Hat for everyone: effective techniques in the clothing ring
Kharkiv residents Andrei Lukyanenko and Alexander Fedorov come from big sports who have found their second calling in business. Thousands of Ukrainians are already wearing clothes that are manufactured at their enterprise, sports teams are training, and European fashionistas will soon show off.
Many years ago, both partners were professionally involved in sports. Andrei played in the USSR national water polo team. Alexander is a boxer, participated in international competitions, was a prize winner of the Ukrainian championship. Both were keen on wrestling, performed. In the 90s, like most other athletes, they had to look for other ways to earn money. Friends had many different business start-ups, and quite successful ones, including the import of clothes from China and Poland. By supplying clothes and hats, entrepreneurs saw that these goods were in demand. Then the idea came up to produce their products - affordable, but decent. After all, not everyone who can’t pay for brands agrees to wear “consumer goods”.
Partners purchased equipment, found a room, people and launched the first production - knitted hats of various kinds. So more than 15 years ago their first brand appeared - Art Belleza. The instinct of the winner, characteristic of athletes, worked. The release and marketing of products quickly gained momentum. Until 2014, a factory with a dozen expensive Japanese knitting machines produced 200-300 thousand pieces of knitted hats and scarves per year. Products were sold on the domestic market of Ukraine, exported to Russia. Before the war, the company worked in this niche, not thinking about expansion. Then the neighboring market closed, and I had to look for an alternative: either change the geography, or increase the product range. They chose the second path - and did not lose. So another brand appeared, SEVEN - T-shirts with original prints. After a successful start, a variety of urban-style clothes began to be sewn under this brand. SEVEN has firmly established itself in the medium + segment.
Art Belleza, although it remained in the mass market segment, has also been updated. In addition to hats and T-shirts, a dozen new items of knitwear and knitwear for women appeared in the assortment: suits, sweaters, pullovers, dresses, skirts, trousers, shorts, snoods ... We developed the nomenclature, taking into account the financial capabilities of a wide range of Ukrainians, but did not form an affordable price due to the quality of raw materials or work, and due to large parties, turnover. Another right decision was cooperation with talented designers, which allowed us to create a competitive assortment. The calculations were justified, the company's products quickly took their place in the highly competitive market.
“If you want your business to be successful, love your product. We love beautiful people, we like nice, stylish clothes, we love to look good and dress well. Do we wear the things we produce - definitely yes, all the time! When we see them on acquaintances, friends, and random people, on photos of acquaintances in different countries of the world, we feel proud, we understand that our clothes are really worthy and we managed to achieve something ”- Alexander Fedorov, entrepreneur.
Another area that has developed and characterizes the company is highly specialized sportswear. The development of such products begins with an analysis of operational requirements and the wishes of athletes. Andrei and Alexander are very proud of the collection for martial arts Vovchanchyn sport, created in partnership with multiple world champion in fights without rules Igor Vovchanchan, also a Kharkov resident. “This is not just naming, this is co-authorship. This is another friend of ours, and we developed this collection with him. As a result, it became one of the most popular and best-selling ones, ”says Andrey Lukyanenko. According to him, soon there will be clothes for bodybuilders. Alexey Kipyatok, known in this sport, is now developing his collection. There are plans for projects with Yana Klochkova, Vasily Virastyuk. “All such personalized clothing trends are very thought out, because they take into account the large consumer experience of athletes. They do what they would buy themselves, ”adds Fedorov.
Now the main brands Art Belleza and SEVEN produce 200-300 new models per season, in the sports direction - up to fifty. All this is the result of the work of almost a hundred employees of the company. “We cannot compete with the volumes of investments and production with ZARA, GAP, but we can compete with them in the quality of goods and emotion,” Andrei is sure. Another advantage is the expanded dimensional grid and the ability to order your favorite model by individual standards.
The roles of partners are clearly divided. Alexander Fedorov is working on the development and creation of brands, he also oversees production. Andrei Lukyanenko is engaged in promoting the company, marketing, entering the European market. Another partner, Igor Tsiryulnik, is responsible for financial development and investment attraction. All strategic decisions are made collectively.
Returning to production, one of the interesting and “fired” business decisions was the introduction of an element of the sharing economy. Entrepreneurs commissioned most of the industrial equipment to partner workshops. With experienced employees, they produce their products and Art Belleza on leased equipment. At the same time, brand owners provide model development, provide raw materials, and make strict quality control of finished products.
Such a scheme, on the one hand, provides a small additional profit. And on the other, it helps to reduce the costs of maintaining and repairing equipment, energy and utilities, labor and taxation. And it also eliminates a lot of production hassle: recruiting, monitoring workers, meeting deadlines. As it turned out, in addition to their products, entrepreneurs commissioned clothes for well-known brands: VOVK, Andre Tan, Cabanchi. They also have corporate orders - for example, scarves for New Mail.
Knitting and sewing quality clothes is half the success. The second and decisive is to sell it, find the right channels. Art Belleza is first and foremost a b2b implementation, wholesales to stores, to markets. A large amount of goods is given for sale or in installments. This helps to increase coverage, because not all merchants can allocate funds for prepayment. Previously, clothes were sold in their own retail - in the center of Kharkov, businessmen had a store that worked successfully, but they closed it in the end: it turned out to be very small, did not fit the entire range and did not correspond to the concept of brands. Looking ahead, we’ll say that now partners are working on opening a modern showroom that meets all needs.
SEVEN clothes are mainly sold at retail: in the online store, on the Instagram page, which gives a good conversion. Now the company is signing an agreement with Amazon, expecting significant efficiency from this resource. “We are connected to almost all marketplaces. If we talk about their effectiveness, then “Rosette” and Prom.ua are not particularly effective in this category of goods. Lamoda, LeBoutique and Modna Casta are our sites. This is not to say that they give tangible profits, sales are at the maximum discount, sometimes on the verge of cost. But these channels have to be used to promote brands or to sell off goods at the end of the season, ”Alexander explains. There is no point in storing leftovers, although this is not a perishable product. Fashion is changing, interest in these clothes is passing until the next season, and so much money will be spent on logistics and storage that it becomes irrational.
The Pareto principle for this business works specifically. In each season, the legendary 80% of the profits come from different categories of goods. Autumn - knitted clothes, winter - hats, summer - t-shirts, spring - sportswear ... Due to a change in the nomenclature, the capacity of the enterprise is constantly loaded, there are no problems with the seasonality of workers, failures in working capital.
“Our business is no longer young and held by Ukrainian standards, now we are at the stage of scaling up, introducing new brands into those niches where we have not yet been represented,” Andrei Lukyanenko summarizes the work. The strategic plan of the company is to enter Europe. Now Andrey is working on a new, fourth brand in the Luxury category. He plans to register it in France as local. “We will develop clothing lines together with European designers, we will use Italian and French raw materials, and we plan to produce them in Ukraine, in our factory. By saving on capital goods, we will become competitive. This clothing will be sold in stores in Paris, Berlin, Milan. We also organize online trading. We are working on the details of this project, ”the entrepreneur announces.
Businessmen very carefully approach the development of the company, trying to invest earned money in new projects or attract new partners. For example, the financial chosen rather scrupulously. “We are far from a startup, therefore, we have expressed many requirements for the bank. According to our estimates, this is one of the leading financial institutions in the country with good positions in the international market. This was no less important given our plans to enter the European market. So far we use accounts, we intend to be serviced by merchandise accounts, Internet acquiring. With the opening of business in other countries, these will be export-import operations. These projects are investment-intensive and surplus in themselves, and their launch may involve resorting to loan products, ”Andrei Lukyanenko shares his plans.
Entrepreneurs pay a lot of attention to social projects. One of them, the Rainbow Rehabilitation Center, helped people with alcohol and drug addiction. A unique program for psychocorrection and self-motivation was implemented there. During the year of operation, the center became the best in the Kharkiv region, more than 100 people underwent treatment, of which 20 were fully rehabilitated. Now the project has been suspended. The second is a charity fund that provides assistance to children with diabetes. The company also transfers clothes to orphanages. The dream of entrepreneurs is to launch a long-term project aimed at children and youth. Within its framework, those disciplines that go around the state educational system should be taught. This is social adaptation, moral development, interpersonal, social, business psychology, ethics, valueology, proper nutrition.
By the way, Andrei Lukyanenko and Alexander Fedorov, although they left sports, are still the same adherents of a healthy lifestyle, are engaged in boxing and cross-fit. Andrei, at 50, every day in the gym. “Being the face of the company, it is important to always look worthy, to be an example for the team, partners and customers,” Alexander emphasizes.
Alexander Fedorov, founder of the company, creator of the brand SEVEN
“Now is the time for speed. If earlier powerful ones won - small ones, now fast ones win - slow ones. In the period of rapid development of technology and information space, the right business with a good idea can quickly develop to a significant scale. There are many examples of this. A big advantage for entrepreneurs is the openness and accessibility of business information. Big brands like GAP and ZARA have been created for decades, learning from their own mistakes. And we can learn from their mistakes and pass them in one season. For us, this is a role model, our teacher. ”
Andrey Lukyanenko, partner for the development of the European market
“To be successful, you need to be better than others at least in something. Our difference is in style, brand philosophy, production approaches, big names that go with us. We invest heavily in good fabrics, good threads, in the work of talented designers. Creating a brand, you can’t trifle. We are constantly modifying, changing, improving, learning ... Business is for us not a routine, not a job, but a hobby, a way of life. The desire to develop it energizes us and our entire team. ”
