Domestic brands pad up as Patanjali forays into apparels
Experts say Ramdev co-founded company could first target close competitors to succeed the way it did in FMCG sector
At ~500 for jeans and T-shirts, Patanjali’s foray into apparels may land up hitting domestic players more than foreign brands, top retail experts and apparel industry executives have said.
On Monday, the Ramdev cofounded company launched a swadeshi apparel store called Patanjali Paridhan in New Delhi, saying it would sell men’s, women's and children’s wear under the Livefit, Aastha and Sanskar brands, targeting a turnover of ~10 billion and a footprint of at least 200 stores in two years.
“The apparels segment is not an easy business to crack,” said Arvind Singhal, chairman, Technopak, a retail consultancy based in Gurugram. “The ones who could be hit the most (due to Patanjali's foray) are the domestic players, since they are available in the affordable range. The foreign brands ride on aspiration and are premium-priced. They may not be affected now.”
Some of the country’s top value fashion retailers include V-Mart, Max Fashion (from the Dubai-based Landmark Group), and Future Group (value format is called FBB). Max Fashion was not immediately available for comment. Lalit Agarwal, chairman and managing director at V-Mart Retail, is watching Patanjali's foray closely. "Competition is always welcome and I wish him (Ramdev) all the best for the launch of his store. Though Indian players are active in the affordable apparel space, it would be interesting to see how he expands the business and whether he drives down prices further. That could disrupt the market," Agarwal says.
Kishore Biyani, chief executive officer of Future Group, says there is room for more players within value fashion. "The market can certainly accommodate more brands and we don't see a threat to our business with the entry of a new player,” he says. “Yes, all eyes will be on what he does. But, he has only just made a start. We would need to give it some time before he expands it.”
Ramdev has announced a 25 per cent discount on all items retailing at his store during the Diwali week and says he would continue to grow his range of products. The New Delhi store stocks nearly 3,000 items across denims and casual wear, ethnic and formals as well as accessories such as chappals, shoes, bags, and jewelry.
In many respects, say retail experts, Ramdev would be taking a leaf out of the marketing manual he used in the fastmoving consumer goods, where Patanjali tasted quick success thanks to the bold bets he took. Though the pace of growth (in terms of top line) within consumer goods for Patanjali has come down in the last year — it stood at 12 per cent in 2017-18 versus 100 per cent seen in 2016-17 — companies that were initially impacted by its actions were Dabur and Emami, who operate in the ayurveda space.
Colgate and Hindustan Unilever were subsequent targets as the naturals trend began gaining ground, sector experts said.
Company says it will sell men's, women's and children's wear under the Livefit, Aastha, and Sanskar brands, targeting a turnover of ~10 billion and a footprint of at least 200 stores in two years