The Puducherry-based Hidesign, best known for its leather bags andaccessories, plans to enter the footwear segment as part of its effort to become a full-fledged fashion brand even as rising incomes increase demand for such products in one of the world’s fastest growing large economies.
In an effort to diversify operations and leverage the fashion-brand status, the company, which operates two boutique luxury hotels in Puducherry, is also looking to build beach villas.
“Footwear is a natural extension for any accessories maker. We are at present looking at the financial feasibility of the idea. We will eventually grow out of a bags brand into a fashion brand,” said Dilip Kapur, Hidesign’s founder and president. Simultaneously, Hidesign also plans to upgrade its offerings, placing more emphasis on its quality and finish. The company will provide hand-stitched, handcrafted, leather products of premier quality in the next two to three years, added Kapur. He said there could be some changes in the company’s design process as it seeks to do this.
According to Kapur, the company is using the expertise of LVMH, which has a 20% stake in Hidesign, to chart its journey towards becoming a fashion brand. Hidesign’s employees are being trained at the offices of the French luxury brand, one of the best known in the world.
Hidesign plans to open nine more stores in India by March, taking its total number of stores in the country to 48; it also has 15 stores in the US, South Africa, Russia and China. Kapur said the company plans to add 10-15 stores in overseas locations every year. The expansion will be funded from internal resources and the money invested by LVMH, said Kapur. The two companies have not disclosed the terms of the deal.
As Hidesign becomes a fashion brand, its products will become more expensive, according to Kapur who sees an average 15% rise in prices in the next year. Much like LVMH which destroys unsold products rather than put them on sale, Hidesign plans to give away unsold goods to charity.
On its hospitality front,Hidesign is developing its third boutique hotel in south India. The property, which will be ready in 15-18 months, will be managed by Tata group’s Indian Hotels Co.
“We are (also) looking at something on the lines of beach villas, like the ones in Bali (Indonesia). The search is on for right kind of properties. We want to infuse a certain aesthetic, design and ethic sense in our hotels, the same qualities that Hidesign brand stands for,” Kapur said. The privately held company ended 2006-07 with Rs100 crore in revenues and expects to grow by 15-20% in 2007-08.