Imagine going to an apparel shop that allows you to try out shirts, but not to collect the delivery (even after the payment!).
That’s Zerostock!
ZeroStock is an interesting retail startup that is attempting a breakthrough in supply chain.
Their stores do not have any readymade apparel available, i.e. zero inventory model.
All a customer has to do is walk into any of the stores, figure out the size which will fit them with the trial shirts on display and then select the design and the material of the shirt. Once the transaction is done, the shirt will be dispatched to the customer within a matter of 24 hours to 48 hours from their centralized inventory at no additional cost. [source]
Started by Wharton grads, ZeroStock plans to have 300 shops (brand name: Cornerstone) across major cities and towns by the year end.
In essence, zerostock is trying to improve the supply chain inefficiency and their major USP is
the money saved by not maintaining any inventory (and the associated jazz). They have central inventories and source the products on-demand – essentially a postponement strategy, which will keep the cost low (hope they transfer the saving to the user as well)
One of the other USP of ZeroStock is that have sizes right from 29 to 46 (i.e. sequential, one can buy 33/35 size as well).
The team has raised $4 million from angel investors (I heard about them last October) and are planning to raising Rs 50 crores to support growth plans.
Their online version will be available soon.
What’s your take on this model? Are you willing to wait for a day or two to collect the shirt you saw a few days back?
Shopping is quite an impulsive decision and unless they provide major discounts, the selection-to-delivery delay will be a hindrance in mass adoption.
Your opinion?
Shopping is also a lot about instant gratification. Most of the times we buy something at the prospect of getting it immediately. That is going to be a major disadvantage for Zero Stock. They have to bear the costs of physical stores and still have one of the big minus points of online stores.
dear Umang,
If your looking for a dress that you have to were right there and move, its not possiable. other wise if its ok to get the dress at you door step next day of your size and shade…then you can very well relay of Zero stock. You can even book a surprise gift to your loved ones.
I agree with Umang. Unless some of their cost savings is passed on to the customers, i dont see this working.
If they can have sample pieces which one can try on and then buy for less compared to other stores. That has potential to succeed.
cost saving is do shared with customer….do you think how..if you go for any quality brand they charge you 40% more than product at cornerstone. As you aware quality of fabric is desided on counts…higher the count greater the quality….say a 120 count shirt in market will cost you some were 2000 to 2500…the same you get 1100 -1200… This is where a customer gains….that too your right fit.
“zero inventory model” and “improving supply chain inefficiencies” mean nothing to a customer until that brings significant reduction in pricing.
Value proposition based on lower cost is generally weak from strategic standpoint because there is a limit to reduction in costs and can easily be copied by bigger competitors who have advantage of scale. Low cost positioning also creates a negative brand image in the eyes of customers.
It would be interesting to understand why they chose offline model (with apparels!) and not an online model with stuff that doesn’t need to be touched and felt.
this seams you have never been to a cornerstone store….please visit any one of the store across India…check with the executive there…he will explain you better. It is easy to copy….I do agree….but if you say the same with other brands…then you won’t any customer on there floor.
I think it can work if they propagate the savings to the customer. Will they be selling only men’s apparels? It’s not unusual for women to buy clothes and then have them altered. I would be cool with waiting if it I’m getting a perfect fit and for cheaper. But do men worry about the perfect fit for a shirt?
we are comming out with even ladies outfit in near future…
The diff needs to be in pricing as well as offering – just updated the post with 1 more finding –
ZeroStock offers sizes right from 29 to 46 (i.e. sequential, one can buy 33/35 size as well)..isn’t that a big differentiator?
But is that big enough?
Not too sure.
Often found while shopping for clothes that a particular size shirt or trousers of Brand A, say size X, fits in one way, and the same marked size in brand B of the same size X fits completely differently! Sometimes the size difference between the two brands is quite considerable. Even within brands, different labels fit differently. Will they have trial shirts of all labels and all brands? They would need to do that, else face several returns!
we do have trials…in all sizes…both shirt and trousers..you coose your size from that only…then book our shade..its easy…
When I shopped at their stores …I was impressed.. they stand alone in quality too…its was first I have learned about the fabric what I wear. few point what I found that they are different are :
Fits: Cornerstone carries the widest range of fits. For example, Cornerstone carries men’s shirts in 11 sizes from 36 to 46. Compare this with other brands, which typically carry only 4 sizes. Thus, the customer is much more likely to get his exact fit. Similar in chinos the company carries 14 sizes between 28 and 46, and 6 different sizes in knits.
Designs: Cornerstone has over 200 design selections just in formal shirts. Worldwide, very few brands offer garments in 100’s count and above. Cornerstone, on the other hand, offers over 50% of its entire collection in 100’s or above counts.
Savings: As a result of its unique model, the company has realized cost savings in various aspects of the supply chain. These are passed on directly to the customer.
[off topic] for some strage reason i am unable to naildown this post of yours reminds me of a article i read at 37signals
http://www.37signals.com/svn/posts/89-consumer-reports-unfortunate-advice
you mean this one: http://www.pluggd.in/2006/12/who-should-define-productfeaturehtml
Mangas a Spanish chain does this custom made shirts and suits made to order no stock get shirts 3 weeks later. All over Spain and London. Cheap prices comparable to Marks & Spencers.
So no original idea here at all.
You will wonder once you visited their store. I got my right size from them in Toruser and shirts also with 40-45% cheaper than Zodiac and van Huesen for the same material.I’m this will change the traditional concepts in the readymade industry. Because they are offering Odd and Even sizes in Trousers and shirts as well.Top it all they are carrying 300 above designs!
If you are ready to wait for 2-3 days you will get the right fit for you that you have never seen before.
I just want to answer to mr. Hein here.
The differentiation between Zerostock and the Spanish group is you are getting the purchased product in 2-3 days compared to 3 weeks.
-And On pricing: as Joseph rightly said Corner Stone is atleast 30-40% less than their competetors.
What else do you need, you get an Italian 2 ply 200 shirt for 3999/- (FYI Thomas Pink sells 2 ply 170′s shirt @ 125 pounds. that equals to ~10,500 rs/-)
try to visit their shop to check the difference in their offering.
bye the way you can visit their website also; http://www.cornerstonewear.com
-
Do these guys have a store in Up north as well.
pls check our web site….we are expanding….you can very well shop from any store…get it delivered at your doorstep at no cost.