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June 9, 2023
By Pavan Lall, Fortune India
Jun 9, 2023
For fashion designer Tarun Tahiliani, getting funding from a corporate house was incidental. It happened through a high-profile customer, none other than Aditya Birla Group chairman Kumar Mangalam Birla. Birla had been a customer of Tahiliani’s Ensemble some three decades ago when he was getting engaged. They stayed in touch over the years and at one stage discussed the need for an Indian fashion brand focused on scale and accessibility. “It came out of a conversation and was a two-year ambling route. I had asked if they were expanding their designer brand footprint, and he (Birla) told me to meet the Aditya Birla Fashion and Retail (ABFRL) CEO for a deeper chat,” recalls Tahiliani.
The result was Tasva, a sub-brand that Tahiliani has a minority stake in. The focus was to zero in on the ethnic space, not lose out on the homegrown touch, yet keep user-friendly clothes in traditional silhouettes at accessible price points that were not haute couture. Launched in December 2021, Tasva primarily caters to the premium occasion-wear segment, and has been growing at a fast pace.
Raising Cash
Tahiliani, who got ₹67 crore funding for a third of his company with an option to further offload up to 20%, isn’t the only one to see corporate finance push capital into his designs and stores. Sabyasachi Mukherjee of Kolkata, who opened a large multi-level store in a heritage-style building early this year in Mumbai, sold a little over half his company to Birla, reportedly for around ₹398 crore. ABFRL has also bought a 51% stake in House of Masaba Lifestyle, the entity that houses apparel, personal care, and accessories businesses under brand ‘Masaba’ owned by designer Masaba Gupta. Besides the Aditya Birla Group, Mukesh Ambani-led Reliance Brands has bought a 52% stake in Ritu Kumar, 51% in Abu Jani Sandeep Khosla, and 40% in Manish Malhotra. Earlier, in 2008, Kishore Biyani’s Future Group took a 23% stake in Anita Dongre, which was later sold to private equity player General Atlantic for ₹150 crore.
“While we are reaching a sense of critical mass in terms of consumer base, luxury is not new to India. Designers have been flogging their wares for decades,” says Devangshu Dutta, founder of Third Eyesight, a consultancy firm focused on consumer goods and modern retail. “What has changed is the size of the target audience.”
According to a recent Knight Frank wealth report, India is set to see a projected 58.4% increase in ultra-high-net-worth individuals, those with a net worth over $30 million, from 12,069 in 2022 to 19,119 in 2027. The domestic apparel market, too, was pegged at $60 billion last year, not far behind the developed world, a McKinsey’s FashionScope report has said.
“Earlier, India was a country that just produced for the world. Today India is also becoming the largest consumer market. International brands are keen to invest in business relationships with India. India will change the game for luxury. Where else will you get a billion people who are of a young age, and will be the future luxury buyers of brands?” says Sabyasachi.
“The economy has expanded beyond bigger cities, which has raised the consumption size” adds Dutta of Third Eyesight.
Corporate Handholding
“Corporate involvement helps scale faster than organically, and a lot of designers are tying up with companies with technical expertise and go-to-market for smaller towns and cities,” says Anita Dongre. “For a designer, having a corporate brings in processes, technical expertise and management know-how, and helps her focus on designing,” she adds. In Sabyasachi’s case, too, a new CEO — Sumati Mattu, as well as a new HR head and COO, were brought on board to prepare for the brand’s expansion.
For Sabyasachi though, it has helped in creating a safety net, especially for his employees, more than anything else. “Right now we have two investors — me and Birla together, so it makes me feel protected. Nothing else has changed. The only thing that has changed is that we have a great HR policy with the Birlas; they will be able to look after my people better, as I have created a beautiful safety net for all my employees.”
Dutta, on the other hand, says that “for large companies in the fashion space such as Aditya Birla, it is a natural step to buy into an established brand with scale since brand recognition combined with capital and organisational structure make for a win-win. The platform of fashion is currently at the right juncture to replicate networks and create scale,” he adds.
Other designers, including Manish Malhotra, who has also received funding from Reliance, say, “corporatisation of fashion houses in India has brought about a safety net for luxury brands, making us push for larger creative forces and expansion in terms of scale, branding and customers.”
Growing Into India
Tahiliani says we have opened 55 Tasva stores and will reach 90 in this financial year. Tasva crossed around ₹60 crore in annual revenue in 2022, and is set to hit ₹200 crore this year, he adds.
Similarly, Dongre, widely regarded as the largest designer and fashion house by revenue, has around 150 stores across brands, and Global Desi, a substantial increase from the 10-15 stores she ran before receiving her first funding. “The added benefit is that such funding helps push into international markets.” While Dongre launched her stores in Dubai and New York a few years ago, Sabyasachi launched a New York-located store in West Village last year.
So, what’s the road ahead?
“Corporate India has successfully built large-scale fashion businesses and acquired international brands, but has not been able to create a homegrown luxury brand of cultural or social significance. That will change now,” says Sabyasachi. Jewellery is set to be his focus, along with sunglasses, beauty, shoes, and other categories. “Jewellery is a very important category in the country, a great revenue earner,” he says.
“The film industry was corporatised because its potential was discovered, now it is fashion’s time,” adds Manish Malhotra. “Corporatisation lets designers look beyond bridal-wear, occasion-wear, and focus on newer creative strategies as there’s more space and potential for experimentation.”
Tahiliani agrees that compared to overseas, the trend is an expected one. “Most of the brands abroad have seen stellar growth because they have been aligned with corporate houses.” He points to the famous Alexander McQueen, who started in 1992, and was discovered by Isabella “Issie” Blow. The tie-up allowed him to expand his label, open boutiques around the world, and push into the categories of perfume, eyewear, accessories trainer and clothes for men.
Globally, France-based Kering group owns designer labels Gucci, Alexander McQueen, and Balenciaga, among others. LVMH Moët Hennessy Louis Vuitton, commonly known as LVMH, owns Loro Piana, Fendi, Christian Dior, Kenzo and Marc Jacobs.
The question then is, with all the global exposure and corporatisation, will there be a shift in Indian design sensibilities?
“Now you see people wearing bold gowns or black ties for one or two events, but Indians have kept a unique spirit of celebration and culture unlike anywhere else in the world. Bollywood has played a huge part in amplifying this because of the song and dance and colours and events such as Holi and Sangeet,” feels Tahiliani.
The bottomline: Luxury fashion is now more inclusive, and regional customers are the next big target area for brands.
(With inputs from Priya Kumari Rana)
(Published in Fortune India)
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July 8, 2022
Akash Podishetty & Krishna Veera Vanamali, Business Standard
New Delhi, 8 July 2022
India’s $900 billion retail market has emerged as one of the most dynamic industries and is expected to reach anywhere between $1.3-$1.5 trillion by 2025. The organized retail is seen gaining 15% market share in the overall retail space, while food & grocery and apparel and lifestyle may account for 80% of India’s retail market by 2025.
Large market offers big opportunities. And it looks like Reliance Retail has seized it, with its massive omni-channel retail play of physical stores, B2B with kiranas and e-commerce.
The company went on an acquisition spree and partnerships in the last three years, adding to its portfolio some of the biggest names, including Hamleys, Dunzo, Zivame etc.
It has also partnered with famous global retail chain 7-Eleven. Catering to India’s affluent consumers, Reliance, meanwhile, houses some of the most iconic brands such as Versace, Armani Exchange, GAP, GAS, Jimmy Choo, Michael Kors among others. The premium segment has become one of the fastest growing categories.
Also firming up its inorganic play, the company is planning to acquire dozens of niche local consumer brands to build a formidable consumer goods business.
Arvind Singhal, Chairman and Managing Director, Technopak Advisors says, there’s focus on physical retail expansion. Reliance is looking to cater to both price conscious and brand conscious customers, while trying to capture as much of the private consumption market as possible, he says.
Reliance Retail’s competitors are nowhere close to even put up a fight. The company has over 15,000 offline stores across categories, compared with DMart’s 294 stores or Aditya Birla Fashion’s 3,468 outlets.
Reliance retail’s revenue has grown five times in the last five years and the core retail revenue of $18 billion is greater than competitors combined, according to a Bernstein report.
Speaking to Business Standard, Devangshu Dutta, CEO, Third Eyesight, says, Reliance wants a decent share of Indian consumers’ wallet. From that perspective, Reliance still has a long way to go, he says. As consumer preferences evolve, Reliance too should adapt.
An undisputed leader in the domestic market, the aim of Reliance, according to Mukesh Ambani, is to become one of the top 10 retailers globally. Part of this bet is based on the premise that incomes and consumption power of Indians will increase across the board in coming years. However, could the uneven recovery that different segments of the population have seen stop the pie from growing larger and prove to be a dampener for Ambani’s ambitions?
(Published in Business Standard)
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November 28, 2021
By Rasul Bailay & Writankar Mukherjee, Economic Times
November 27, 2021
Reliance Retail aims to be one of the world’s top retailers, but for the last couple of years, it has been a buyer, not a seller. It has bought a string of retail brands — from online pharmacy Netmeds and online furniture retailer Urban Ladder to digital lingerie seller Zivame, online grocer MilkBasket and haute couture label Ritu Kumar. The latest acquisition was Sri Lankan lingerie brand Amante.
These acquisitions are crucial cogs in Reliance Retail’s further push into brick-and-mortar and ecommerce, and are part of Mukesh Ambani-led Reliance Industries Ltd (RIL) unit’s larger strategy: To break into the global top ten retailers. India’s largest retailer (by sales as well as by the number of stores) is currently ranked 53rd in the world, according to Deloitte’s Global Powers of Retailing 2021. Reliance Retail reported an annual revenue of $22 billion and a net profit of $750 million for the fiscal year ending March 2021.
At the same time, the company is looking beyond pure retailing. It’s pursuing a larger play to tap into the growing pie of the country’s overall consumption story — from contract manufacturing to distribution of everything from affordable fashion and consumer electronics to grocery products in India’s $850 billion annual retail market that is expected to swell to $1.3 trillion in the next few years. (Reliance did not respond to ET’s questionnaire.)
Analysts say Reliance’s overall plan is to engage India’s burgeoning consumers in its ecosystem one way or the other at any given point of time: shopping in its vast network of physical stores or on JioMart ecommerce platform, using Jio’s mobile or WiFi networks, watching movies on Jio Cinema, paying through Jio wallet so on and so forth that it is dubbed by the petroleum-to-telecommunications conglomerate as “retail plus” strategy.
“Their plan is to weave their products and services so deeply into your life that from morning to evening you are spending time and money on their networks either directly or indirectly,” says a top executive of an online grocery retailer. “Their idea is to constantly keep consumers engaged in a Jio bubble or in a Jio world.” The executive estimates India has a middle class of around 40 crore people. “Even if they succeed in capturing 10% of that wallet share, it is going to be huge,” he says.
That’s the reason Reliance Retail is betting big on business-to-business (B2B) ecommerce, with a digital wholesale marketplace along the lines of Alibaba for products such as smartphones, televisions, garments and grocery items, among other products, according to people aware of the plan. It’s looking to service a whole gamut of retailers in cities and villages.
Reliance has already started distributing its licencee products of Kelvinator- and BPL-branded consumer electronic items and its smartphone JioPhone Next, produced in collaboration with Google, to retailers outside of Reliance’s stable. The company also boasts a whole host of private brands and many of them are making inroads into general trade.
“The market for modern retail and ecommerce put together would be 15-20% in India. The rest 80% is still in the traditional market. If Reliance can make an entry into the traditional market and partner the smaller stores, the opportunity for growth and revenue is much more,” says an industry executive aware of the plans.
“Reliance’s approach is not to be a threat to small stores or merchants, but to be their enabler, provide them merchandise at best wholesale rates, upgrade their stores and even list them on their ecommerce platforms to help them reach newer consumers,” he adds.
Reliance is doing exactly that. Earlier this year, it started supplying Puric InstaSafe-branded FMCG products like soaps, home disinfectants and sanitisers to kiranas in Punjab and West Bengal. It is planning to roll these items nationwide. The company has put in place a marketing team for the first time to push these products. Similarly, B2B portal Ajio Business is selling T-shirts for Rs 79 onwards, a pair of jeans for Rs 220 and shirts for Rs 170 onwards to small businesses. Last quarter, Reliance Retail forayed into the wholesale business of medicines through Netmeds by roping in neighbourhood pharmacies under its B2B initiative.
These are some of the steps in the conglomerate’s bet not just on pure retail play but on end-to-end gameplay in the retail ecosystem, controlling manufacturing, wholesale, supply chain, ecommerce and payments.
To augment its digital wholesale plans, Reliance Retail has already converted its network of cash-and-carry outlets into fulfilment centres.
Analysts say Reliance’s ambitions are long-term and capital intensive and the company is ready for the long haul and to spend. “Reliance’s plan to rope in and aggregate many elements together — retailers, B2B buyers, suppliers, small players — and bring them on board takes time and is a capital-hungry business,” says Devangshu Dutta, chief executive of consulting firm Third Eyesight. “But controlling end-to-end is Reliance’s game plan in any business, including telecom, where it spans the entire value chain of not just providing the mobile network but also a digital interface with consumers.”
In a bid to feed its ambitious consumption plans, Reliance Retail is lapping up stores and warehouses nationwide to service both ecommerce and B2B sales through its “new commerce” omnichannel plans that will also involve legions of kiranas as last-mile delivery agents as well as buyers of Reliance’s products. Reliance Retail, which operates more than 13,000 stores of various formats, plans to open around 5,000 outlets of its Smart Point that would entail a convenience store, a pharmacy, agnostic centre, a telecom services and financial services products outlet all rolled into one across the country.
Reliance is planning to take this format to even tehsils, according to sources. Real estate agents and mall executives say Reliance is scouting for space for supermarkets, fashion outlets and jewellery and footwear stores.
They say Reliance is also planning to enter newer retail formats like a department store chain to compete with Shoppers Stop and Lifestyle. Also in the works is a Sephora-style beauty and cosmetics chain, they say.
“We will focus on expanding our store footprint multifold this year with co-located delivery hubs over the next few years. They will provide a strong network to reach and serve millions of merchants and customers,” Ambani said at the last AGM of shareholders.
Deloitte’s Global Powers of Retailing 2021 report ranked Reliance Retail as the world’s second fastest growing retailer, behind South Korea’s Coupang Corp.
Global financial and tech titans have taken notice of Reliance Retail’s play and pumped billions of dollars into it. Last year, the holding company Reliance Retail Ventures Ltd raised Rs 47,265 crore by selling about 10% stake to some of the biggest names in global private equity, including Silver Lake, KKR, General Atlantic, Abu Dhabi Investment Authority and TPG.
Reliance will continue with its acquisition spree, say analysts. However, Reliance Retail’s largest, the Rs 25,000 crore acquisition of Future Group, is bogged down by Amazon’s opposition to the proposed deal.
(Published in Economic Times)
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April 21, 2021
Debojyoti Ghosh, Fortune India
April 21, 2021
Billionaire entrepreneur Kumar Mangalam Birla-led retailer Aditya Birla Fashion and Retail Limited (ABFRL) has continued its build-up in the ethnic wear market with its fourth deal since 2019 and second this year. In February, the Mumbai-based fashion retailer picked up a 33.5% stake in fashion designer Tarun Tahiliani’s Goodview Properties—that will own and operate the designer’s eponymous couture label—for ₹67 crore. That was a month after ABFRL acquired a 51% stake in Kolkata-based designer Sabyasachi Mukherjee’s company, Sabyasachi Couture, which sells garments, accessories, and fine jewellery, for ₹398 crore.
ABFRL, which owns fashion brands such as Louis Philippe and Van Heusen, said in a statement that ethnic wear “is a large and growing market with a significant opportunity to build scale” and expects it to be an important category over the next few years.
Experts note the two recent deals come as the luxury industry, including fashion, has been hammered by the pandemic. The year-long shutdown in global travel has slowed over a decade of growth across luxury categories. Indeed, the global fashion industry’s profit is expected to have slumped about 93% in 2020, according to a report by consulting firm McKinsey and The Business of Fashion in December.
“[Luxury] business has been hit hard during the pandemic, like all fashion and retail businesses. And a significant injection of money is needed to maintain the business momentum, and to scale it further,” says Devangshu Dutta, chief executive of retail consultancy Third Eyesight.
In March, Italy’s billionaire Agnelli family—best known as the founders of automaker Fiat—acquired a 24% stake in French luxury shoemaker Christian Louboutin for $642 million. Three months before that it paid $95 million for a controlling stake in Shang Xia Paris, a Chinese luxury goods business founded by French luxury brand Hermès and Chinese designer Jiang Qiong Er.
Many fashion firms have used the Covid-19-induced slowdown to reshape business models, streamline operations, and sharpen their customer propositions, said the report by McKinsey and The Business of Fashion.
And that is exactly what Tahiliani plans to do with his new corporate partner. The duo will create a new entity—80% held by ABFRL and 20% by Tahiliani—to launch a new brand of apparel and accessories in the affordable premium ethnic wear segment, while it also plans to launch a men’s ethnic wear brand.
“Discussions with ABFRL have been in the works for nearly two years. I couldn’t be happier about entering into this partnership. They understand scale and numbers like no one else in the market today. Each of their home-grown brands is a resounding success,” Tahiliani, founder and CEO of Tarun Tahiliani Brand, tells Fortune India. “This collaboration permits me the financial freedom to focus on designing,” he adds.
ABFRL aims to build the new ethnic wear brand into a ₹500-crore business in the next five years, with more than 250 stores across India. The first tranche of stores is expected to open by September. “This new entity with ABFRL currently concentrates only on menswear. In our collective opinion, at present, there is only one branded national player in the Indian ethnic [wear] for men space. In order to scale this up, we need to be in three or four categories of clothing. This will give depth, both in terms of style and sizing to the men who come into the store,” says Tahiliani.
Currently, the top panIndia ethnic wear brand for men is Vedant Fashions’ Manyavar. The Kolkata-based company forayed into women’s wear in 2016 selling lehengas, saris, and the like under the label Mohey,
ABFRL’s previous deals in the segment—both in 2019—were a 51% stake in fashion designers Shantanu & Nikhil’s Finesse International Design for a reported ₹60 crore, and its ₹110-crore acquisition of Jaypore. Both make apparel, footwear, accessories, and other items.
ABFRL’s managing director, Ashish Dikshit, declined to comment for this story. ABFRL had, when announcing the Sabyasachi Couture investment, said it expected that deal to accelerate its strategy to build a comprehensive portfolio of brands across segments, occasions, and geographies.
Experts say ABFRL’s recent investments allow it to tap into the designer’s creative stream and goodwill, while providing the financial and organisational muscle of a large corporate. Albeit one that is not aiming too far upmarket.
“We shouldn’t see the ABFRL [stake] acquisitions as entry into couture, which is a different business from the ready-to-wear market. It is the expansion of these brands into ready-to-wear, tapping into the desirability of the designer brand, while making it accessible and affordable to a larger market is what will be of interest,” says Third Eyesight’s Dutta.
Indeed, Mukherjee, in a press release in late January, noted, “As my brand evolved and matured, I began searching for the right partner in order to ensure continuity and long-term sustainable growth.”
Nonita Kalra, a veteran fashion editor, says that the ABFRL deal shows the growing heft of the [Sabyasachi] brand in the fashion business. “Corporates aren’t sentimental. They are hard-nosed about investments, with careful due-diligence. ABFRL is paying what it is worth and expecting it to grow bigger. They are never going to invest in a stagnant business,” she says.
Experts, though, caution that while corporate partnerships and acquisitions allow a designer-entrepreneur and their investor partners to unlock some of the value being built, it is essential to have clarity about each brand’s design language and target consumer. “With [ABFRL’s] new venture [in men’s ethnic wear with Tahiliani], the key thing to understand is how the company will differentiate it from Shantanu & Nikhil’s positioning and focus, which is also menswear-driven,” says Abneesh Roy, executive vice president, Edelweiss Securities. “The challenge will be ensuring that each brand maintains its distinctive identity, while deriving synergies from the group.”
ABFRL has stitched up some unique deals; it now has to ensure they don’t unravel.
(The story originally appeared in Fortune India‘s April 2021 issue).
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September 27, 2014
Alys
Francis, Nikkei Asian Review
New
Delhi, 27 September 2014
A few months ago, a group of wealthy industrialists and other
businessmen gathered in a plush Mumbai hotel suite to pore over
a selection of John Lobb handmade welted shoes that cost up to
$12,000 a pair.
It may just be a temporary “pop-up” store, but Thomas Collette, John Lobb’s commercial director for India, was excited. He said that a local agent for the bespoke shoemaker would start taking orders by appointment only. “This is a big step for us and a big step as well for the country,” he said.
Although international luxury brands have opened flagship stores all over developing Asia, they have hardly touched the Indian market. This may be about to change.
After all, many people in the population of 1.3 billion are steadily getting wealthier. According to the Associated Chambers of Commerce and Industry of India, luxury spending will reach $14 billion a year by 2016 compared with $8.5 billion in 2013.
But foreign luxury brands have had a tough time in the country, partly due to restrictions on investment.
Many major brands, such as Prada and Versace, only entered after 2006 when the government began to allow foreign investors in single-brand retail operations. Prior to that, foreign companies were only allowed to operate wholesale “cash-and-carry” outlets.
While companies welcomed the chance to open in India — albeit
with the requirement that a local partner owned at least 49% of
the business — they struggled with the lack of suitable retail
space and trained staff, bad supply chains, and a raft of customs
taxes and duties, as well as a long wait to turn a profit because
there was only a nascent market for their goods.
Since 2006, Prada and Gucci have been among the 50-odd brands that have either left India, restructured or quit soured partnerships, according to a 2012 report by retail consultant Third Eyesight.
In 2012, India started allowing full foreign ownership of single-brand retailers but included restrictions such as the need to source at least 30% of products from local small and midsize enterprises. That is virtually impossible for most luxury labels since their brand integrity often rests on the craftsmanship of products made in their home country. Unsurprisingly, the new rules did not trigger an influx of foreign brands.
Jones Lang LaSalle, the real estate company, in August ranked New Delhi and Mumbai near the bottom of its list of 30 major Asia-Pacific cities in terms of the presence of top luxury brands.
Indians optimistic
Some foreign brands, like John Lobb, have decided that franchise and distribution deals are a better way to establish their presence in a difficult market.
John Lobb’s local partner is Regalia Luxury, which spent a year wooing the Hermes-owned brand before securing a deal to sell John Lobb’s “By Request” line of shoes that are custom-made for each client.
Regalia Luxury is one of a number of Indian companies eyeing the rising number of style-conscious local shoppers who are hungry for Western luxury brands but are wary of entering the market on their own.
“From a longer-term perspective, there’s immense opportunity if you do it the right way,” said Regalia Luxury founder Pratik Dalmia, who clinched a franchise for bespoke Italian suitmaker Kiton in 2013 and expects to sign up two more brands by year-end.
But he admits that the market boom has yet to start and that operators will have to “run a tight ship” for the next couple of years.
Indian companies that represent foreign luxury brands need to have a long-term view and keep a close eye on what the younger generation likes — these are the customers with the most potential, since they are more exposed to overseas fashion trends.
“India is all about the customer of tomorrow,” said Darshan Mehta, CEO of Reliance Brands, a subsidiary of Reliance Industries that was set up in 2007 to bring foreign luxury fashion to India.
Mehta often sits in a cafe at DLF Emporio, New Delhi’s first luxury mall which opened in 2008, and watches shoppers. He said many people shop at Zara but they walk into Gucci and Zegna just to have a look. “That is what makes markets like India so promising: the aspirational consumer,” he said.
Unlike China, where a lot of luxury retailers are now at a consolidation stage after years of rapid expansion, brands are still struggling to find space in India for their first shops.
Even in Mumbai, the Emporio is the “only true luxury mall,” according to Mehta.
It may take some time before India’s luxury market takes off, but the market has been boosted by a stream of well-off Indian professionals and students returning after working and studying abroad, including many bankers who left Wall Street and London after the global financial crisis.
Luxury players are also expecting a boost from the introduction of a Goods and Services Tax, which was promised by India’s new government and would get rid of complex multi-level taxes that are hampering the sector.
Reliance Brands, which also represents Reiss and BCBG Max Azria, expects to add three more brands to the company’s stable of 16 foreign brands by year-end.
A few pioneers are even setting up boutiques in smaller cities. Bangalore firm Fervour, which has licenses to sell Nina Ricci and Christian Lacroix, is planning to expand to Chennai and Hyderabad.
But most don’t see these cities as viable markets just yet.
“There is no sustained luxury market outside of Bombay and Delhi,” Mehta said. He expects luxury demand outside the two main cities to take another three years to reach critical mass.
Sanjay Kapoor, the founder of distributor Genesis Luxury, said India’s luxury market is not yet at the point where China was 10 years ago, even if the potential for growth is immense.
Kapoor founded Genesis Luxury in 2008 to sell foreign luxury brands in India and has deals with Jimmy Choo and Armani, among others.
“As awareness and retail space spread, demand will accelerate in smaller cities in the interior of India,” Kapoor predicted.
Tight ships
Amid the shortage of high-quality retail space, one option is to use the “shop in shop” model.
R&B International rents small spaces in other retailers’ stores to sell Australian luxury label Easton Pearson. The manufacturing firm supplied embroidery to the brand for years before nabbing a distribution agreement in India in June.
Dalmia also said he is in no hurry to open flagship stores for John Lobb and Kiton before 2016.
Instead he is targeting ultra-rich customers who want the pampering that comes with exclusive, by-appointment-only services. Clients are shown samples of Kiton’s made-to-measure suits and John Lobb shoes, and then measured by a trained team at a place and time that suits them, often at home in the late evening.
Collette said he’s been pleasantly surprised by how well the brand has been received in India. While the brand has wholly-owned stores in Japan and the U.S., Collette said it would have been impossible for it to enter India alone.
(Published in Nikkei Asian Review.)
