Designer wear has never been more affordable and accessible. But what’s sewing the thread of success for the boutique industry?
The rise of designer wear in Nepal over the past decade has been nothing less than meteoric. With Nepalis earning more, the demand for high-end fashion has soared and a number of boutiques are taking advantage of the new market forces.
Boutique stores such as Oodni, Chaahat, Crossroad Apparel, Tarunika’s Creation, Kaavya Soul of Fashion, Muku, She Boutique and Swornim's Studio have become the trendsetters in the market, thanks to a powerful mix of runway-inspired glam, cut-rate prices and large store networks.
Retailers say the emphasis on local, unique experiences has led many consumers to eschew big brands for boutique or bespoke products.
The En Vogue Factor
"We’ve definitely seen a significant increment in the opening of luxury apparel boutiques and fashion designers have been able to successfully carve out a niche,” says Ashrita Bhadel, co-owner and Designer at Crossroad Apparel which she runs with her sister and business partner Subekshya Bhadel, a well known fashion designer.
“The lower entry barriers for designers and the rising number of trendy millennial consumers who are entering or have entered their peak purchasing years have been the major attributing factors for the rise of the boutique industry,” she states.
Not only are the traditional boutique garments gaining high popularity, but the demand for smart casual western boutique clothing has also been increasing. "People nowadays not only seek traditional wears like Lehenga, Sari and Kurtha. They also look for casual wears for office and party purposes," says, Bina Ghale, owner and designer of Gabi wears.
A newly designed dress that’s a hit at a major fashion show such as the Nepal Fashion Week instantly becomes a high-demand outfit and boutiques begin to cash in on the opportunity.
The financial well being of consumers is crucial to the industry’s growth because products are generally more expensive and rely on consumer discretionary incomes. The sharp growth of the boutique business has consequently been fuelled by the rise in disposable income and brand awareness. "Keeping pace with globalisation, Nepali consumers nowadays have become very conscious regarding brands and are willing to invest according
to the quality of product," Ghale adds.
New Customer Base
The boutique industry is typically thought to cater to the high-end or niche market and is reliant on the strong financial conditions of its buyers. Nevertheless, attitudes are changing with the increasing interest of middle class customers coupled with their rising buying power.
According to boutique owners, this burgeoning interest of the middle-class is offering designers a number of opportunities to invest more and earn more. Luxury boutiques that mostly used to provide services to elite and affluent clients over a decade ago are now also trying to cover the demand of the country’s rising middle class.
"The rising per capita income of Nepalis has brought a drastic change in the spending pattern of consumers, especially the youngsters," says senior fashion designer Mukta Shrestha who is the owner of Muku boutique. "Even the middle class people are now more flexible in their buying approach and do not mind spending money on luxury items that add to their living standards."
Rajiv Thapa, co-owner of Oodni Boutique shares similar views. "Previously the customers of boutiques used to be elite and high class people. But the customer base has been expanding with the middle class consumers showing their interest in boutique wears."
Despite this shift, there are still some boutiques that are only accessible to high spending customers. The apparels they design and produce are priced at several hundred thousand rupees, matching prices in the west.
Areas of the Kathmandu Valley such as Kupondole, Lazimpat, Naxal and Jhamsikhel have become boutique hubs while other places are also witnessing the opening of exclusive designer wear outlets. Kupondole, for instance, which only had five designer boutique stores 15 years ago now houses over 50 stores.
This fast explosion of stores has also led to stiff competition and the need for stores to keep up with the trends or be left behind. "The numbers are increasing and the ability to sustain oneself in such a competitive market is a huge challenge to the boutique owners and designers," says Thapa.
Traditionally, boutique stores were only associated with female customers. But now men are also being drawn towards boutique wear. "We have had male customers over the past few years who are very fashion conscious and keen on wearing customised clothing," mentions Thapa.
Despite the eye popping growth, the domestic boutique industry also has been struggling with various issues. Boutique owners point out to many instances where low cost apparels are tagged as designer wear. "We need to redefine the word boutique," says Mukta Shrestha.
"Nowadays, many people have started to take advantage of the rising boutique business. They import clothes from India and label them and sell them as a boutique wears." She suggests raising awareness among buyers in order to avoid bogus products.
The textiles, sewing threads and other necessary embroidery items used in boutique apparels are imported mainly from India, while authentic Nepali textiles, like Dhaka, is purchased within the country.
Internet as Major Business Platform
The rise of Internet shopping and the growth of off-price transactions are popular trends reshaping the Nepali boutique industry. With more and more consumers opting for e-commerce platforms, luxury fashion boutiques have earned their place in the digital universe. Most designers now interact with consumers both through their own websites or social media accounts.
And, even though pure online transactions are currently just a sliver of the total boutique market, there are strong indications that the scene will change over the next few years. According to Mukta Shrestha, the rise of online business has made the market more competitive. "The competitive environment has led us to make more efforts to come up with products with excellent quality and design."
As per analysts, nearly half of the buying decisions are already influenced by what consumers see on online marketplaces. Internet sales are booming at the cost of direct store purchases. Customers are favouring off-price boutiques that offer a dash of style at attractive price points. Industry analysts say that designers who want to survive will have to respond by restructuring their approach towards the consumers.
Meanwhile, buyers of boutique apparels also look for more convenience and value for their hard earned money. They not only want products at competitive prices, but also want more perks. Large boutiques have grasped this need of the buyers and have started to offer them convenience facilities on the purchase of products like cash on delivery, free return and free delivery policies.
The expansion of online marketplaces has also enabled Nepalis living abroad to purchase clothes from Nepal-based boutiques. Orders come from countries such as United States, United Kingdom and Australia where there is a sizeable presence of Nepali Diaspora. This has led some boutiques to open their outlets abroad. Odhni Boutique, for example, launched its first international branch, Odhni Dallas in Texas last year.
Nonetheless, industry watchers says that the brick and mortar outlets are here to stay as online platforms cannot assuage the desire among the buyers to feel and try out the apparels. According to Ashrita Bhadel, that even in this age of the internet, shopping in real life hasn’t become obsolete. "Can e-commerce take over the real experience of buying from boutiques? I don't think the desire to play with the product, to be social, and to be guided is going to go away," she says. "I think we're at the beginning of this new age, and it's something we're obsessed with."