[Startup Bharat] This entrepreneur left his job in the US to start a Surat-based clothing brand; sells 3 lakh units a month

XYXX Apparels added 250 people to their team from 70 people in April 2020. The startup is expecting to almost double its growth by the end of FY22 and has also set up operations in Mumbai.
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When the COVID-19 pandemic hit, people preferred to wear comfortable clothes at home as they didn’t have anywhere to go amid the lockdown. This is corroborated by the rapid growth India’s innerwear brands saw amid the lockdown, growing at 18-20 percent annually.

But with Indians having more disposable income, the athleisure wear market has been growing year-on-year. In India, the men’s innerwear market stood at Rs 165 billion in 2020 compared to Rs 85 billion in 2015, according to Statista.

Seeing the trend, entrepreneur Yogesh Kabra started XYXX Apparels in Surat in 2017. Today, the startup sells three lakh units of its product every month.

From US to India

After completing his MBA from Hult International Business School, Yogesh landed a cushy job in the US. But while working in Boston, he realised that he had always wanted to start something of his own. However, for that, he needed to ensure that he wasn’t shouldering a lot of financial responsibilities. 

XYXX Apparel sells three lakh units, mostly underwear, every month. Yogesh expects to sell between six lakh and seven lakh units per month by the end of FY22.

“If I would have been in a job for long, I would have wanted to buy a house. To do that you usually take a loan, and once you enter the instalment cycle, it would have been very long before I would have decided to start a business,” Yogesh tells YourStory

So, in 2015, he returned to Surat, his hometown, and started working in his father’s textile business. After a few months, Yogesh realised that though he wanted to keep working in the textile industry, he wanted to do something of his own.

Finding the gap

Despite browsing men’s undergarments at a few stores across Surat, Yogesh could not find many new brands that had products that had a good quality. 

“I came across only two brands – both had the same stitching, fabric, and feel; only the brand name was different. It got me thinking ‘why do we not have any other brand in this space?’” he adds. 

After spending about six months researching the market and doing preparations, Yogesh invested Rs 50 lakh and founded XYXX Apparels in 2017. The startup sells men’s underwear, boxers, briefs, trunks, and knitted pyjamas. 

Serving the premium segment, the brand set the price range between Rs 199 and Rs 399. Currently, their products start at Rs 215, with the highest product selling at Rs 350. 

Currently, the brand sells three lakh units, mostly underwear, every month. Yogesh expects to sell between six lakh and seven lakh units per month by the end of FY22. In 2019, the brand reached three lakh consumers.   

XYXX Apparel claims to use micromodal fabric in its innerwear. “The fabric is extracted from pulp beechwood trees in Austria; it is naturally anti-microbial and therefore, the best natural fabric for the hot and humid Indian weather,” Yogesh told YourStory in an earlier interaction. 

He claims this fabric makes their product very soft and comfortable to use in the Indian environment. 

Ensuring quality

XYXX outsources manufacturing to third parties that on average produce 36 lakh units every year. Currently, the firm makes 50 percent sales from online channels – including marketplaces and their own website – and the remaining half comes from general trade stores and premium clothing stores. 

With its growth doubled, in terms of sales, the company also set up an office in Mumbai about six months ago for hiring purposes. 

Credit: YourStory Design

“Even though the quality of life in Surat is much better than a metro city, hiring good talent is still a challenge. Getting a good team for a growing company is very essential,” says Yogesh. 

Market and future plans

The startup currently has a team of 250 people, up from 70 members in April 2020.  

This growth has also got investors interested in the bootstrapped firm. Sauce.VC, a seed-stage investor focused on consumer startups, gave the company its first investor cheque in March 2019. The Delhi-based firm also invested Rs 6 crore in pre-Series A around the same year and led the Series A round of Rs 30 crore with DSG Consumer Partner in 2021.

At the moment, XYXX competes with Page Industries’ Jockey, Van Heusen, and three-year-old Damench, a men's clothing brand backed by Matrix Partner India. 

Edited by Kanishk Singh

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