Saturday, May 28, 2022

Pakistan's Global Fashion Brands Creating Other Branded Exports Opportunities

Pakistan is moving to higher value-addition in textile sector with branding. Khaadi, Gul Ahmed, J. by Junaid Jamshed, Sapphire, Sana Safinaz and others growing into global brands by expanding into countries with large Pakistani diaspora. Other Pakistani companies that have gained international brand recognition include Shan Masala, Pakola, Tapal Tea and K&N Frozen Foods. These companies are helping boost much needed exports to narrow Pakistan's growing current account deficits

Pakistani Global Brands. Source: Pakistan & Gulf Economist

As the Pakistani diaspora has grown to nearly 10 million in recent years, several Pakistani clothing and food brands have entered markets in the United States, United Kingdom, European Union and the Middle East. These markets create opportunities to build more Pakistani global brands, create jobs and grow Pakistan's exports

Khaadi Store, Package Mall, Lahore, Source: Wikimedia

Khaadi, which specializes in women's apparel, has attracted $25 million investment from International Finance Corporation (IFC) to help the company expand its business, create jobs, promote gender equality, and support the country’s crucial textiles sector after the COVID pandemic. Khaadi has established country-specific online stores for Canada, EU, Qatar, UAE, UK, US and Pakistan. In addition, the company has 57 physical retail outlets across Pakistan, UK and GCC countries. Investment Monitor, one of a network of 30+ proprietary B2B websites, has acknowledged the potential for Pakistani fashion brands in the following words:

"Despite its difficulties, Pakistan does have strong and innovative manufacturers, notably those developing their own apparel brands have emerged. Some of this has been based on advances in the Pakistan production of fine weave lawn cloth. And Pakistan consumers are becoming more brand conscious, being happy to seek out and wear local labels. Apparel brands, such as Khaadi (of Karachi); Sapphire (Lahore) and Sana Safinaz (Karachi), have focused on value addition and with Pakistan consumers prepared to pay for local quality, high profits have followed, including by developing exports".  

K&N Foods, a Pakistani branded poultry company, has recently started a poultry processing plant in New York. The company will sell Halal chicken products in the United States and Canada under the brand name of “K&N's Foods USA, LLC”. Beginning in the spring of 2013, the company invested more than $5 million in the purchase and renovation of a former Birds Eye plant which will employ almost 200 people in the Fulton area. Initially, K&N will focus on value-added processing of poultry purchased from other slaughter plants. The target market for these products will be specialty ethnic stores, supermarkets, and food service operations. 

Brands add value to the product being sold. This added value is effectively the difference between a product's price to consumers and the cost of producing it. Value can be added in several different ways, such as adding and promoting a brand name to a generic product or assembling a product in an innovative way. Brand marketing is done to create a consumer preference based on actual or perceived features or quality of what they buy from the store shelves. 

Developing countries like Pakistan manufacture products like ready-made garments for brand-name companies like Nike, Adidas, Levy's, etc. These garments are sold at a huge mark-up in the United States, and only tiny fraction of the money goes to Pakistan. 

Another global sector dominated by Pakistani manufacturers is surgical instruments. These precision instruments are sold by German companies under German labels with no mention of them having been made in Pakistan. Bulk of the money earned by selling goes goes into the pockets of German companies whose brand names appear on these surgical instruments. 

Manufacturers can earn much more by either building their own brands by spending a lot of money over a long time on advertising and marketing or by acquiring existing brands. Chinese manufacturers have been both in recent years to claim a much bigger share of profits generated by selling their products. Pakistani manufacturers can learn from the Chinese experience to do the same.

Related Links:

Haq's Musings

South Asia Investor Review

European Union: Fastest Growing Source of Remittances to Pakistan

Pakistani-Americans: Young, Well-educated and Prosperous

Ready-Made-Garments/Textile Boom in Pakistan

Fashion Week Karachi 2016

Pakistani Halal Meat Industry Experiencing Strong Growth

Over Half A Million Pakistanis Migrating Overseas Each Year

Pakistan Most Urbanized in South Asia

Pakistan Forecast to Become World's 7th Largest Consumer Market By 2030

Amazon Expands Pakistani Exports Opportunities


Ahmed said...

Dear Sir

How are these German companies exporting the Pakistani made products like surgical instruments to other countries by putting its label on it ? Who is supplying these German companies all these surgical instruments from Pakistan ?

Is Pakistani government aware of all this ? Are they aware of how much Pakistan is loosing because of this and how much it effect the economy of the country ?

Riaz Haq said...

How to buy a sari in Lahore
Pakistani sari enthusiasts have created thriving online marketplaces, reviving interest in a garment more often associated with India.

Three years ago, Aiza Hussain was wandering through Lahore’s crowded bazaars looking for a sari. Then a 22-year-old college student, she wanted something that didn’t cost too much, but was glitzy enough to wear at an evening event. She was out of luck.

Saris aren’t commonly worn casually in Pakistan, with middle-class women generally preferring the shalwar kameez (a tunic and trouser set) to the up to nine yards of pleated-and-draped fabric that is more commonly associated with India — and stigmatized, due to the historic conflicts between India and Pakistan. Most saris sold in Pakistan are imported from overseas, and retailers add a huge mark-up on their goods.

“Everything was so expensive, upwards of 15,000 to 20,000 rupees ($71-95),” Hussain told Rest of World. With the additional costs — including purchasing a matching blouse, a petticoat or underskirt, and a fall attachment, plus paying for the fabric to be dyed and pleats to be stitched — the total cost came to around 30,000 rupees ($145), which was far beyond her budget.

Hussain took matters into her own hands. She contacted wholesalers in Lahore who were importing saris from India, Sri Lanka, and Bangladesh, and began to sell the garments on Facebook — at first to a group made up of women from her college in Lahore, and later to a growing community of sari enthusiasts looking for affordable items. In December 2019, she launched her own website, The Saari Girl, a one-stop online shop for saris (paraphernalia and stitching included upon request). With prices starting at around 5,550 rupees (about $26), The Saari Girl’s tagline is “normalizing saris in Pakistan.”

In the past few years, several other online sari retailers have popped up in Pakistan, including Lahore-based Saareeka and Karachi-based Haseen Saree by Sidra. Lahore-based writer and sari aficionado Mina Malik-Hussain, 38, who claims to own at least 80 saris, is thrilled. “The mindset around sari-wearing is changing, and I do think supply is informing demand,” Malik-Hussain told Rest of World. “The sari is no longer a fancy Banarsi number you only wear at weddings, because you can buy a cute cotton one for a quarter of the price and wear it with a peplum [blouse] you already have.”

She said that Instagram has helped enormously, by creating access to ideas and innovations in the sari-wearing community.

Zarlasht Qadir Khan, a 33-year-old sari enthusiast from Lahore, runs an Instagram page, Hijabi Mama in Saarees, where she posts and reviews saris she has purchased online. Mostly, the comments are from other sari fans – encouraging her sari-wearing pursuits and peppering her with heart emojis – but sometimes, she’ll find a comment or two berating her for promoting a “foreign” culture. “It’s really strange,” she told Rest of World. “People tend to associate the sari with India or Hinduism, and the hijab with Muslims.”

Khan dons both – a sari as well as a hijab. She credits online retailers such as The Saari Girl and Saareeka for encouraging her to take the plunge towards wearing saris casually – a soft cotton number worn to lunch with friends, or a breezy ajrak (made from block-printed cloth) draped hastily before picking her children up from school. “Unlike a shalwar kameez – whose style and length changes season after season – a sari is timeless and affordable,” Khan said. “A cotton sari bought from an online retailer usually ranges between 5,000 and 6,500 rupees [$24-31] — roughly the same cost as a shalwar kameez.”

Riaz Haq said...

What Makes a Pakistani Brand Iconic?

Twenty-four percent of the respondents named Shan, followed by Khaadi and Rooh Afza (21% each), Tapal (19%) and Dalda and Pakola (10% each). (Other popular brands included Coke Studio, HBL, MoltyFoam, National Foods and Sooper.) With the exception of Khaadi, all these brands are FMCGs. And except for Shan and Khaadi (they were established in 1981 and 1998 respectively), they have been around for as long as Pakistan has existed, give or take a few years. Rooh Afza was established before Partition, Tapal and Dalda in 1947 and Pakola in 1950 followed by Dalda in 1952. The fact that these six are among Pakistan’s oldest brands may have to do with their popularity.

Iconic Now, Never or Soon?
However, another observation is the fact that as far as both questions are concerned, there was no big winner that captured over 30% of the responses, let alone a large majority (over 60%). Furthermore, two of the brands described as iconic in our first question – Shan (24%) and Khaadi (21%) – were also thought to have the potential to be iconic in the future (question two) by 14% and 13% respectively. Similarly, Tapal was considered iconic by 19% while six percent of the respondents thought it could be iconic in the future. These correlations indicate that agency and corporate heads are not obviously in consensus when it comes to naming iconic or emerging brands, as well as the fact that perhaps products, rather than brands, are dominating the landscape. Atiya Zaidi, MD & ECD, BBDO Pakistan, opines, “Instead of brands, I would say the two most iconic products to come out of Pakistan are Pakola and Rooh Afza. It is ironic that both are still products and never focused much on brand building. A huge opportunity is there for both to work on brand love and be relevant to the times.”

A Lack of Consistency – The Hallmark of Any Great Brand
Aurora also spoke to several advertising and marketing professionals and many of them, who spoke off the record, were not surprised that no brand emerged as a ‘big winner’ and attributed this to a lack of consistency in their messaging. This, in turn, brought forth another set of factors. One of them was the fact that for many organisations, the priority seems to be increasing sales and revenue rather than building brand love. However, shouldn’t it be the priority? Uncountable studies have shown the relationship between brand love and recall and sales. As Sheikh Adil Hussain states in What Makes a Pakistani Brand?, “Les Binet and Peter Fields in The Long and Short of It, talk about the 60:40 Principle, which says 60% of spending should go on long-term brand building and 40% on short-term tactics, which will result in better sales performance.”

Another factor to emerge is a lack of brand custodians on the agency and clientside – in other words, “marketing leadership” – who understand the brand’s ethos and want it to remain consistent. This could be because professionals on both sides hop frequently and replicate the ideas they already used at their previous organisation without keeping in mind the brand’s ethos and values.