Bed and bath linen retailer Bombay Dyeing and Manufacturing Co. has been trying to reinvent itself over the last two years, by moving away from its manufacturing heritage and becoming a retail brand.
The retail unit of Bombay Dyeing, part of the Wadia Group, has outsourced its manufacturing operations and is now rejigging its management, communication, go-to-market strategy and employee profile to reflect the transformation, a top executive said.
“We don’t want to live on the past laurels any longer. We want to reach out to the youth of today. That is a big agenda. This means everything we do needs to change,” said Nagesh Rajanna, chief executive officer, Retail, Bombay Dyeing.
Rajanna, who joined the company in April this year, is in the midst of implementing his 2020 vision, which involves tripling the retail unit’s topline to Rs1,000 crore from Rs300 crore in FY2016.
The company has unveiled a new look to be showcased across its consumer touch points, starting with product packaging and extending to store signage as well as its website in keeping with its aim of appealing to the millennial crowd (people who reached adulthood around 2000).
“By December the changeover will be complete across India,” said Rajanna.
The company is also moving towards launching three to four new products every year.
The go-to-market will see the company double its retail reach to 10,000 outlets across India by 2020. These are multi-brand outlets. Bombay Dyeing’s exclusive stores run by franchises will also increase to 500 from 200 in the same period. Its 30 company-owned outlets will turn into experience centres, Rajanna said.
During the last year, Bombay Dyeing took on board senior executives from companies such as Wal-Mart Stores Inc.’s Indian unit, Future Group and Samsung Electronics Co. Ltd.
Marketing head Micheal Nadar joined the firm in April from Samsung, Ganesh Ramakrishnan, head of finance, joined in August from Bharti Airtel Ltd and Alok Singh, head of products, joined in December from Wal-Mart.
“We are bringing in fresh talent as it is no longer about a manufacture capability but about in-store, retail and merchandising capabilities,” said Rajanna, adding that the company has also doubled its sales fleet in the last nine months.
To be sure, the changes have been in the making for the last 2-3 years. For the company that used to manufacture everything in-house, the first area of focus was getting its vendors and the quality control standards in place. “The work has been happening for the last 8-12 quarters. However, in the last four quarters we have moved to a completely outsourced manufacturing model,” said Rajanna.
The company has allocated more than Rs100 crore to support the revamp of the brand and communicate the changes to its consumers over the next four years. It is also figuring out the investment model for revamping its franchise stores, Rajanna said.
Some analysts are skeptical. The investment is too small, they say, while acknowledging that the strategy sounds good. “Building a national brand is an expensive proposition and requires a lot more investment,” said Arvind Singhal, managing director, Technopak Advisors Pvt. Ltd, a Delhi-based retail consultancy.
Also, the company’s past continues to haunt it. “They have spoken about it in the past and also made sporadic efforts. They are not putting in sufficient money in making the changes sustainable,” said Harminder Sahni, managing director at consulting firm Wazir Advisors.