Debdeep Sinha chief business officer for apparel at Raymond Ltd. speaks about the company’s expansion plans, Raymond’s propriety fabrics and evolving fashion landscape and more…
Debdeep Sinha is the chief business officer for apparel at Raymond Ltd. and he is a three-decade veteran in the retail industry. Sinha talks to IndiaRetailing about the evolving landscapes in India’s fashion; Raymond’s propriety fabrics; the company’s new-age stores and their expansion plans.
Edited excerpts:
Raymond is a legacy brand that is celebrating its centenary next year…
It is a cult brand…can’t get bigger than that. It’s a company in business since 1925. Our 100-year celebration will start from September this year, when the company enters its 100th year. It’s a big milestone for any company… You won’t find too many brands which last that long.
At the same time, you have a lot of other legacy brands like Park Avenue, Raymond Apparel and Color Plus.
We have four brands and all four of them are marquee brands. Raymond Ready to Wear is the ready-to-wear version of Raymond. People usually associate Raymond with fabric, but we also have a big ready-to-wear collection.
Then we have Park Avenue, which is one of the oldest formal wear brands. We like to call it a wardrobe brand because it’s also into formal as well as casual offerings.
Color Plus is a premium casual wear brand. There’s also Parx, which is a mid-premium casual wear brand. Between these four brands, we try to settle the marketplace of mid-premium to premium in both formal and casual wear.
India’s fashion consumption story has undergone a sea change over the last two decades. Zara, H&M, Uniqlo are all here now. How relevant are your brands in the changing scenario?
The industry has evolved. Today, we are seeing two phenomena being played out. One is casualization, where the boundary between formal and casual wear is blurred. It is like a hybrid. In a workplace, people are in a mix of formal/casual attire. The other is premiumization—if you see the K-curve. In India, premium products are doing well.
What we call value is struggling a bit. We are poised well in this segment where we have a big chunk of casual collection in our portfolio. Almost 50% of our portfolio is casual—Color Plus and Parx. Even Raymond Ready to Wear and Park Avenue, have a sizeable portion of casual wear. Since we are in the mid-premium and the premium segments, we can see growth in all four brands amid the dull market conditions. I feel this will continue. We are working on improving our product offering–trying to up the fashion quotient and offer what the customers need, especially the young generation of today.
If you could just give some examples of what have you done?
We have come out with a collection like Air Light, which is a feather-like collection of suit jackets, which is comfortable to wear during the day. You will not feel its load. We have also come out with a formal tech-smart product—a stainless collection. Even if you drop coffee or wine on your shirt, there will be no stain on it.
Are these your propriety products?
Yes. They are something which we have developed in-house. The fearless collection, the Techno Smart collection. We have products made of four-way stretch fabric. So, when you are working in a formal environment and you are tired and want to stretch, you can just stand up, and do your exercises. You will not even feel that you are wearing a formal shirt. In a pair of push trousers, you will feel like you are wearing track pants. Again, it’s a four-way stretch fabric. These are some collections which we are bringing in, which provide comfort to customers.
And what kind of innovations are you bringing to the stores?
For our exclusive brand outlets (EBOs), we have aggressive ramp-up plans. There are a lot of innovations that we are planning. Like, auto-checkout and digitized easel stands, LCD screens on the outside facade to communicate our in-house merchandise and VM (visual merchandizing). Currently, our average store size is about 1,400-1,500 sq. ft. And it depends on the market. In big markets, we would like to expand our stores to larger than 2,000 sq. ft.
Some companies are bringing all their brands under one roof. Do you have any such plans?
Not as of now because we want to expand the four brands individually and see these brands sell through multiple channels. We have a big MBO (multi-brand outlets) distribution network. We have our own Raymond shop (TRS) network, which is a thousand-plus stores spread across 600 towns in India. It’s a big distribution network which not too many companies can boast of.
So, what is your target for store expansions?
We are pursuing an aggressive growth strategy with plans to add about 50 to 80 stores per brand going forward every year for the next two to three years.
A lot of retailers are talking about a slowdown. How long do you think it is going to persist?
Considering the peak of 2022-23, where there was pent-up demand and revenge buying, business this year was a little bit slower. Although we did our numbers and we have grown. The quarter three and year-to-date (YTD) results have been good for us. But the market is not that great at this point.
Although the future is looking good. The year 2024 is a big election year and once that is over and there is a stable government, things will pick up. So, the macroeconomic fundamentals are looking good. The country-specific things are also playing out well. A lot of work is happening on the infrastructure front; a lot of investments are being made. So, good things are happening.
Money will trickle down. It is not like the consumers are not spending. The spending is happening—If you see, the flights are running full, people are going on vacations, hotels are full, conferences and all happening, jewellery sales are at an all-time high, and SUVs are selling at a premium. So people are spending.
So where is the slowdown?
It’s the K-Curve which is playing out. The upper end is where the spending is happening, there’s a bit of a slowdown at the value level, which will now also start picking up. And for the fashion business, today the discretionary spending is less, and more money is being spent on other categories. So that should come back. It’s only a matter of time. It is a cycle. And once that comes up, this industry also should start seeing big growth. I am bullish and optimistic that the coming year will hold out well and probably be better than what the earlier year has been.
What is your composition of sales from metro cities, tier 2, and tier 3?
We have close to about 6,000 plus points of sale. And largely our metro and TRC contribution is in the range of about 50-50. And usually, the top 20 cities for us would contribute to about 40-45% of the sales.
Will it change as you expand more into Bharat?
Our expansion plan is more for tier 1, and tier 2 markets because we are talking about a mid-premium and premium range at this point. We are holding on to our premium and mid-premium which can get into the metros, the Tier-1 markets, the state capitals and the big towns. There are hidden gem towns. We have a list of 33 towns where there is a big potential.
Is there any interesting city that surprised you?
Small cities. Like in Uttar Pradesh, there are many emerging retail hubs like Gorakhpur and Varanasi. Down south there is big potential in Andhra Pradesh and Telangana. We are a little under-penetrated in these markets–I am talking about EBOs. MBOs and our franchise network, are well covered there. I think our growth and expansion will happen more in cities like Guwahati Bhuvaneshwar. We have plans for opening up in temple towns because pilgrimage tourism is big now. We have identified a list of such strategic cities and towns where we would be opening stores.
