Business Today

Indian brands go all out to corner the foreign field

In recent years, a handful of Indian clothing, accessories and jewellery brands, including Fabindia, Hidesign and Gitanjali Gems, have been gaining traction abroad and flaunting their Indianness to successfully woo customers.

twitter-logoSarika Malhotra | July 1, 2013 | Updated 17:17 IST

A sign above one of the shops on Via del Banco di Santo Spirito in Rome will have most Indian passers by staring hard in surprise. It reads: Fabindia . The well known indigenous clothing brand has a store in Italy? Indeed so, and in Dubai and Singapore too.

"In spite of the recession in Europe, our store in Italy continues to attract crowds," says William Bissell, Managing Director, Fabindia. "It is wonderful to have a presence in one of the fashion capitals of the world." He is equally gung ho about the two other stores. "Singapore and Dubai are important markets not because of Indian diaspora there, but because they are international shopping hubs, with considerable tourist traffic."

Exports of manufactured goods from India stood at a sizeable $120,482 million for the six months of April to November 2012, but few of the India-made consumer products that go overseas are recognizable brands there.

On the contrary, many of them, especially garments, are sold by high profile, global retailers under their own brand names. No doubt, in past decades, products such as Bajaj scooters or Kirloskar pumps made a mark in specific regions, but they were the exceptions.

In recent years, however, a handful of Indian clothing, accessories and jewellery brands have been gaining traction abroad, setting up exclusive outlets and flaunting their Indianness to successfully woo customers.

Dilip Kapur, President, Hidesign. The company recently set up exclusive stores in Hanoi, Ho Chi Minh City and Johannesburg. PHOTO: Vivan Mehra

Apart from Fabindia, there is the leather accessories brand Hidesign, with nearly a dozen stores across the world, including in Moscow - where it set up its first store in 1997 - Vienna and Berlin. Jewellery major, Gitanjali Gems group, has a chain of exclusive outlets in the United States, China and Japan.

Beauty products brand Shahnaz Husain has a host of stores, including one in the heart of London and another on the Greek island of Mykonos. Even sari store Nalli Silks has set up branches in Singapore and Mountain View, California.

Though they ventured out long back, all of them have markedly aggressive in recent years.

Shahnaz Husain, for instance, opened four more exclusive retail outlets last year, all of them in spots where Indians hardly venture: Minsk in Belarus, Lima in Peru, Moscow and St Petersburg in Russia.

Fabindia's Singapore store started in January this year. Last year, Gitanjali Gems set up a store to exclusively sell diamond jewellery in Koshigaya Lake Town, Japan. Hidesign recently set up exclusive stores in Hanoi, Ho Chi Minh City and Johannesburg.

"We will be setting up a company in the US," says Dilip Kapur, Founder-CEO Hidesign . "Earlier we had a distributor there, but now we are setting up a company. Distributors don't invest in brand building." The overseas market contributes 35 per cent to Hidesign's revenue.

All of them also use their Indian origin as a marketing tool.

"Indian products pack origin-exotica. The overseas audience is excited by this," says branding consultant Harish Bijoor. Thus Fabindia emphasises that its designs, fabrics and colours are all from India, while Gitanjali Gems too stresses the uniquely Indian nature of its jewellery designs.

Gitanjali Gems Chairman Mehul Choksi
"Today, even items such as maang tikas and nose rings are being picked up by foreigners," says Mehul Choksi, Chairman and Managing Director of the Gitanjali group. "The biggest selling point is the uniqueness of our products and the obsession of customers overseas to look different and possess a rare piece."

The same formula has worked well for Shahnaz Husain's beauty products, most of which have an Ayurvedic base. "We are trying to sell a whole civilization in our jars," she says.

Hidesign's products do not have a conspicuous Indian stamp, but Kapur insists India is never too far away. "All our production is in India and all our leather is Indian," he adds. "With the likes of vegi tan leathers, we looked alternative." (Vegi tan leather is leather tanned using vegetable products, such as tannin, obtained from plants, as distinct from leather tanned with chemicals.)

Most of the global outlets are either joint ventures with a local partner - Fabindia, Hidesign - or franchisees. The Shahnaz Husain stores are a mix of both.

Gitanjali acquired Samuel Jewellers Inc, the fifth largest specialty retail chain in the United States with 111 outlets, in 2006, and has since been selling its branded products through these. Last year it also acquired a 15 per cent stake in the Japanese jewellery retail chain Verite, with a network of 101 retail stores in that country. It has taken 30 per cent stake in a 24-hour Japanese TV channel, Gems TV, as well, the better to publicise its wares.

"Having an international presence gives the company new markets, access to raw material and balances our forex since our import bill is very high," says Choksi.

Of Gitanjali Gems' revenue in 2012/13 of around $3,000 million, $250 million came from the US and another $100 million from Japan.

Last year, Fabindia too fully acquired the UK-based women's wear and jewellery retailer EAST, in which it had been investing in stages since 2009. "The acquisition gives us a chance to improve our own apparel line using their capabilities and technology," says Bissell.

But it is not enough to be Indian to compete, innovation is equally important.

Beauty expert and Shahnaz Herbals Chairperson and MD Shahnaz Hussain has a host of stores, including one in the heart of London and another on the Greek island of Mykonos. PHOTO: Vivan Mehra

Nalli Silks, for instance, has gone beyond saris. "We have introduced scarves and stoles in our collections," says Ramanathan Nalli, who looks after the company's exports. The California store also provides blouse tailoring services.

Packaging matters a great deal too.

"I personally went to Khurja to inspect the pottery designs and chose the jars in which we package our products," says Shahnaz Husain. (Khurja in Uttar Pradesh has a pottery tradition going back centuries.)

Fabindia has 'European' sizes in clothes for its shops, and also eschews such labels as 'hand wash' for any items, since the very concept of washing by hand has been forgotten in the West.

More products makers, harping on their Indian origins, are getting ready to make the leap to setting up stores overseas. One such Kama Ayurveda, which already has a kiosk at Male airport (the Maldives), and is now looking to start a standalone store in Europe. It makes Ayurvedic oils, soaps and powders, and already has distributors across several European countries, who concentrate on spas, beauty salons, hotels and pharmacies rather than department stores.

"We have an agent in The Netherlands who even conducts two day workshops on how to use our products," says Vivek Sahni, Founder and Director.

"As a market segment Indian brands will always remain niche, but they will always have buyers as well," says Pinakiranjan Mishra who leads the Retail & Consumer Products practice of Ernst & Young in India. "Westerners attach a mystique to India and will continue to do so."

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