International vs local : It is about the ‘Survival’ of the fittest
Incense is just very small example regional retailer doing something extraordinary,brands such as Fab India, W, Ritu Kumar, BIBA, AND, Allen Solly, Van Heusen etc., which have been quite successful here, and on their way make it big in international arenaBY Shipra Srivastava | Mar 20, 2017 | comments ( 0 ) |
International brands such as Zara, H&M, and Forever21 etc. have started taking sizable share in Indian fashion market. Indian consumers have started prefer these brands for their perceived quality, fit and style. So, does that mean local retailers have no chance to stand out to these brands? Well, the comparison of premium international brands to small, local retailers is like comparing apples to oranges. The comparison is unwise in every sense!
However, there are few regional/local retailers who are ruling the busiest shopping areas of the city. Let’s take the example of Incense, a fast fashion brand (mainly catering women’s fashion) which was incepted in 1999 marking a humble beginning at Sarojini Nagar market, New Delhi. Presently, the brand has five stores spread across Delhi. The brand is already a super hit among the locals. During the winters, the length of the queue at cash counters surpasses the store surroundings and goes till pavement area. Now we can imagine how successful the brand is! But, the question is, how such brand stand-out to any international biggie? Or these brands are just a fancy of value shopper?
How locals are achieving global nirvana?
In an exclusive conversation, Dheeraj Narang, Director, Incense, said, “H&M and to some extent Forever21 has given us setback. Though we have maintained steady sales since these two brands have foryed indian market, we are still on lesser price margin than them, and we are offering same quality of fabrics and garment that they selling to you.”Speaking on yet another premium fashion retailer Zara, he said, “Zara is not all our competition at all, we are on upper side in terms of price point. Our SKUs range is much higher to this Spanish retailer. We keep 15,000 SKUs in single store of ours.” On footfall, Narang informed, “At 5000 sq.ft store, averagely, we get the footfall of 1500 which escalates up to 2000 on weekends.” The brand has 35% sale conversion of this footfall as he informed.
Even global fashion icon Zara started as a local Spanish brand.and now the brand has more than 2000 stores spread across the world. Today, it is a perfect case study on how local apparel brands can achieve global success.
As of now, Incense is retailing 10 to 15 categories with strong focus on ‘Tops’ and ‘Dress’ categories. The brand does not follow any Catwalk trends, all designs are done by local fashion designing students. It’s top category refills at every second month, and the brand offers at least eight to ten colour option on every SKU. No other brand offers such wide colour range except on basic products like T-shirts. Unlike to international brands, Incense does all products hardly four months in advance to remain the best in terms of following latest trends.
Usually, all leading brands including H&M and Zara do the production at least 18 months before introducing the merchandise in any particular market.
Incense will be operational at least 10 new locations in Delhi/NCR by the end of this year. “We will continue to focus on crowded markets as we will expand our reach. We do not prefer expansive rental places. There are many new markets in Delhi which has so much of potential, let’s take the example of Krishna Nagar market; it is alike to Chandni Chowk. We are just waiting for GST roll out.” The brand is also mulling over franchise model for further expansion.
The brand is also mulling over various technological solutions to compete with international counterparts. In the pilot phase, the brand is planning to install small sized digital screens to explore live catalogue of that particular store in stores. Trial Mirrors will also install in the initial phase of development. As of now, the brand is offering no loyalty programme, but plans to introduce app based loyalty programme soon.
Learning for others
Success of traditional retailer like Incense gives following leanings to be successful retailer.
. Follow market trends and not just Catwalk and Instagram
•Identify the target market; understand “everyone” is not the target market.
•Analyze and adapt to the company’s finances wisely.
•Conduct a formal SWOT analysis of the company (strength, weaknesses, opportunities and threats).
•Communicate with the customers.
Incense is just very small example regional retailer doing something extraordinary , there are many brands such as Fab India, W, Ritu Kumar, BIBA, AND, Allen Solly, Van Heusen etc., which have been quite successful in the domestic market, and on their way to make it big in international arena.
No doubt, the distinct trends in the macroeconomic scenario, the favorable demographic dividend, retail specific policies, and consumer buying behavior, have triggered a transformation in the fashion retail market which is also reflected changes in domestic fashion market.
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