By Tashi Sherpa of the New Business Age
Tuesday, 01 January 2008
Up until now the word ‘Sherpa’ has always evoked the image of a mountain community legendary for its skills in mountaineering. Tashi Sherpa however has taken the name further by using it in his brand of outdoor clothing and gear, Sherpa Adventure Gear.
Sherpa Adventure Gear, the US company that Tashi owns , has its roots in the early 1980s when Tashi owned a clothing factory in Kathmandu. In 1989, he migrated to the USA with his family shortly after selling his interests in the business.
Looking back, Tashi feels strongly that the local industry might have been served better had we collaborated with either Korean or Hong Kong manufacturers. Their technical expertise and guidance would have eased the initial learning curve and given it the right impetus. “But that does not take anything away from the tremendous contribution of Indian importers who after all were the ones to kick start garment exports in Nepal.” he adds.
Those days, there was limited opportunity for growth with factories working mainly on overflow business. Profits were minimal and no creative control existed. Still, he invested and learned about product design and development, experimented with line systems when it was unusual for factory owners to venture too much out of their comfort zone. This led to orders from overseas retailers and really built the foundation for his eventual business model. It gave him the confidence to venture into direct business with retail chains. However, the end of the 1980s showed the first signs of an inevitable decline in garment exports from Nepal. While the other countries were opening up with better facilities and cost competitive advantages, Nepal’s inherent challenges of being landlocked and higher costs of production, would mean drastic cuts and slowdowns in the immediate future. “We were competing with ourselves on price. The same customer who bought an article from us for $ 10 would ask to reduce it to $ 7 because Bangladesh was ready to provide it for $ 6. It appeared there was no end to this sort of price cutting and that was a slippery slope,” he recalls. It did not help also that the quota regime was soon coming to an end and there would be no need for anyone to buy garments from Nepal.
So, in 1989, he moved with his family to Seattle, Washington. There, he once again started his import business from scratch right in the middle of the worst US recession, because, as he puts it, that was what he knew best and at the age of 36 it was not possible to start a career in a new field. In the early days, his fledgling company imported merchandise in small lots from Nepal and other neighboring countries. Now 19 years later, that business, under the name Duo-Wear has successfully managed to fill in the large private label volume needs of specialty stores and distributors as a producer and supplier of sportswear. He stresses that creative sourcing, pricing and cost efficient delivery are key drivers for this market.
Four years ago, he established Sherpa Adventure Gear, which was inspired by a simple idea. He is grateful for Duo Wear’s success, since this allowed him to leverage its resources into supporting the creation and growth of his current brainchild.
During all these years Tashi kept his connection with Nepal. His Nepal office, initially run by a few key personnel, is growing every day, all involved deeply in product development, preseason sampling and sourcing. He considers it a matter of great pride that initial production patterns are all prepared and sent from his Nepal office to vendors in China, Hong Kong and Korea. This system continues today, with quality control and technical details still being supervised and finalized from here. A design and merchandising team in the US oversees creation of new seasonal lines. International sales and marketing is managed by his daughter, Tsedo Sherpa, who is now Vice President. An experienced sales team covers the entire US along with distributors in Europe, Asia, North and South America.
To the question of how doing garment business in USA is, “Very tough,” responds Tashi. “The prices of mass merchandise are so low. In fact, the US is perhaps the cheapest market in the whole world. You can often buy garments in the US cheaper than in Nepal. Where else can you buy a big flat screen TV for $ 375?” he asks. The conclusion is that to be successful in the US in manufacturing, one has to have tremendous resources and resilience. One needs to create a niche and work at it.
The story of Sherpa Adventure Gear started in May 2003, when Tashi was walking down the streets of Manhattan, New York. He suddenly saw the picture of his uncle Ang Gyalzen Sherpa staring at him from the cover of a magazine’s issue commemorating the 50th anniversary of the first ascent on Mt. Everest. Now at the age of 90, Ang Gyalzen is the only surviving Sherpa member of the celebrated expedition that put Sir Edmund Hillary and Tenzing Norgay on top of the world’s highest peak in 1953.
He was deeply saddened to read about the unsung Sherpa heroes who, in spite of their brave feats, spend their lives without the glamour and economic success enjoyed by Western climbers. These very climbers would never have been able to reach the summit of Everest without a Sherpa by their side.
After reading that magazine story, he felt the urge to do something for the Sherpas and tell their story to the world. Thus grew the idea of setting up Sherpa Adventure Gear, a company that would produce high quality climbing gear and clothing, tested and endorsed by world famous Sherpa mountaineers. In return they receive royalties based on sales.
“We started this without any concrete business plan,” he recalls though he does not recommend it to any budding entrepreneur. It was just sheer faith in the brand’s message. Over the past four years, it is paying off, he says. Explaining it, he adds: “I believe in the Toyota Way which says you have to learn by doing it yourself and making mistakes in the process. Continuous improvement is the only way.”
Tashi is happy with the way the brand and its story has resonated among customers everywhere. It is already being distributed in more than 10 countries such as the USA, UK, Austria, Scandinavia, Switzerland, Germany, Canada, Taiwan, New Zealand and, most recently, Colombia. The growth in the business in the last couple of years has necessitated more capital investment for him. The plan is to invite like minded investors through private placements in the near future. The goal is to increase brand awareness for Sherpa Adventure Gear and establish a strong global footprint through distributors and company owned retail outlets in major cities. Two of his closest friends are the first outside investors in the company
Sherpa Adventure Gear believes in a win-win business philosophy by selling a superlative product to people who love the outdoors. Out of the sales, royalty is paid to the Sherpa brand ambassadors and a contribution is made to Sherpa Education fund from where scholarships are provided for poor Sherpa children.
One of the current goals is to increase sourcing from Nepal for Sherpa Adventure Gear. The idea that Nepal is only a source of cheap products is no longer true, at least for the Sherpa brand. “But this is only a plan right now. It may change if the situation in the country turns unfavorable again. Of course, the hope is that the climate for investment turns stable,” he clarifies. One has to have a plan in writing but must also be flexible enough to change as the situation demands.
“And this is the model that the Nepali export industry has to go for,” says Tashi. “Harping on the same old demand of subsidies and duty free entry for Nepali products is not going to get this industry anywhere. We have to do something that makes our inherent cost strictures and price challenges irrelevant and that can be done by creating a ‘blue ocean niche’,” he adds. Sherpa Adventure Gear products are not cheap because it competes with the best outdoor brands in the world. Its world class catalogues, which are printed twice a year, play a tremendous role in showcasing not only its gear but also the unique beauty and culture of the Sherpa landscape. Price is not the issue for this eponymous brand.
What about the complaint that Nepali workers are not so productive? Tashi does not agree. Their skills are on multiple levels and all it takes is a firm belief in the human spirit, be they Nepali or Chinese. Constant training, empowerment of the individual and believing in their ability, regularly teaching them new ideas, encouraging them and walking the floor, listening to their voice and winning their trust – these are the keys to success, he says. It is just not about fair wages alone. Nepal has a pool of skilled workers, versatile and very sharp in understanding what is needed,” he believes. “It is a rare skill these days to be able to sew complete garments and that is what our people here do. We just don’t sew clothing. Our people proudly make gear that perform in all weather conditions and which are as good as the best outdoor brands out there. This is a global brand and they help make it happen. They are our best kept secret and a tremendous asset for the company.”
Photo of Tsedo Sherpa and Tashi Sherpa by Joseph Puryear.