The Fashion Enabler
The Story so far…
2004 Reid & Taylor Retails Pvt. Ltd. established
To develop the EBO retail network for the brand
2006 Rechristened as Brandhouse Retails Ltd.
Global Luxury brands (dunhill & Escada) choose BHRL as their exclusive India Franchisee
Scope extended to include retailing of other SKNL brands
A strong retail team & systems puts BHRL in the radar of international brands entering India
Year Activity Rationale
2008 BHRL is demerged by mirroring the SKNL shareholding pattern.
For every 5 shares , SKNL shareholders get 1 BHRL share
• Retailing dynamics requires a special focus
• The company is looking at brands other than SKNL
• Unlocking shareholder value
2009 Brandhouse inks JV with Italy’s No. 1 fashion brand
Brandhouse Retails listed in March 2009
Offering true Italian fashion at Indian Prices for Indian youth
Post all mandatory clearances from SEBI, BSE & NSE
The Fashion Enabler
THE GROUP
SKNL
SKNL International
SKNL Divisions
Reid & Taylor (India) Ltd.
Brandhouse Retails Ltd.
GIC
SKNL UK Ltd. SKNL Italy SpA
EBOs SKNL Brands
EBOs Int. Brands
Pvt. Label Joint Venture
75 % 25 %
The Fashion Enabler
The Strategy behind Brandhouse
SKNL
• Institutional Sales• Export Sales• Large Format Stores
Trade Channels
Multibrand/ 3rd Party Retailers
The Customer
Business Opportunity for
Brandhouse
Retailers’ Margin
The Fashion Enabler
Vision & Mission
The Retail Gateway of India for Fashion & Lifestyle
Provide a distinct competitive edge to our brands by creating
an International Retail Experience for addressing the booming
Indian Consumerism
The Fashion Enabler
Sell @
MRP
Produce &
Sell @WSP MRP –WSP = Margin
Brand A
Brand B
Brand N
Consumer
The Business Model
The Fashion Enabler
The Customer-Centric Best Model
The Desired Store
Perception
Easiest (Accessible & Approachable)
Friendliest (Courtesy &
Service)
Honest (Price guarantee &
Trust)
Latest (Contemporary & Socially correct)
Widest (Range & Choice of
offering)
The Fashion Enabler
BHRL’s Key Strengths
1 Human Resource
2 Systems Driven Approach
3 Integration with SKNL
4 Strong Brand Mix
The Fashion Enabler
1 Human Resource
A strong, experienced team of retail professionals create the cutting edge in a very competitive scenario
The Fashion Enabler
Retail Operations
Business Development
CEO
COOBusiness Development
COOOperations
Scouting New Stores
Commercial feasibility
Legal Clearances
Architect Coordination
Setting up stores
Hiring Staff
Managing Stores
Analyzing Performance
Buying & Merchandising
Staff Training/Incentive
Visual Merchandizing
Advertising/Promotions
The Functional Division
The Fashion Enabler
Managers, Executives & Support Staff
The Organogram
MD & CEO
COOBusiness Development
COOOperations
CFO
VP Acquisition(Real Estate)
VP Projects (Store
Implementation)
VP 1 GM
Accounts
Company Secretary & Legal
GM IT
GM Commercial
Regional managers and executives in the 4 regions of India
VP Buying &
MerchandisingGM
Luxury
VP 2GM HR
The Fashion Enabler
Thumbnails of our Key People
Tarun Joshi M.D. & CEO
45 years old with over 23 years of experience in marketing, communications & Retail. Has worked with leading multinationals
Surjit Singh COO Development
43 years old with over 20 years of experience in marketing & Retail. Has worked with Crossroads, ZEE TV & Akbarallys
Ashok Dalal COO Oviesse
42 years old with over 18 years of experience in Advertising & Retail. Has worked with Tata Exports, Westside & Pyramid Retails
Indraneell Basu V.P. Operations
35 years old with over 12 years of experience in Retail. Has worked with Benetton, Wills Lifestyle & Titan
Amit Chopra V.P. Operations
34years old with over 14 years of experience in Retail. Has worked with Wills Lifestyle, Pizza Corner, Nirulas.
Sameer Sikka V.P. Real Estate
34 years old with over 10 years of experience in Retail. Has worked with Raymond’s, Shopper’s Stop & Weekender
Paritosh Jain COO Operations
45 years old, with over 20 years of experience in Retail. He has worked with Bata, Raymonds & Wills Lifestyle
The Fashion Enabler
2 Systems Driven Approach
Objective, systematic approach that maximizes productivity & efficiencies
The Fashion Enabler
Integrated, Systems-Driven Retail footprint
Shoppers IT Software
SAP
Buying & Merchandising
Marketing
Store OperationsFinance
Human Resource
Development
Information Technology
Logistics & Supply Chain
Business Development
The Fashion Enabler
The Holistic Approach to Retailing
Consumer ComprehensionDemographics• Geographic Spread
• Affluence Levels
• Wallet Monitor
Psychographics• Usage & Attitudes
• Needs & Wants
• Aspirations & Desires
BrandComprehensionThe Tangibles• Product attributes
• Range & Seasonality
• Pricing strategy
The Intangibles• Brand Positioning
• Brand Identity
• Brand Values
RetailComprehensionExternal Environment• Location Aspects
• Commercial Viability
• Long-term Outlook
Internal Environment• Visual Merchandising
• Inventory Management
• Service & CRM
The Fashion Enabler
Operational Strengths – Highlights
Area Challenges BHRL’s Strengths Real
EstateLimited supplyVery high Rentals
Dedicated team of professionals with constant mapping of Indian market. Early information & action enable early entry into new projects at better costsCollective bargaining (all brands) for better rentals
Projects Quality, Time & Cost management pan India
In-house team of architects & related specialists Regional tie-ups with contractorsCollective bargaining with vendors
Operations Skilled ManpowerQuality Standards Inventory Management
Regular training & career development opportunities programs to attract & retain quality manpower
Innovative incentive packages for added motivationS.O.P. manual implemented through national / regional teams.SAP (I.S. Retails) under implementation for better systems with special focus on Merchandise Planning.
Knowledge Bank
Competitor performanceIndustry InformationConsumer track
Data collection by regional teams (monthly)Subscription to various industry reportsRegular research & surveys
The Fashion Enabler
3 Integration with SKNL Group
The advantages of being a part of a large group with over six decades of experience in textiles & fashion
The Fashion Enabler
The Overall Picture
BRANDHOUSER E T A I L S
SKNL Group
International Brands
CaptiveBusiness
RetailSupport
RetailExpertise
BusinessAvenues
Outsourcing / Manufacturing
The Fashion Enabler
The Other Advantages
Marketing
Logistics & Supply Chain
Buying & Merchandising
SKNL Group
Sourcing & Manufacturing
The Fashion Enabler
4 Strong Brand Mix
The advantages of having a strong portfolio of brands with strong equity & a well- established track record
The Fashion Enabler
Solid Brands with Strong Brand Equities
Brand Profile
Reid & Taylor A 165 year old heritage brand from Langholm, Scotland, Reid & Taylor was launched in India in 1999. Today it is a premium suiting and apparel brand with a very high brand equity. As on Mar 08, it has 158 EBOs across the country.
Belmonte A unique combination of Fabric & Apparel in the mid-price segment, Belmonte has grown into a well-recognized brand in two years, since launch. As on Mar 2008, Belmonte has 103 EBOs across the country
Carmichael House A mid-premium home textiles brand Carmichael House has become the No. 2 brand in the country in less than two years. As on Mar 08, it has 113 EBOs across the country
Stephens Brothers A Super-Premium Brand SB is a JV between SKNL and Austin Reed, UK. It offers formal wear for men & women. As on Mar 08 it has 19 EBOs in India
dunhill A leading Luxury brand for men, dunhill has 3 boutiques in India. In a nascent Luxury market in India dunhill is already a leading name for men’s apparel & accessories within one year of launch
The Fashion Enabler
Financial Overview
2007-08Audited
2008-09Audited
2009-10Projected
No. of Stores 398 683 909
Area (Sq.ft.) 4,18,415 666,575 911,100
Revenues (Rs. Cr.) 313.79 552.35 812.72
EBIDTA (Rs. Cr.) 31.22 41.18 78.84
EBIDTA % 9.95% 7.45% 9.7%
PBT (Rs. Cr.) 22.63 24.12 33.40
PBT % 7.2% 4.4% 4.1%
PAT (Rs. Cr.) 13.31 13.39 22.15
PAT % 4.2% 2.4% 2.70%
The Fashion Enabler
Rental matrix – Own StoresRent/PSF month Metro Tier 1 Tier 2
Reid & Taylor 225 175 125
Carmichael House 175 125 80
Stephens Brothers 300 200 -
Belmonte 160 125 90
Luxury 800 - -
The Fashion Enabler
Growth Plan in terms of Sales/Sq ft/ Day (PSFPD)
Sales/PSFPD 2008-09
Reid & Taylor 27.06
Carmichael House 16.41
Stephens Brothers 31.88
Belmonte 19.15
Luxury 53.33
TOTAL 22.69• All PSFPD figures in INR• All PSFPD is calculated on carpet area
The Fashion Enabler
Indian Economy & Retail
GDP USD 804 Bn
Private Consumption USD 482 Bn ( 60%)
Public spending & Gross Capital formation USD 322 Bn ( 40%)
Non - Retail USD 182 Bn ( 38%)
Retail USD 300 Bn ( 62%)
Source : Central statistical Organization & Technopak Analysis
Retail is a key driver in the Indian economy (37% 0f GDP)
The Fashion Enabler
Growth of Organized Retail in India
2002 2007 2011 (Projected)
Total Retail
Organized (1.8%)
Total Retail
Organized (4.6%)
Total Retail
Organized (11%)
USD Bn 194 3.5 300 14 527 58
INR Cr 8,25,000 14,850 12,78,100 59,000 22,39,800 2,46,378
Source : Cygnus Research, Images & Technopak Analysis
Growth of Organized retailing is a huge business opportunity
The Fashion Enabler
Share of Categories in Organized Retailing
Source : KSA Technopak
Clothing, Textile & Fashion Accessories take a clear lead in Organized retailing
The Fashion Enabler
Category-wise split of Clothing & Textile Industry
Source : Images F&R Study
Menswear is clearly the leader by value
The Fashion Enabler
…. And Menswear will continue to dominate
Consumption trends in 2015
Source : McKinsey Analysis
The Fashion Enabler
Category pie in Menswear
Source : The Knowledge Company
Formal Wear & Fabric constitute about half the pie.Casual Wear is catching up fast
The Fashion Enabler
Structure of the Indian Menswear Market
Source : Images F&R Study
Louis Vuitton, Chanel, Gucci, Zegna, dunhill, Escada
Nautica, Lacoste, Manzoni, Gant, Espirit, Tommy, Stephens Brothers
Louis Philippe, Wills Lifestyle, Van Heusen, Raymonds, Zodiac, Reid & Taylor
Peter England, Koutons, Excalibre, Belmonte
Unbranded
1,500 Cr. (YOY 36%)
Regional Brands
Total Menswear Market is INR 43,300 Cr. � YOY Growth % reflects Value growth � Figures in brackets are price per shirt in INR
?
Lower Mass Market
(Upto 250)
Luxury(5000+)
Super Premium(3000-5000)
Premium(1200-3000)
Mid Price(600-1200)
Economy(250-600)
Lower Mass Market (Upto 500)
6800 Cr. (YOY 24%)
8800 Cr.. (YOY 17 %)
8100 Cr.. (YOY 11 %)
18100 Cr. (YOY 7 %)Lower Mass Market
(Upto 250)
The Fashion Enabler
The Global Luxury Fashion brands Market (USD 80 Bn.)
Asia37%
Europe35%
Others4%
US24%
Source : The Cult of The Luxury Brand
The Fashion Enabler
The Asian Contribution ( USD 29.6 Bn.)
Source : The Cult of The Luxury Brand
Indian Market = USD 296 Mn. Or INR1258 Cr.
The Fashion Enabler
Evolution of the Luxury Market (Asia) SUBJUGATION
• Authoritarian rule
• Poverty & Deprivation
START OF MONEY• Economic
growth
• Masses buy white goods
• Elite start buying Luxe
SHOW OFF
• Acquire symbols of wealth
• Display economic status
FIT IN
• Larger scale adoption of Luxe
• Fuelled by need to conform
WAY OF LIFE
• Locked into Luxe habit
• Confident, discerning buyers
SOURCE : The Cult of Luxury Brand, Industry estimates
IndiaChina
HK/S’poreJapan
0 – 5 Years 6 – 10 years 11– 20 yearsIndian growth Estimates
In the next 5 years, Indian market is projected to grow around 10 times its current size
The Fashion Enabler
1. Additions to our EBO Portfolio
SKNL BRANDSNew Brands Being Launched in Garments by SKNL
Premium FormalwearPremium Casualwear
NON-SKNL BRANDSNew Brands seeking BHRL as a Pan-India Retail Partner
Leading MNC based in India (for a Youth Brand)International Luxury Brands
The Fashion Enabler
Age Bracket % Population
0 ‐17 years 40.1 %
18‐35 years 30.2 %
36‐49 years 17.1 %
50 years + 12.6 %
Analyzing The Indian Population
• Fashion Conscious• Propensity to spend• Decision makers • Key Influencers
The Fashion Enabler
Developing the Business Proposition
Fast Fashion (Global)
Affordable Price
Attractive Locations
Family Store
Total Wardrobe Solution
Core Target (18 – 35 yrs)
• College student
• Working singles
• Working married no kids
• Working married very young kids
The PropositionLarge stores of 8-10,000 Sq.ft.
The Fashion Enabler
Aspirational Position in Value Priced Fashion Apparel
Luxury
Super -Premium
Premium
Mid-Price
Economy
Unbranded
Affordable Price
Fashion ProductsQuality
Family Store…Core Target Segment 18 – 35
years
At Indian PricesItalian Fast Fashion
The Fashion Enabler
Our Partner Oviesse –The Leader in Italian Fast Fashion
Part of Gruppo Coin, Italy’s leading fashion retailer with sales of over 1.1 billion EurosOviesse, the benchmark in Italian Fast Fashion
Over 11 million customers in Italy every yearOver 100 million garments sold every yearSales of over 820 million Euros
A favorite with Italian shoppers9% of the share of the wallet of Italian Consumers1in every 5 Italians shop at Oviesse every year1 in every 3 Italian Kids wear Oviesse apparel
Spreading beyond ItalyOver 340 stores in Italy & abroad
The Fashion Enabler
The Business Structure
BRANDHOUSE RETAILS LIMITED
Master Franchise
SKNL Brands
Other Premium / Super-Premium Brands
Joint Venture Subsidiary
Luxury Brands
Oviesse Joint Venture
The Fashion Enabler
JOINT VENTURE•Trend Forecasting• Design & Development• Manufacturing/ Sourcing• Distribution & Logistics• Brand Building• Retail Stores
Margin = MRP - Cost
Consumer
The Business Model
Sell @
MRP
62.5 %
37.5 %
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