The US-based home and office furnishing major Knoll has entered into a dealership and brand-licensing agreement with Godrej Interio, a unit of the Jamshyd-Godrej-promoted Godrej & Boyce, to manufacture and market its home and office furniture. The move comes when international furniture majors such as IKEA are eyeing a presence in India.
IKEA has sought approval to invest Rs 10,500 crore to set up single-brand retail outlets in India. The government has given indications that the Swedish major, the largest furniture retailer in the world, is likely to get the go-ahead to set up shop.
If IKEA does indeed get the nod, it is likely to give a boost to the domestic furniture market, which, according to industry estimates, is pegged at Rs 40,000 crore. This includes both the organised and unorganised segments. Organised, pegged at Rs 5,000 crore, forms 12-13 per cent of the overall market. Its growth seems to be drawing the attention of global players.
Anil Mathur, chief operating officer, Godrej Interio, says the organised furniture market is growing at double the rate of the overall market at 20 per cent. Players such as Godrej Interio are bracing up for the onslaught from big brands.
Mathur says the company will add some 15 stores in the current fiscal, taking its overall tally to nearly 150.
By next year, the company whose turnover is Rs 1,400 crore, is looking to take its store count to 200, Mathur said.
Godrej is also looking at more dealership and brand licensing tie-ups with international brands to beef up its portfolio. Besides Knoll, the company has a similar arrangement in the healthcare furnishing space with the Netherlands-based Linet Group, which is the third-largest maker of hospital and nursing-home furniture in the world.
Besides Godrej, companies such as Wipro Consumer Care, which has a furniture business besides lighting and FMCG, is also looking to beef up its portfolio in view of the growing competition. The company is counting on tie-ups with international designers to push its office furniture aggressively into the institutional segment in the country. Wipro executives say that the business holds enormous potential with multinationals stepping into the country and local players wanting to refurbish their office spaces to give it an international look and feel.
Retailers such as Home Town from the Future Group, Home Centre promoted by the Dubai-based Landmark Group and Homestop from Shopper's Stop are some of the other players in the space. Then there are companies such as tile and bath fittings major H R Johnson, which are peripherally present in the furnishing space with its modular kitchens business - a segment that is beginning to take off in the home furnishing market. Besides H R Johnson, Godrej Interio, Veneta Cucini and Kutchina from the Kolkate-based Bajoria Group also operate in the segment.