Sapna Agarwal, MINT

Mumbai, 21 January 2016

Mahindra Retail, a part of the $16.9 billion Mahindra Group, will sell products of US kidswear firm Carter’s Inc. in its chain of BabyOye stores across India and online, the company said on Wednesday.

This will be Atlanta-based Carter’s third attempt at establishing itself in the Indian kidswear market.

Mahindra Retail plans to open 40 so-called shop-in-shop BabyOye stores—where a brand owner or retailer takes space in another retailer’s store—in 15 cities across India in 2016.

In the past, the OshKosh B’gosh kidswear brand, which Carter acquired globally in 2005, tried to make inroads in the Indian markets, first in the 1990s and then in 2008.

“With OshKosh B’gosh it had adopted a premium positioning which did not work in India as kidswear is a competitive segment with well entrenched local players,” said Devangshu Dutta, chief executive officer, Third Eyesight, a retail consultancy firm. According to him, getting the pricing and product right is important in this segment.

Now, Mahindra Retail and Carter’s have entered into a buy and sell arrangement. However, the two companies are looking at partnering beyond the agreement to create the look and feel of the Carter’s retail experience in India, said Prakash Wakankar, chief executive officer, Mahindra Retail.

Also with this partnership Carter’s is hoping to make the brand accessible to India. “We don’t anticipate any pricing discrepancy. We plan to make the brand accessible and have great value offering,” said Keving Corning, Carter’s executive vice-president (international). He did not rule out the possibility of bringing OshKosh B’gosh back to the Indian market in the future.

The Carter’s range will start at Rs.600 and go up to Rs.2,500 and will be available for the just born to 24-month-old toddlers in the brick and mortar stores. Online the company will have products for up to seven-year-olds.

(Published in Mint)

Sagar Malviya, The Economic Times
Mumbai, 19 January 2016

Fabindia Overseas has crossed Rs 1,000-crore sales mark to become the largest retail apparel brand in the country, significantly ahead of nearest rivals Zara and Levi’s India.
During 2014-15, the ethnic wear firm posted a 12% rise in consolidated sales at Rs 1,148 crore with 36% increase in profit before exceptional items at Rs 112 crore. Its domestic business grew 25% to touch Rs 767 crore ahead of largest fast-fashion brand Zara that clocked sales of Rs 720 crore during the same period.
"Customers are moving to one of two responses to retail. Either they are responding to products as commodities, or investing in curated products and experiences. We will continue to focus on the quality of our design and curation," said William Bissell, managing director at Fabindia, which runs more than 205 stores in India. The company also attributes its success to a policy of no discounting and instead build a sustainable cash flow.
Founded in 1960 by Bissell’s father John Bissell to market craft traditions of India, Fabindia started out as a company exporting home furnishings. The first retail store was opened in Greater Kailash, New Delhi, 15 years later. In mid 1990s, William Bissell took over the company.

The company added the non-textile range in 2000, while organic foods and personal care products were launched nearly a decade ago. Experts said the brand, which has expanded its portfolio over the years, has been finding acceptance among younger consumers since the last decade, a new development in a category earlier largely restricted to older buyers.
"The brand has been consistent to its core and they have been adding newer categories to remain relevant and also earn higher margins," said Devangshu Dutta, chief executive at retail consultancy Third Eyesight. "The challenge is to continue the momentum since their sourcing is dependent on thousands of craftsmen instead of a few large manufacturing units."
Ethnic wear, a segment still mostly fed by the unorganised segment, has been growing at an average of more than 10% a year over the last decade.

Leading department chains such as Shoppers Stop, Lifestyle and Westside are increasing the width of their private label range and offer contemporary styling in the ethnic space, fuelling growth. The ethnic wear segment is also seeing a lot of aggressive expansion from newer players both in online and brick-and-mortar space, something that could hurt Fabindia’s growth prospect going forward. For instance, Kolkata based Manyavar, which had just one store till 2008, has more than 400 stores across the country now and is expanding its portfolio from wedding and special occasions to everyday clothing.

Fabindia, in comparison, opened eight stores last fiscal and has added 14 doors in the current financial year. ET, last month, reported that the private equity arm of Louis Vuitton Moet Hennessy (LVMH), plans to sell its 8% stake in Fabindia.

(Published in The Economic Times)

Richa Maheshwari, The Economic Times
Bengaluru, 14 January 2016

The couriers ride geared bikes and carry packages of up to 7.5 kg per trip. With incentives, a bicycle messenger could earn about Rs 7,000 to Rs 8,500 a month compared with Rs 14,000 a month for those on motorbikes, according to people aware of compensation levels.

Online retail, which is being increasingly adopted by Indian shoppers, is expected to account for 3% of the total by 2020, according to a PwC report. Further, orders per million are expected to more than double from five million in 2013 to 12 million by 2016. While this will mean more opportunities for e-commerce companies, delivery staff will have to ensure goods reach buyers in time.

The US-based online retailer is working on novel methods of delivery, including Prime Air, "designed to safely get packages to customers in 30 minutes or less using small unmanned aerial vehicles, also called drones," according to its website.

The e-commerce giant is seeking delivery alternatives as logistics costs rise, experts said.

"In India, the density of population is higher, hence bicycles will help them reduce cost compared to motorcycles. Similarly, in the US, since the market is less dense, air cargos will help them reduce cost, reduce time and improve accuracy," said Devangshu Dutta, chief executive officer of consultant Third Eyesight. "The purpose is the same, how it is done is different, depending on the geography." Amazon said using cycles was green and enabled couriers to slip through traffic easier, when asked whether this would allow it to lower costs.

"Our focus for this initiative was two pronged – to be eco-friendly and to be able to cut through congestion in metro cities," it said. "You’ll find more people who own bicycles or if need be can afford to purchase one. It is lighter on the pocket to own a bicycle compared to a bike. We will see how it goes with Amazon with respect to safety and then decide whether we want to add bicycles to our fleet or not," said Vijay Ghadge, chief operating officer of GoJavas, primary logistics arm of e-tailer Jabong.

(Published in The Economic Times and The Times of India)

Shambhavi Anand & Varun Jain, The Economic Times

New Delhi, 6 January 2016

Discount sale on winterwear has started in the middle of the season, as an unusually warm winter has hurt demand, forcing top brands to tweak their strategies. Industry experts estimate India’s annual winter wear market at around $2.3 billion (Rs 15,300 crore). This year, sales are around 15% below the expected level because of a mild winter in the North, said two of them.

Brands such as Woodland and Marks & Spencer, which are high on winter wear, started selling winter wear in October, a month earlier than usual, expecting people to buy in anticipation of a harsh winter. While several of them are now replacing heavy woolens with light ones, brands such as Levi Strauss and Woodland started offering discounts on winter apparel, footwear and accessories as early as December 23.

"Due to the balmy winters this year, we at Woodland have tweaked our inventory at the stores accordingly. Since we see slow demand for bulky winter merchandise, we have stocked our stores with sweatshirts, fleeces, bomber and gilet jackets instead, which have been flying off the shelves. We also have a range of ankle boots, which have been the rage all winter and have replaced thigh high boots this season," said Managing Director Harkirat Singh.

Marks & Spencer is focussing on light knits, cable knits and cashmere jumpers this season.

"This winter, layering was a key trend. As every part of India does not face winter with same intensity, having a range of styles in linen refreshed in latest colours of the season really helps, so we continue to offer linen all year round," said Venu Nair, managing director of Marks & Spencer Reliance India. He refused to comment on current trading and trading over the last quarter citing the silent period before reporting its group results on January 7.

Pepe India, which is primarily a denim brand but also sells winter apparel extensively, launched its winter collection ahead of Diwali. "Normally we used to launch winter collection after Diwali, but this year we went ahead with it by October 15. We also reengineered our product line and brought more of sweat shirts and lighter denim jackets which are useful for a longer part of the season," said CEO Kavindra Mishra.

Most parts of northern India, which is a huge market for winter wear for apparel brands, has experienced warmer winter this year. According to the India Meteorological Department, minimum temperature as on Tuesday was 5-7 degrees above normal in places such as Delhi, Chandigarh, Punjab, Haryana and Himachal Pradesh.

"Winter wear is an extremely seasonal product and it is limited to a small part of the geography of India," said Devangshu Dutta, CEO at consultancy Third Eyesight. "From that point of view, the sales of winter wear would have got impacted." However, he said, it is too early until late January to term the season a write-off.

"We have seen that the weather patterns are fairly unpredictable; so you can actually get a cold snap in the middle of January and that time it pushes up sales."

(Published in The Economic Times.)

Devina Sengupta & Jochelle Mendonca, The Economic Times

Mumbai, 16 December 2015

Consumers could have a say in the watch or even car produced by the Tata Group as its companies strengthen social media and digital platforms by crowd sourcing ideas.

Titan, which sells watches and spectacles, will be among the first to start asking consumers for detailed inputs in the next few months. The plan may be replicated across consumer-facing units such as Trent and Tata Motors.

Such companies use listening tools based on social media feeds to manage brand and reputation, said a data analytics partner at one of the big four accounting and consulting firms that’s working with Tata on the plan. Titan and other Tata group firms are taking this to a new level, the person said.

Consumer feedback will be used to inform product design and service delivery, said the partner, who didn’t want to be named.

Crowd sourcing is a way of getting ideas and feedback from a large group of people, primarily those who are online, rather than from employees and suppliers.

"Titan is already doing it for some of its brands," the company said in an email.

More companies are looking at this to increase engagement with customers. Over the last two years, they have been resorting to crowd sourcing to identify features and product names. Sony decided to use the method to choose the name of its new speaker range last year, while McDonald’s asked UK customers to suggest recipes for its menu.

Tata MotorsBSE 2.05 % is no stranger to such exercises.

"We involve our audience in all our new launches, by creating content and communities built around their interests which resonate with the values of the car," a spokesperson said in an email. "Crowd sourcing and social play a key role in our awareness campaigns as we recently saw in the Zica name unveil campaign, where a multi-city scavenger hunt fuelled by digital was used to reveal the name." Zica is the latest model in the Tata Motors range.

Lifestyle and retail company Trent did not respond to queries.

Unfiltered inputs mean the management team can quickly connect with what the customer is seeking.

"With growing internet penetration, the ability to aggregate such inputs has expanded dramatically while the costs have dropped," said Devangshu Dutta, CEO of retail consulting firm Third Eyesight. "Certainly, it also makes the business and the brand more approachable and friendly, if done right.

It also helps provide a different perspective.

"Businesses can get locked into familiar strategic analyses and predictable behaviour and crowd-sourced ideas can provide perspectives that may be way outside the management team’s conventional thought processes,” Dutta said.

Tata group chairman Cyrus Mistry has been focusing on digital over the past few years and all group companies have been asked to get more consumer centric.

ET reported earlier that the conglomerate had mandated customer-facing businesses to appoint chief digital officers to improve their offerings. Former Citigroup executive Deep Thomas was named head of customer analytics in February.

The new push is in line with the group’s aim to become one of the top 25 global brands in the next 10 years and double its total market value to $350 billion. The group’s total revenue stood at $108.78 billion in the year to March.

The Tata group is expected to launch its ecommerce venture in December based on the marketplace model, similar to that of Flipkart, Amazon India and Snapdeal. It will offer both Tata and non-Tata products, mainly related to electronics and lifestyle.

(Published in The Economic Times.)