V Ashok Ram Kumar, the managing director of Asian Fabricx, has just returned from Sweden after attending IKEA’s annual supplier meet. Every year, the Swedish retailer calls its top 100 suppliers from around the world to share growth plans for the coming years. As one of the largest and oldest suppliers to IKEA, Asian Fabricx has been a regular at the meet for years now. The partnership in fact spans over three decades, growing more strategic with the passage of years.
In fact, Asian Fabricx is one of IKEA’s prioritised suppliers, a tag that doesn’t come that easy. In the textiles space, there are just four and this Karur-based company is one of them. From India, it is the only one. Asian’s story, however, is not just about the successful relationship between one of world’s largest retailers and a home textile manufacturer, but also about how you can build a world-class company from anywhere, even a small town in South India with a population of just 70,000.
Weaving a business
Asian Fabricx was started by Kumar’s father N R Venkatachalam in 1974, with 15 employees. Today, it has over 3,500 employees. “When we started in 1974, we were focused more on the domestic market. We started exports only in the 1980s and started supplying to IKEA in 1982 through an agent. When the retailer started its trading office in 1992-93, the agent was retiring, so we started dealing with them directly,” shares Kumar.
He joined the business in 1995 after completing his graduation, when the company’s revenue was around Rs.4 crore. But even then IKEA accounted for Rs.1-2 crore of the revenues. At that time, Asian had 50 sewing machines and outsourced activities such as weaving and dyeing. But once it started working directly with IKEA, the company was able to weave a bigger story, growing revenues to Rs.70 crore by the end of 2000. “When we started, the demand for handloom products was very high and there were very few suppliers so the business scaled up quickly,” says Kumar.
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