As the Indian retail industry is progressing aggressively, more and more international brands are eyeing to venture into the Indian market. Besides, the booming e-commerce sector has added on to the growth of this industry.
According to the IBEF report, the Indian retail sector was estimated at $520 billion and was among the largest employers in the country in the year 2013. By 2018, the Indian retail sector is likely to grow at a compound annual growth rate (CAGR) of 13 per cent to reach $950 billion. Food and grocery is the largest category within the retail sector with 60 per cent share followed by the apparel and mobile segment.
As the retail industry is expected to move on a progressive trend, easing of FDI policies by the new government has opened up avenues for international retailers to join the race.
Recently, Amercian luggage brand Hartmann entered the Indian market by opening its first store in Bangalore, with plans to open another five outlets by end of next year. Samsonite South Asia, makers of Samsonite and American Tourister, which had acquired Hartmann, will be targeting to capture the top end of the market with the brand.
Commenting on the launch, Ramesh Tainwala, Global CEO, Samsonite said. "We were missing a play at the top end of the market and to be able to capture that, one needs a story and a brand with the right DNA. Hartmann is a brand that we would like to position as classic American luxury."
Besides, some global brands are not only eyeing the Indian market, but are also planning to expand their roots through various channels. Offlate, the growth of luxury retail in India has been a driving force for global brands to venture into the country.
Elaborating on his views about entering the Indian market, CEO of Jamin Puech Paris, Christophe Kapusta said: “There are two main reasons why I chose the Indian market. Firstly, our presence in Asia (particularly in Japan and China) is getting wider via EBOs and MBOs, and this is rational for us to keep expanding in the region. Also, we believe the exclusive and refine design of our bags should definitely be appealing to our Indian clientele, who are very sensitive to seek refined fashion products.”
Indian consumers and their preferences have changed over the years, and many retailers are considering it to be a positive factor to invest in India.
Sharing his thoughts about the Indian market, Rafael Vanthoor, Chairman, Berghoff, said: “I think that the Indian market is a fast growing market. It is a perfect market. People in India have the buying potential, but at the same time, they are very price sensitive in nature. Indian consumers have the right preference for quality products and that’s what we offer.”
In a nutshell, it can be concluded that dynamic progress in the retail segment is pulling international brands to venture into the Indian market. Besides, factors like increasing per capita income and demand for premium products has further lead to an increase in this trend.