population of 2.27 million among which Qatari Arabs who usually wears western clothes,
only make up 15 %. Others include Indians, Pakistanis, Nepalis, Filipinos etc. as, Pakistanis
and Indians have almost a similar taste in dressing and they make up a major population in
Qatar so there is a huge market potential in Qatar.
Moreover, the local dresses available for Pakistanis and Indians are very expensive and rarely
available.
Profile of the prospective buyers of Khaadi in Qatar:
The Buyers who will buy our product will be Pakistanis who make up 50 000 of the
population of Qatar as well as Indians who make up a big portion of Qatar population.
These buyers who live far away from their homeland have a tendency to follow their
local fashions. They wanted to wear their local dresses so that they can preserve their
identity. Unfortunately for these buyers there is not much options available for them.
Consumption characteristics of people of Qatar:
Qatari consumers have amongst the highest incomes in the world but they must deal with
a high and growing cost of living. Nevertheless, consumer spending continues to
increase. Close to 85% of the population are expats and this has influenced the products
on offer in many retail establishments. Demand for luxury products continues to grow
based on their popularity amongst Qatari nationals.
Consumer confidence (and spending) remains very high so if we launch Khaadi there
then people of Qatar would spend on the unique products of Khaadi.
Consumers’ appetite for luxury goods grows and people would look for new features in
clothes to look trendy and Khaadi would provide that kind of satisfaction to the
customers.
Internet retailing still in its infancy that is why we need a retail store there and we cannot
just rely on online retailing.
Cost of living rises fuelled by high rental rates so people need something which is
affordable and unique as well. Affordability is a unique selling proposition of Khaadi.
Market trends for this or related products
Qatar is an Islamic country, and people dress in a very traditional manner. Foreigners are
also required to dress in a conservative manner, no shorts for men and no miniskirts for
women are allowed. People from different nationalities usually follow their home country
dress code.
As Pakistan and India has almost a similar taste so they follow their home country culture
and traditions. Especially the cultural festivals like Eid and diwali. The need for their
traditional clothes rises to the peak.
Relevant data on Communications and Transportation Data
Cars, trucks and railways have no access to Qatar, only air transportation is a mean of
traveling in this area. Ships are also a mode of travel but it takes a lot of time.
1) It takes approximately 2.07 hours to reach Qatar from Pakistan if an aeroplane is
traveling with an average speed of 560miles/h. The air travel (bird fly) shortest
distance from Pakistan to Qatar is 1867.87 km= 1160.64 miles.
Two shipping route to Doha (Qatar) are as follows,
2) Combined freight rate index: 8 335, transit time estimate: 5 days, CO2 emission
index: 4 673
Karachi (origin) - Doha (destination)
3) Combined freight rate index: 2 131, transit time estimate: 6.6 days, CO2 emission
index: 477.
Karachi (origin) - Karachi port
Karachi port - Umm Said (Mesaieed) port
Umm Said (Mesaieed) port - Doha (destination)
4) Q-post (Qatar post) is their domestic and international mailing service
Competition
Domestic:
There is hardly any company that is producing a similar product like Khaadi. There is
though, a retail store named as ‘Todays fashion’ that sells many brands like khaadi, e-g, Al-
Karam, etc. and many Indian and western brands as well but there is no Pakistani brand in
Qatar that have its separate retail store.
Foreign:
Yes there are few foreign and global competitors in Qatar like,
1-Parthas-Sells Indian saarees, men and women garments etc.
2 -LuLu-Located in Doha also sell indian clothes.
3 -MERCH TRADING CO
4- DANA CENTRE
5- MODERN READY MADE
6-DULHAN
7 -BOMBAY SILK CENTRE
8-MR PRICE
9-AL MANDOOS INTERNATIONAL
10-SAFARI EXPORT CO.
IV. OPERATIONAL PLAN
Marketing Orientation
Khaadi will go for globalization with a slight localization. Product quality, materials, promotion
strategies will be globalized but there will be some changes in pricing strategies. Khaadi will
offer a mix of styles – a lot like the Khaadi collections we see in Pakistan. Eastern clothes will be
focused more.
Khaadi existing outlets are usually located in those areas which have high customer traffic of
high-income people. These outlets are all situated in busy areas with an array of other retail
stores. All these stores have high rentals because of their location, and are based on high-street
formats. The store that we will open in Qatar will be located in a big mall and place will be
rented out to Khaadi.
Promotion:
Promotional Strategy:
1) We will market Khaadi by participating in trade exhibitions. International Trade
promotion Offer(ITPO) organizes various exhibitions and participation in such reputed fairs will
promote Khaadi globally.
2) Using a global web strategy is one of the best ways to initiate or extend export activities.
with the web. Excessive promotion with the help of electronic media i.e. via internet will lead to
awareness of Khaadi brand in Qatar.
3) Khaadi store will be designed in such a way that when you enter into a Khaadi store, the
experience would be the same as of any other Khaadi store.
4) When going global, Khaadi will participate in fashion trade shows which will lead to an
interaction between the Khaadi brand and its potential customers. These trade shows are a
platform where brands from all over the world meet and buyers get to know about brands and
this way Khaadi’s brand popularity will increase.
5) Khaadi will rent out few billboards in the most populous areas of the city of Qatar where
Khaadi store will be located.
6) Khaadi strongly believes in the concept of personal selling. Sales and service people
employed at the outlets will communicate the value proposition of the entire shop. Well-trained
sales people will advertise the shop by their extra ordinary selling and service skills. They will be
aware of their customers’ needs and preferences, therefore, will be able to make suggestions and
then finally persuade them into buying a certain item.
Distribution:
IMPORT AGENT: Khaadi will make use of a Qatar based website which is importers.com.
Importers.com powers the international companies by providing trade leads that help Qatar
importers and exporters to develop buyer seller relationships. Khaadi will contact an agent
through this website. This agent is “Mubarak Enterprises” which is a prime supplier of textiles
and garments.
Contact JAHANGIR UDDIN
Business Role: Importer
Business Type: Buying Office
Business Status: Corporation/LLC(Limited Liability Company)
BRANCH: The branch of Khaadi in Qatar will have a backroom for storage of good, a sales
department for taking into account the sales of store, accounting department for calculating the
expenses and revenues and a main room or floor where all Khaadi products will be displayed for
customers. Khaadi will hire employees to run the store, attract more customers and keep a record
of products and sales and revenues.
Pricing:
The prices of our products will be optimum. Since Khaadi wants to cater the people of Qatar
and for entry in Qatar market, khaadi will use market skimming pricing strategy because at
this point in time khaadi is introducing itself in a new market and it is at the introduction stage
of product life cycle so Khaadi will charge a premium price. Khaadi will deliberately set a
high price because the incomes of people of Qatar are high and demand is limited to
innovators and early adopters who are willing and able to pay the price. This price both
maximizes revenue on limited volume and matches demand to available supply. And through
market skimming pricing strategy, Khaadi will be able to know that how consumers respond
to our products in Qatar. If initial sales are high then Khaadi will continue its business and if
sales are low then Khaadi may wind up its business.
Since the product is being launched in the international market so we will take into account
the global pricing and we will go for adaption. This is a polycentric approach that Khaadi is
going to use. Those prices will be set that are most desirable in this circumstance i.e. the
prices of our competitors are very high so we will also set slightly higher prices to match our
competitors’ prices. The charges will go high up to 55% - 60% taking into consideration all
the transportation, retail markups, tariffs, licensing fees, franchise fees, promotional fees and
other charges as per rules & regulation of other countries.
Transportation costs are not very high as the distance between Pakistan and Qatar is
less and Khaadi products manufactured in Pakistan will reach Qatar very quickly.
Charge too little, and you won't make enough to cover your costs. Charge too much,
and your customers will flock to your competitors. That makes the calculation for the
markup. Apparel markups are somewhat above the standard retail markup of two times
cost, which is known as keystone in the retail industry. Typical markup on clothing
ranges from 55 to 62 percent, so if the wholesale price of clothes similar to khaadi is
Rs1600 (QAR57) then Khaadi will set the price of same piece of cloth as Rs2500
(QAR86). This gives an idea of retail markup.
Qatar import tariff rate changes from time to time. All goods imported into Qatar are
subject to customs duties, based on a percentage value of goods (for general cargo it is
typically 5%), or a per unit basis. The value of goods is calculated according to the
Regulations under the Customs and Ports Law.
PRODUCT PRICE IN PRICE IN QATAR
PAKISTAN
Pret Eastern PKR2200-PKR5000 QAR118-QAR267
Pret Western PKR1800-PKR2400 QAR96-QAR129
Khaadi Khaas PKR4000-PKR5000 QAR214-QAR267
Khaadi Home PKR300-PKR6000 QAR17-QAR321
Khaadi Accessories PKR125-PKR4000 QAR8-QAR214
Khaadi Unstitched PKR1600-PKR7500 QAR85-QAR402
Khaadi Kids PKR450-PKR7500 QAR25-QAR402
E. Budget for first three years
Khaadi will have to bear the cost of production, pay the rent of store in a big mall of Qatar,
hiring of employees for running the store, transportation of goods and custom duties, and other
costs that will lead to approximately 20% rise in costs. So the estimated budget for entering a
new market of Qatar will be around Rs.2.5million i.e. 25 Lac Pakistani Rupees for the first year.
And the total estimated budget for first three years will be 10million.
