Glo­ria Jeans, Rus­sia mov­ing to­wards high growth with in­creased sourc­ing from In­dia

Apparel Online - - Emerging Market -

Glo­ria Jeans Cor­po­ra­tion, Moscow a ver­ti­cally in­te­grated re­tailer and a fast-fash­ion leader in the Rus­sian ap­parel in­dus­try, is spread­ing its wings. In 2017, the num­ber of com­pany-owned stores was 568, spread across Rus­sia, Ukraine, Belorus­sia, Ge­or­gia and Kaza­khstan. As per a mar­ket re­port by McKin­sey Con­sult­ing, each store open­ing strength­ens Glo­ria Jeans brand pres­ence, which is al­ready a favourite in Rus­sia and rec­og­nized by a whop­ping 95% of Rus­sian cit­i­zens. Com­pared to 2016, Glo­ria Jeans’ sales grew 20.1 per cent in 2017, to­talling 40.8 bil­lion rou­bles. The sales growth was driven by higher comp store sales by 10.5 per cent as well as higher sell­ing space by 18 per cent. The com­pany plans to open a new store al­most every fort­night and plans to ex­pand its pres­ence not only in Rus­sia and Be­larus, but also en­ter new mar­kets in Eastern Europe.

With ex­pand­ing re­tail base, the com­pany started its sourc­ing and li­ai­son of­fice in In­dia al­most twoand-a-half years ago and has since then no­ticed dou­ble digit growth in sourc­ing from In­dia. The way the mar­ket is grow­ing, the of­fice is ex­pect­ing same growth graph in the com­ing years, as new ven­dors are in the process to get as­so­ci­ated with the li­ai­son of­fice, af­ter some ini­tial reser­va­tions. Head­ing the In­dia of­fice as Coun­try Man­ager is Ash­wani Mar­wah, an ex-Nif­tian hav­ing an ex­pe­ri­ence of 26 years in the ap­parel in­dus­try and that too mostly on the sourc­ing side, hav­ing worked with re­tail­ers/brands like OTTO, VF Cor­po­ra­tion, Ern­st­ing’s Fam­ily, Lidl to name a few.

Ash­wani is very up­beat on the prospects of busi­ness in Rus­sia.

There is growth in the Rus­sian mar­ket and many fac­tors that will in­flu­ence growth in re­tail, like pres­ence of good qual­ity mer­chan­dise at rea­son­able prices, which is a sure-fire for­mula for growth in any re­tail mar­ket. Brands like Glo­ria Jeans are bring­ing value for money on the ta­ble for the con­sumer and is also of­fer­ing fast fash­ion with new­ness al­most every 30-60 days in the stores – these com­pli­ments the value for money be­ing of­fered. “Cur­rently our sourc­ing from In­dia is around 10-12 per cent of over­all sourc­ing as we have of­fices in Shang­hai, Viet­nam, Hong-Kong, Bangladesh and Uzbek­istan. We are ex­pect­ing that in com­ing years sourc­ing from In­dia will be 20 to 25 per cent of the to­tal sourc­ing. Our main prod­ucts from In­dia are kids and ladieswear (value-added) mainly from in and around Delhi-NCR, where we have around 10 ven­dors for the same. Knits is not big in our sourc­ing bas­ket at the mo­ment though we are work­ing with 4 sup­pli­ers in Tirupur, as ex­porters even in Tirupur are still not able to match our price points,” shares Ash­wani. Though the prices are very sharp for Rus­sian mar­ket, but Glo­ria Jeans plays on num­bers as its av­er­age min­i­mum or­der per style per colour­ways is 6,000 to 8,000 pieces.

Ba­sic qual­i­ties in an ex­porter when con­sid­er­ing him for Rus­sia mar­ket, in­cludes be­ing ba­sic so­cially com­pli­ant, price-ag­gres­sive and should have a track record of de­liv­er­ing on time. “Our com­pli­ance team does the ini­tial au­dit prior to on board­ing a new sup­plier. We are sen­si­tive to com­pli­ance is­sues,” said Ash­wani. To an ex­porter in­ter­ested to work with Rus­sia, Ash­wani ad­vices that it is a good and easy mar­ket pro­vided we live up to our com­mit­ments with re­gard to qual­ity, de­liv­ery and price; in re­al­ity this is no dif­fer­ent from what other mar­kets ex­pect.

Talking about the warm re­sponse of In­dian ex­porters that are work­ing with Glo­ria Jeans, Ash­wani fur­ther shared that ini­tially there were lit­tle ap­pre­hen­sion with few ex­porters about work­ing in Rus­sia, due to the past rep­u­ta­tion of the coun­try, but now they are quite en­thu­si­as­tic. “They are re­ceiv­ing more or­ders from us. Ini­tially they worked on LC but now they hap­pily work on TT and don’t seek ad­vance also.” He fur­ther added that it is a myth that the Rus­sian mar­ket is very dif­fi­cult to work in, be it be­cause of pay­ment or lan­guage is­sues. “Most of the top brands or re­tail­ers are hav­ing their of­fices in Rus­sia and many English-speak­ing pro­fes­sion­als are work­ing there. Re­gard­ing pay­ment, one has to be very clear about terms and con­di­tions. Pay­ment risk in Rus­sia (mainly with im­porters or whole­salers etc.) are as in any other coun­try across the globe. I don’t see there is any is­sue to work with Rus­sian mar­kets, one has to change its per­cep­tions. Nowa­days there is noth­ing that is a ma­jor de­ter­rent in work­ing with the coun­try, the ex­porters need to be more open and flex­i­ble,” con­cludes Ash­wani.

Ash­wani Mar­wah, Coun­try Man­ager – In­dia, CJSC Glo­ria Jeans Cor­po­ra­tion

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