Mumbai: The global slowdown, setbacks and delay in expansion of its retail operations in India have not tempered Savile Row Co.’s managing director Jeffrey Doltis’ ambitions.
Doltis, 60, who has been involved with the family business that started in 1938 since he was 18, is hopeful of India becoming its second largest market in the next few years after Japan.
Market potential: Doltis says though there is a slowdown in the world economy, as opposed to Japan, China or anywhere else, India is exciting. Photo: Nisha/Mint.
The company entered India in 2004 with Forbes Gokak Ltd, but had to exit the market in mid-2010 as Forbes Gokak decided to withdraw from the retail business earlier in the year. A year later, Savile Row formed a partnership with Alok Industries Ltd as their exclusive licensee for India.
Speaking on the second chance in India and plans for the new partnership, Doltis admits “entering new markets is harder than first imagined”. He is hopeful of the present partnership having a “much better chance for success than the last one”. Edited Excerpts:
The partnership with Forbes Gokak was formed in 2004, but your presence in India has so far been limited.
We had five luxury stand-alone stores in India—three in Delhi and two at the Taj properties in Mumbai, but the rents that they were demanding killed the business. We also had a retail presence and our business with Forbes Gokak was successful. But Forbes decided to pull out of retail completely as they wanted to concentrate on their other businesses like shipping, travel and not-retail.
We parted amicably. They had several brands Daks, Trussardi and Savile Row, and they closed the whole division.
Tell us about the partnership with Alok.
We met Alok Industries about nine months ago and at that time we met with many prospective partners.
We felt Alok has the proper technical know-how to have the quality control to protect our brand in India. Alok has the exclusive licence to sell Savile Row Co. in India. They have a five-year agreement and we hope that this is the start of a very long-term relationship.
Would you look at Alok Industries for manufacturing for your global operations as well?
We are in active discussions with Alok for a wide ranging partnerships.
In 24 months’ time, we would look at importing shirts made by Alok for the UK markets. Annually, we import about 7 million shirts in the UK from China and Turkey, and we could look at importing 10% of that from India.
What kind of investments you are looking at?
Alok is making substantial investments in the business with us. They will manufacture and retail, and we will make big investments in the branding, model photography, marketing collaterals and design. We are not sharing the investments as yet. In the first year, we will do shop-in-shop with H&A (the retail business chain of Alok Industries) in 25 stores and after that we will review the partnership for rollouts. H&A has over 220 stores...
Would you consider a joint venture with Alok Industries?
Yes, as the relationship develops we would look at a joint venture two to three years down the line. At that point, we would also consider opening stand-alone stores.
This is a new consumer segment that you are now targeting with Alok Industries.
Yes, because of Alok’s strength in manufacturing we felt that we can cater to a much wider public and give them a chance to buy Savile Row products which has been designed by our designers. Forbes did not really have manufacturing capabilities and was not fully behind pushing the brand out and making the investments, which I feel that the Alok group of companies is prepared to do.
Who would be the Savile Row customer in India?
He would be 30 years-plus businessman. He would buy work shirts as well as leisure shirts from us. The range is affordable and still luxurious.
Does that mean that you are moving away from the luxury market?
With this particular partnership, yes. This partnership is for readymade brands and for a wider public. This is luxury clothes at affordable pricing and not luxury clothes at unaffordable prices like the top-end brands.
What has been your experience with the Indian consumer?
The Indian consumer in India is slightly different. For this market, you require more colour in the designs. We have worked on having the whole UK range here and added some additional colours to it. Over 50% of the shirts we sell in the UK are white and blue, and we expect that these colours will be just 30% of sales here. The Indian consumer is as demanding as the UK consumer and he requires a lot more colour as well. He is price conscious and will not over-pay. He is very savvy.
What happened to the partnership with New Delhi-based Study By Janak?
That is going ahead. We will open two stores in Delhi, which will be for the top-end consumer, catering to bespoke tailoring.
What are the challenges in retail in India?
There is a shortage of good shopping malls. It’s about finding locations where brands like ours can thrive. The retail property market is difficult in India. The landlord expects too much from the tenants.
You are entering at a time when the Indian economy is being affected by the global slowdown and high inflation. Is that a concern?
There is a slowdown in the world economy. As opposed to Japan, China or anywhere else, India is exciting. The demographics is in India’s favour and that is why we are excited about the Indian market.
Would you look at different channels like catalogue retail in India?
Yes, in three to five years. We would look at establishing a good retail channel first and then with our partners establish catalogue retail in India.