Over the years, the growth of corporate Pakistan has created numerous opportunities for companies which benefitted from serving the needs of people working in the services sector. One such example is Cotton and Cotton, a Karachi-based exporter and retailer of readymade garments, famous for its high-end dress shirts.
The growth of the corporate sector has certainly helped C&C’s business a great deal, CEO Syed Yadullah said. “Further growth in this sector will mean higher sales for our products,” he added.
The 2008 global recession severely affected C&C’s revenues, particularly those from exports, nevertheless the company’s sales are growing at 20%. In recent years, C&C, whose export revenues surpassed $2 million, has witnessed a phenomenal increase in sales from its domestic operations, which comprise a countrywide network of retail outlets for its brand Cotton and Cotton.
Yadullah refused to share the revenues from the domestic market but hinted these were higher than what the company earned from exports.
Until 2007, the local market used to be 30% of the revenue base, but it now accounts for half of the total revenue, he said. Explaining, he said the growth in the country’s services sector helped increase domestic sales to a great extent, though exports were affected by the 2008 global recession, which really changed the entire equation.
How the company grew
Starting off with two machines and four workers, Yadullah said, they launched C&C some 20 years ago. The garment manufacturer now has retail outlets in Islamabad, Lahore, Faisalabad, Gujrat, Multan and Karachi. C&C also exports readymade garments to Australia, UK, USA and Canada.
In the beginning, the company made and sold shirts in small quantity to the local market. “Our desire to make superior quality shirts led to the birth of A Regalia,” he said, referring to C&C’s sister company based in the Export Processing Zone of Karachi. The sister concern manufactures a wide range of products including dress shirts, casual shirts, trousers, pajamas, boxers, leather belts and wallets for both local and international markets.
Talking about growth in domestic operations, Yadullah said the element of wearing nice clothes counts a lot. “Your clothes are noticed by your colleagues,” he said, as the growth in the services sector, including banks, other financial institutions, insurance firms, telecom companies and others, is creating more demand for high-end clothing.
After tapping the domestic corporate sector, C&C is now planning to expand its retail network to the Middle East. Pakistanis are in large numbers in multinationals across the Middle East, Yadullah said, adding again this is the corporate sector that provides a niche market for C&C shirts.
However, C&C is waiting for the right time to enter that market. Elaborating, he said, “We launched C&C brand in USA and Canada four years ago, but it was bad timing. The 2008 recession hit those markets and our business didn’t grow as desired, it did fine though. We are still there and with economies recovering, we will see growth.”
While the services sector has contributed significantly to the company’s income, its business strategy – targeting a niche market – cannot be ignored either.
“We don’t do our business in volumes thus we have a small market share. We cater to a niche market selling high-end shirts,” Yadullah said.
For example, shirts sold on Jermyn Street, a 200-year-old tourist place in London, mainly famous for classic gentlemen shirts, range from 65 to 150 British pound, he said, adding not everyone can buy those expensive shirts, which cater to high-end customers or very small niche market.
Jermyn Street is the place from where C&C started its export business. The company exports its shirts to three brands on the street, which is famous for its resident shirt makers – Turnbull & Asser, Charles Tyrwhitt, Thomas Pink and TM Lewin for example.
Published in The Express Tribune, May 4th, 2012.
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