We are simplifying the yarn-buying experience
The Yarn Bazaar (TYB) is at the forefront of revolutionising the Indian textile industry, offering a purpose-led marketplace facilitated by cutting-edge technology. Buyers and sellers can access real-time data on yarn prices, market trends, and information, ensuring transparency and efficiency in transactions. Speaking to Fibre2Fashion, Founder and CEO Pratik Gadia talks about the challenges of SMEs and how TYB addresses those.
How has the company’s platform changed the traditional way of buying and selling yarn?
The Yarn Bazaar serves as a one-stop yarn solution, offering a wide array of services, including discovery, quality control, transactions, fulfilment, financing, advisory, and market intelligence. This comprehensive approach eliminates the necessity for multiple intermediaries, be it for yarn procurement, sales, logistics, credit requirements, or market insights.
In the traditional yarn-buying process, buyers often face some challenges in the entire journey from pre-sales to post-sales. They must contact multiple suppliers to explore various options, and traders typically promote specific manufacturers’ products.
At The Yarn Bazaar, we are changing this narrative. Our approach is not one-size-fits-all; instead, we consider the unique machinery and fabric needs of each fabric manufacturer. This way, our recommendations are geared towards maximising the yarn efficiency for the buyer.
The result? Lower production costs, the ability to meet customer orders promptly, and heightened customer satisfaction. In some cases, we even suggest alternative yarn options that are more cost-effective while delivering the same fabric quality demanded by their customers.
At The Yarn Bazaar, we are simplifying the yarn-buying experience and helping our buyers achieve better outcomes, one recommendation at a time.
Can you describe the current market trends in the yarn industry, such as demand, pricing, and emerging markets?
The textile industry has undergone a major shift in the wake of the pandemic. The volatility of yarn prices has increased significantly, with prices fluctuating by ₹5-10 per kg, compared to ₹1-3 per kg in the past. The frequency of price volatility has also increased, with prices changing several times a day.
In addition, there has been a major shift in trends. The consumption of non-cotton yarns has increased and is expected to continue to do so. People are switching to blends or completely non-cotton products.
The high prices of yarn have also impacted demand. This has led to an increase in inventory holding costs. Hence, Buyers are not buying in bulk and are keeping lower inventory levels to control working capital requirements.
In addition, there is a massive demand for sustainable products. Buyers who were previously purchasing regular cotton yarns are now demanding BCI, Organic, Fair Trade, or GRS yarns.
How is the textile industry responding to the increasing demand for recycled and environmentally friendly yarn?
There has been a growing demand for sustainable yarns from global buyers and domestic brands. We have seen many of our buyers shift from regular cotton yarns to more sustainable options, such as BCI, organic, GRS, and recycled yarns. In the polyester segment, companies are investing heavily in increasing their capacity for recycled yarn.
Spinners are responding to this increased demand by investing in technology, supply chain, and traceability. They are working to source the right raw materials to meet the needs of their buyers. This is requiring spinners to rearrange their supply chains and production processes, and in some cases, invest in new capital equipment.
In this context, The Yarn Bazaar partnered with Wazir Advisors to undertake the Sustainability Survey Report 2023 on World Environment Day. This endeavour aims to illuminate the potential of the Indian textile industry and highlight the significant contributions of leading stakeholders in the pursuit of sustainability.
Can you share some insights into the proprietary processes that The Yarn Bazaar has developed?
At The Yarn Bazaar, we believe in customer success. We are obsessed with providing the best experience to all our buyers and suppliers. Our proprietary process is represented by TYB BANDHU, an advisory-first approach. It guides buyers on the right yarn quality and supplier selection based on their machinery and fabric needs. These recommendations are completely unbiased and ensure the growth of their business. Over time, this approach has consistently delivered substantial cost savings for our buyers while ensuring greater efficiency and on-time order fulfilment.
How does the BANDHU programme contribute to customer support and engagement?
It is unfortunate that customer satisfaction and experience are often overlooked in the Indian textile industry, with post-sales service receiving little attention. Our vision is to change this by introducing an advisory-first approach through our BANDHU programme.
BANDHU will offer recommendations, predictions, and prevention strategies for both our buyers and suppliers, ultimately delivering a superior customer experience. This includes comprehensive order tracking, traceability, live monitoring, and increased operational efficiency—all aimed at streamlining the entire sourcing and sales experience.
How are small and medium-sized enterprises (SMEs) in the textile industry adapting to the global market and competing with larger corporations?
We see this as a challenge. Smaller companies and SMEs often struggle to reach a large global buying base and provide the same confidence in terms of quality and delivery timelines. Large buyers and international buyers would always prefer to purchase from larger, established organisations because of the built-in trust and perception of quality and timely delivery.
We at TYB are working closely with SMEs to provide them with a larger market access through our platform. This will allow SMEs to get regular quantity orders and advance payment, levelling the field for all players, especially SMEs, to compete and get good yarn sales and payment on time.
How do you see the future of the textile industry, especially in the context of global economic fluctuations and changing consumer preferences?
The textile industry is here to stay. It is one of the basic necessities of human beings, and it is expected to grow at a decent CAGR. The application of technical textiles is increasing, and this is going to drive the demand for textiles. India has a large population with a young median age, and the per capita consumption of textiles is much lower than in other Western countries. This means that there is a lot of potential for growth in the Indian textile market.
The new consumers in the digital era and social media world are savvier about what they wear. They are less likely to repeat clothes. This is driving the demand for textiles at the fashion level.
How do you see The Yarn Bazaar’s role in organising the unorganised textile industry?
The textile industry in India is undeniably vast, contributing significantly to the economy and providing extensive employment opportunities. However, it is worth noting that a substantial portion of this industry, approximately 80 per cent, operates in an unorganised manner. This means that most of the contributions come from larger players.
Consider a small yarn manufacturer who often struggles with low capacity utilisation. We have observed similar challenges across the industry, such as factory shutdowns, production holidays, or operating at just 40-50 per cent capacity, leading to very low ROCE (return on capital employed).
Our role is to collaborate with these smaller players, placing bulk orders to optimise their factory operations, reduce wastage, and improve efficiency. This partnership results in faster inventory turnover, quicker payments, and better cash flow predictability. We may also assist them in sourcing raw materials like cotton.
In essence, by empowering these smaller players, we aim to organise this vast, currently unorganised industry.
What is the selection process for suppliers, ensuring quality and trusted sources?
When TYB partners with a supplier, we conduct a thorough assessment of their infrastructure, including their mixing, spinning, and packaging processes. We identify any gaps and work with the supplier to improve their processes. This leads to better quality yarn and consistency, which builds trust with our buyers. As a result, they are more likely to source their yarn requirements from us.
Can you describe the inception of The Yarn Bazaar and what motivated you to start this venture?
I always wanted to start my own business, so I went to Warwick University to get my master’s in innovation and entrepreneurship. When I came back to India, I was ready to launch my own venture. However, certain circumstances led me to join my family’s fabric manufacturing business instead.
I spent the next seven years managing yarn sourcing and fabric production. During that time, I saw firsthand how broken the supply chain was. And this was limiting the growth of the business. It was incredibly difficult to find the right quality, right supplier, and right price, and ensure OTIF (On Time In Full) delivery. Sometimes I could find the right quality at the right price, but the delivery was late. At other times, I could get the right price and delivery, but the quality was not good enough.
So, there was a constant struggle, and I wanted to do something to fix it. Hence, I started exploring the space and realised that many small yarn manufacturers struggle with high unutilised capacity. Most of their sales are limited to their local geography and due to a lack of brand image, they are unable to command price premiums. The Indian textile industry is dominated by SMEs. Hence, organising this large un-organised space became very interesting to me. I had faced a lot of trouble in yarn sourcing, so streamlining yarn sourcing made the most sense to me. This made it even more important to create a platform that would connect buyers and sellers of yarn transparently and efficiently. That is how The Yarn Bazaar was born.
How do you identify and help small yarn buyers and suppliers combat their unique challenges?
The primary concerns for most buyers typically revolve around obtaining the correct quality, competitive pricing, and timely delivery. The Yarn Bazaar excels in comprehending these buyer requisites. As a managed B2B marketplace, we boast a broader supplier network compared to traditional offline traders. This expanded network enables us to align supplier capabilities with a more extensive range of buyer demands, ultimately empowering them with the optimal blend of QCD, i.e., Quality, Cost, and Delivery.
We also understand that suppliers want to sell and get paid quickly, and have a steady stream of orders. For small suppliers, we work directly with them to ensure that there is always a demand for their yarn. We also offer upfront payments, which helps them improve their cash flow. In addition, we provide market insights and advisory services to help them forecast demand and improve their factory efficiency.
Additionally, we have cultivated relationships with supply chain financing partners, enabling us to finance entire transactions while ensuring suppliers receive advance payments.
Can you discuss any specific success stories or testimonials that exemplify the impact The Yarn Bazaar has had on the industry?
In one case, we helped weavers save significantly by suggesting a substitute for 60 combed yarn. We understood the fabric needs, machinery, and processes of the weavers, and we suggested substituting 60s cw (carded weaving) yarn with 60s kwc (knitted worsted count) yarn, which is priced nearly ₹35 lower. This switch not only maintained quality but also allowed the weavers to offer a more competitive price and improve their margins. In another case, we proposed a buyer for substituting 30/32 kw yarn with imported 30s OE 1800 CSP yarn, which again resulted in substantial cost savings of ₹30-35.
During the lockdown, we ensured suppliers’ factories ran at full capacity by securing advance payments from fabric manufacturers.
Plus, there are times when we assist mills in selling surplus yarn that they may find challenging to sell in the open market. We do this by securing advance payments from buyers, ensuring that they receive the right price for their yarn.
What are the future goals and milestones you have set for the company in the coming years?
We recently relocated from Mumbai to Bengaluru to expand our team and product offerings. We are also enhancing our technology to provide a better experience to both spinners and yarn consumers.
One of our key goals is to launch the new TYB App very soon. We have high hopes for this app, and we believe that it will be a major milestone for us.
We are also in the process of launching several new features and verticals in line with our vision of organising the large unorganised textile industry. We are confident that these new offerings will be well-received by the market.
How can someone interested in selling or buying on The Yarn Bazaar get started, and what support can they expect from your team?
No matter if you are a yarn buyer or seller, you can reach out to us through any preferred channel. You can send us an email, contact us through our website or WhatsApp, or simply give us a call.
We will put you in touch with a dedicated account manager who will be your single point of contact and will work with you to ensure that you get the best possible service.
If you are a buyer, we will work closely with you to ensure that you get good quality yarn at a good price, with timely delivery. If you are a seller, we will help you get regular sales of yarn in large quantities, and we will also help you secure 100 per cent advance payment.
Finally, what advice would you give to new entrants into the textile industry, considering the current landscape and future trends?
The textile industry offers a vast market with significant potential, especially in India, where it is decentralised and largely unorganised, dominated by SMEs. When starting a new business, it is crucial to target a sizable market, and the textile sector provides just that.
However, my advice is not limited to manufacturing alone. While manufacturing holds enormous opportunities, the textile industry also offers various prospects in services and business enablement. Globally, many successful textile startups focus on providing technology, processes, or other services beyond manufacturing.
In summary, the textile industry presents massive and diverse opportunities, from fibres to fashion, and home furnishings to technical textiles. The possibilities are boundless. Explore market gaps, and seize opportunities, and once you start, there should be no turning back.
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