Ayush Fashion – The Expansion Dilemma

Abstract

Ayush Fashion Private Limited saw strong growth in sales volumes in its girlswear (age 1–16 years) garment market over the past few years. Under the visionary leadership of its chairperson, Jaya Bakshi, and supporting capable management, led by the managing director Ajay Chopra, Ayush had become a household name in the northern parts of India for producing garments in the premium category. 1 However, in the last three years, a substantial decline in its profits created concern for the management. After a series of deliberations, the board of directors considered three options to contain the decline in profits: (1) expand into the boyswear category for the same age group, (2) expand into the womenswear category for the age group 16-40 years, and (3) no expansion, but focus on cost reduction. The case enables students to appreciate the challenges of line extension, product/market development, and the importance of strategic decision making for mid-sized firms in a situation which requires a rapid course of correction.

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