An eye for licensing

Vrinda Oberai : VO: What are your expectations from the two recent deals you’ve cracked? Ronak Sheth : RS: We have very high expectations from the two brands as they are both doing very well in the market and appeal to a wide range of consumers. Provogue is very fashion forward and upwardly mobile, while Park Avenue is smart casual. These deals will also allow us to diversify our product portfolio to include distributed brands, licensed brands and owned brands. It also gives us access to consumers who will eventually rise up the ladder to buying internationally branded goods. Vrinda Oberai : VO: What has been your experience so far with regards to licensing? Ronak Sheth : RS: We were the first licensees of an Indian apparel brand and incidentally, were the first licensee for a children’s brand as well. An exciting experience, the deal was a smooth process. As it was our first licensing deal, we learnt a lot, especially since it was the first time we tried to sell to the non-optical channel. It brought about a lot of challenges that were new and unexpected. We learnt that it is imperative to train this channel with regards to eyewear. Without proper training and expectation management, it can become an ‘overpromise and under deliver’ situation. It was through this deal in which we came to understand the other distribution channels. Eventually down the line, we realized that we really need to understand the brand owner, and that expectations must be realistic from both sides. Vrinda Oberai : VO: Are you planning to have stand alone/exclusive stores? By when are you planning to do so? If not, then why? Ronak Sheth : RS: If you mean by stand alone/exclusive stores for a particular brand—then, no. The sunglass segment of one particular brand is too small a product category to support having a store. However, if you mean stand alone exclusive store for all our brands, then yes, we do have plans. It all depends on the market and the location we find most beneficial. Vrinda Oberai : VO: What is your take on FDI in the multiband licensing being increased? Are you looking forward to that? Ronak Sheth : RS: We are neutral regarding this issue. We understand that the increased investment leads to greater efficiencies and a better market situation for consumers. However, from a nationalist point of view, I believe there should be a compulsory minimum holding of Indian partners as there should be some domestic ownership (as done in various Gulf countries). Vrinda Oberai : VO: What are the main checkpoints that you keep in mind (being a licensee), while sealing a licensing deal and zeroing on a prospective licensor? Ronak Sheth : RS: Key check points include assessing brand strength and positioning in the market. One must take into account the caliber of the promoters of the brand, the history of the brand, and the different product categories the brand is present in. Additionally, we find that royalty expectations are high compared to the current market situation as the Indian market is still in the early stages. Vrinda Oberai : VO: What have been the main stumbling blocks in getting into licensing? Ronak Sheth : RS: The biggest issues, or rather hurdles, are the perceived value of the brand being licensed and the demand for royalty in the product category. Furthermore, sales potential at the brand stores are low and hence the overall off take is low from the brand side. Vrinda Oberai : VO: You're mostly present in the eyewear segment, which other categories you're also present in? Do you have any such expansion plan? Ronak Sheth : RS: We were present in the footwear, watches, and accessories industries, however we ceased soon after as we wanted to specialize in one industry. We do intend to venture in other categories in the future. Vrinda Oberai : VO: What do you think is the future of brand licensing in India when compared to the markets abroad? Ronak Sheth : RS: India has huge potential for brand licensing as due to the population, the market is much bigger. Additionally, brand licensing hasn’t reached its peak, it is just picking up. Indian brands are also picking up and so are the licensing opportunities. Vrinda Oberai : Vrinda Oberai (VO): Does the launching of eyewear collection of ‘John Galliano Eyewear Collection’ involve a licensing deal? What are the other recent deals that you have sealed? Ronak Sheth : Ronak Sheth (RS): The launch of John Galliano eyewear does not include a licensing deal. We are exclusive distributors of this brand through a global licensee of eyewear manufacturers. Our most recent deal is the licensing of Provogue and Park Avenue sunglasses. Vrinda Oberai : VO: When it comes to being licensee of major international/national brands, how many such licensing deals is a part of your portfolio till date? Ronak Sheth : RS: We were licensees of Gini & Jony kids eyewear however we ended the agreement 3 years ago. Our current portfolio includes two licensing deals.