Panelists – from Left to Right:
Vasanth Kumar, ED, Max Retail; Rahul Mehta – President, Clothing Manufacturers Association of India; Darpan Kapoor, Vice President, Kapsons Fashions; Vineet Gautam, Country Head, Bestseller India; Vinay Nadkarni, MD & CEO, Globus Stores Pvt Ltd
Moderated by Rahul Mehta, President CMAI
What is the one trend that has been driving Indian lifestyle retail in recent years?
• Having established 100 stores across 40 cities, the strategy that has worked is “Affordable Fresh Fashion”.
• Retailers have a choice – 75% margin, with 2 inventory turns a year or 35% margin on 8 turns
• We operate at a 40-42% margin and turnaround stock 6 times a year.
• Store profiling is the key to this business
• We price our products sharply to allow us to turnaround stock within 60 days.
• We have been following this strategy since 8 years i.e. the beginning of Max Retail.
Our high level of inventory turns makes us immune to market discounting.
Vasanth Kumar, ED, Max Retail
In the world of brands, style is the key.
• Kapsons aggregates key international brands.
• There is huge awareness about international brands as India follows the West in terms of fashion.
• Earlier, we used to turnaround stock almost 6 times a year.
• However, due to growth in our brand value, now we turnaround 4 times a year.
Darpan Kapoor, Vice President, Kapsons Fashions
Customers are willing to pay (full price) for international brands.
• Consumers are looking for value from lifestyle spends.
• We are witnessing surging demand from Tier 2 and Tier 3 cities.
• 60% demand is from women’s fashion. The trend these days is for mothers & daughters to shop together.
Vineet Gautam, Country Head, Bestseller India
• Demand for women’s wear is at its peak.
• Trust is an important factor whereby customers are looking towards lifestyle stores to validate the information they already have from Internet and other sources.
• Lifestyle stores need to appreciate the time spend by customers in the store and make their experience worthwhile.
• Online retailing is certainly challenging our business but we do need brick & mortar stores as a mode of distribution.
Vinay Nadkarni, MD & CEO, Globus Stores Pvt Ltd
Is e-commerce is threat or an opportunity?
• E-commerce is very exciting for all retailers. However, brick & mortar retailers like us should enter the online space for product validation and not to make profits.
Darpan Kapoor, Vice President, Kapsons Fashions
• Retailers today need a good mix of brick & mortar stores as well as a good online presence.
• We have seen a 6% growth in six months owing to our strong e-commerce website.
Vineet Gautam, Country Head, Bestseller India
Why are value stores venturing into fashion formats?
• Convergence of technology and services is a growing trend.
• Value formats in fashion are a way to tap unmet aspirations among budget shoppers.
Vasanth Kumar, ED, Max Retail
• Customers don’t want to be seen as buying value products.
• However, all purchase decisions are driven more by value proposition than brand consciousness.
• Value retailers are entering fashion to try and straddle this balance.
Vinay Nadkarni, MD & CEO, Globus Stores Pvt Ltd
Why are end-of-season-sales (EOSS) growing in popularity among lifestyle
shoppers?
“EOSS demonstrates lack of strategy during non-sale periods” Vinay Nadkarni, MD & CEO, Globus Stores Pvt Ltd months.”
“Retailers must use EOSS period to introduce new stock and make it profitable at an overall level.” Darpan Kapoor, Vice President, Kapsons Fashions
“EOSS is a opportunity to correct mistakes of the whole year and the objective should be to reduce sale time.” Vasanth Kumar, ED, Max Retail
“Apart from clearing stock, EOSS is a way to draw footfalls and the trend is here is stay.” Vineet Gautam, Country Head, Bestseller India