Retailing in designer wear segment

Worth of the entire apparel market in India is calculated to be around Rs 20,000 crore. In this, branded apparel market’s size is nearly one fourth or Rs 5,000 crore while designer wear market’s size is only about 0.2 per cent. Worldwide, designer wear market is currently amounted at $35 billion (approximately Rs 1,400 billion), with nine per cent growth rate, with the Indian fashion industry accounting for hardly 0.1 per cent of the international industry's net worth. At present, the largest sales turnover within the designer wear segment is about Rs 25 crore, with many well-known names having less turnovers of Rs 10 to 15 crore. However, many fashion designers and management experts foresee an average growth of about 10 to 12 per cent as the designer wear industry’s growth is projected to increase to Rs 1,000 crore by 2015.

 

Designers’ esclusività

Flooded with domestic and international brands of repute, Indian apparel industry is nearly on the verge of saturation. Notwithstanding this situation, the designer wear segment brings with it and promises newer scope and opportunity. Designers have mingled India’s rich and unique textile resource with international styles and understandings giving vent to an exclusive line of apparel that is very high in design and price as well. What makes a designer wear so exclusive? According to Rajesh Pratap Singh, “While branded high-fashion apparel tends to go along with the trends, there is more soul in a designer label.  It has more of a ‘consistent handwriting’ which is perennial and becomes almost ubiquitous in the brand.” Ritu Beri opines that when people buy clothing from designer boutiques because they want a label that is synonymous with exclusivity and quality.

 

Consumer metamorphosis

With apparel market consuming 63 per cent of the wallet share, consumers’ behaviour shows a new attitude, quite different from what it used to be a decade earlier. Indian consumers are increasingly veering towards high-end designer wear everyday. Generally, consumers for designer wear do have yearly household income of over Rs 10 lakh. Currently, there are three lakh such households developing at the rate of 40 to 45 per cent. Changing Indian culture (owing to inter-cultural and intra-cultural interactions) has coupled with western influence in giving rise to a well-travelled, aspiring and fashion savvy consumer base. Exclusive fashion events like ‘Fashion Week’, separate columns in prominent magazines, daily splashes in the much-talked about Page 3's and exclusive fashion channels have made Indian consumers more fashion-literate.

 

Fashion retail

Retailing of designer wears has a distinct and different mode of operation. It is mainly operated through haute couture and prêt lines. Generally, designers retail their products through their own flagship stores and also through multi-brand outlets in domestic and international markets.

 

Haute couture

Made to cater specific customers, haute couture is meant for a selected clientele. Owing to extensive detailing of design and usage of high-quality fabric, it is usually very expensive. Manish Arora says, “We undertake orders or especially design garments for select clientele who are willing to pay the price. As is the custom of couture, these wears are very expensive.”

Every label has its own specialty and identity. Experimenting with colour, texture, prints, dyes, fabric, style and patterns, designers bring out the best design element through their creations. With every fashion week (domestic or international), the fashion industry witnesses a new level of growth through these innovative minds.

 

Prêt-à-porter

Prêt line, a range that sells off the shelf, aims at a broader clientele-base. By reaching out to the mass with ready-to-wear clothing priced at Rs 300 to 3,000, prêt line stores make a business more scaleable. High streets are yet to be crowded by flashy prêt line stores. But, purse-friendly prices, sleek designs and trendy collection certainly show a positive growth of prêt wears in India. Realising that high priced couture line has a very limited clientele; designers are coming out with prêt lines. Mr Arora’s prêt line, 'Fish Fry', was launched in 2001 and aimed at tapping the growing demand for more affordable designer wears. He says, “It is a diffusion line that retails at a lower price point than my label. We have even done a footwear range for Reebok under that label.”

 

Designer’ clientele

“My clientele comprise beautiful women who have well-travelled and like to wear designer wear,” comments the designer duo, Nikhil Sahntanu. Adding, he says, “I can see that this group of women is growing at a very fast pace in India. There is a huge market; upper middle class is coming up. We are never going to be a mass market, but a bridge line with a price range of Rs 12000 to 40,000 that will enjoy patronage of this emerging affluent customer base.” Fashion is all about luxury as long as there is innovation. Says Mr Arora, “My target customer is women of 20 years and above. My clothing is for people who like beautiful wears and are into experimenting with trends. I was lucky that a number of people took to my style instantly and I developed a loyal customer base.” According to the popular notion, most of the designers target the women folk as their target group. However, there has been a conspicuous growth in the men’s wear section as well. These days, more and more designers are specialising in men’s wear. According to Raghavendra Rathore, “In my opinion, menswear is a larger equity in the present retail scenario in India.”

 

Retail strategy  

Mr Singh feels that self-owned outlets and multi-brand outlets help in enhancing the retail presence of the brands in their own individual ways. He says, “Our stores enable us to create a space, which speaks to our customers about the brand and its roots.  We scale up by also retailing in multi-brand stores.” He has four exclusive stores in India. His products are also stocked at numerous multi-brand outlets in India and abroad. Currently, they are working on their prêt line that will be launched very soon. Mr Nikhil has four flagship stores. These apart, they have their garments stocked in sixty multi-brand outlets across the world.  According to Mr Nikhil, “We are now working on how to leverage a brand nationalisation. We have segmented our collection into thirty per cent customised clothing and seventy percent bridge line collection. We aspire to see the label to be a successful high street fashion brand.” In a self written article entitled ‘Ritu Kumar’s Style Report’ on the website www.kiwicollection.com, Ritu Kumar reveals about her retail strategies and future plans. She says, “I work on six or seven collections simultaneously - they are meant for all ages (from 18 to 80). Opportunities are opening up to franchise and expand my label. Although I am looking at it hard, I don’t think that dress expansion is right for at this time.”

 

Corporate-label alliance

Alliance between corporate retailers and designer labels mark yet another avenue for the growth for designer wear segment. Mr Arora’s alliance with Reebok, Sabyasachi’s tie-up with Bombay Dyeing and the launch of Raghavendra Rathore collection in collaboration with Carmichael House, the home textiles brand of S Kumars Nationwide Ltd, (Total Home Expressions Division) are just some of the names in this avenue. For any designer brand to grow in Indian market, one cannot overlook the value of possibilities that a strategical corporate partner can bring in over the table. Mr Rathore feels, “Designer brands need to be flexible and open while the corporate needs to understand that ‘communication’ and support expected by the designer are carried out in a timely manner. Controlling distribution under watchful intervals can also be helpful.” Mr Singh says, “Designers lend their insights and interpretation to the product and brand they work with. However, these are still early days for evaluation of such brand tie-ups. Done professionally with a appropriate product mix, such tie-ups could be a win-win benefit for both the partners.”

 

Fashion trade events

The Fashion Weeks presents the new collection of the season offered by various designers. Presenting an array of designer wears all under one roof ready for consumers to pick and choose; the event is of immense scale and repute. It focuses on the business of fashion and provides opportunities to participating designers. For upcoming designers who get a chance to interact with the maestros of the fashion industry, it provides an ideal exposure. And, for students and aspiring designers, the event is a great source of motivation and inspiration. Ms Beri says, “Fashion Weeks attract a lot of domestic and international clientele. Also, it’s a great platform for encouraging and launching new talents.”  Mr Singh opines, “The Fashion Week gives the industry clear seasonal-time-tables. Besides the vast convenience it creates for the buyers, it provides a structure and organisation to the business of fashion. The event has enabled the industry to grow fast and it is now a very serious backbone for all stakeholders.” However, Mr Rathore is of the opinion that the Fashion Week in India is still evolving. It will, in near future, have many dimensions and modules, only to become a more suitable platform for all - the creative, the producers, the sellers, the image builders, etc.” Fashion Weeks in India are there with hoards of opportunities and potentials that are yet to be optimised. However, the day is not very far when the fashion weeks are going to emerge as the most distinguished trade events in the fashion arena giving equal scope for all the B2B and B2C interactions.

 

Impediment to growth

Despite huge potential, the designer wear segment is faced with a number of challenges. According to Mr Rathore, “Scarcity of retail options for high-end designer products creates a paradox for the Indian designer.  Sustaining and building the brand, despite the limitations, is a key factor that makes or breaks the designer.” Mr Singh opines,” Challenges are poised by retail space, designer brands are usually family run companies with limitations of financial and other expertise.” Indians have become more fashion-conscious and there is conspicuous retail boom. However, designer label stores are still less in number as compared to other apparel stores. Ms Beri opines, “The biggest challenge is to reach its proposed clients and make it known among the mass. The problem lies in distribution, promotion and the huge cost of building a brand. It is risky.” She explains, “Corporatisation of designer brands is a necessity. Indian fashion industry is just one and a half decades old and things will happen with time.” As regards availability of private equity options, Mr Rathore opines, ‘Best business models, uniquely designed products and good access are the needs of the hour for apparel brands. Designers should have a better infrastructure and good understanding of the business of fashion.”

 

Annotation

It is time for designer labels’ complete makeover or transformation: from being a page three dependent, family-run units that thrive on the exclusivity of designs into the inevitable, everlasting, self-sustaining, highly commercial and lucrative brands. With the boom in the retail sector, finance will flow into the marketing engines of theses designer labels competing for the market share. With smart advertising strategies and proper visibility in the retail scenario, these labels are soon to have a hard hitting impact upon the luxury segment.

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