Raymond Ltd, India’s largest listed men’s apparel company, will more than double its retail stores to 950 by 2010 from the current 450. Most of these stores will come up in small towns, where business is growing sharply, said Raymond’s retail division president Anirudha Deshmkh.
Raymond sells its menswear fabric and five apparel brands, including Park Avenue, Parx and Manzoni, at 350 of its signature The Raymond Stores and across 85 standalone stores for each of its brands.
Apparel sales currently make up 38% of sales in India’s organized retail sector, which is growing at around 9% a year. While only 18.4% of apparel retail was in the organized sector in 2006, it is expected to grow to 35% by 2011, according to a report by Man Financial, a stock brokerage firm.
The small-town push is a big part of Raymond’s strategy to double its retail space to two million sq. ft by 2010. “There is not much strong penetration of retail in class four and five towns, particularly in states like West Bengal, Bihar and Uttar Pradesh,” Deshmukh said.
Raymond recently opened stores at Bokaro in Jharkhand, Burdwan in West Bengal, and Betia and Darbhanga in Bihar. These stores are often the first form of organized retail in these towns. But they average daily sales of around Rs40,000 to Rs50,000.
Although over 70% of Raymond’ s business comes from metros, “the market is expanding as we see a new set of consumers entering the market,” said Deshmukh.
Raymond, known for its “The Complete Man” ad campaign, will also add services and products to cater to another new and growing segment of consumers: women. Women have informally started availing of the company’s customized tailoring services and even buy its fabric as more urban women have started wearing western clothes. Raymond will now train its tailors to make women’s garments and stock fabric to suit them.
Apart from adding these services, Raymond, which opened its 350th The Raymond Store in Mumbai on Thursday, will also deal with buying or renting space at a time when real-estate prices are at historic highs, to feed their expansion plans. It has already booked space at many new malls but will also have stand-alone stores.
“Mall rentals have gone up a lot but we cannot miss out on an opportunity because of this,” Deshmukh said.