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Fossil wakes up to India story

Known in the country mainly for its watches, the consumer fashion accessories player has decided to target the bridge-to-luxury segment for growth

Antonita Madonna  |  Bangalore 

Having acquired a single brand retail licence in the country, Fossil is sharpening its focus on India as one of the top growing markets in the Asia-Pacific region. Known in India mainly for its namesake watches, Fossil is now gearing up to showcase its strength as a leading consumer player in the world.

And the space it has chosen is the which, it feels, is relatively less populated. So Fossil plans to launch its own line of accessories in leather goods, jewellery and eyewear in addition to its whole range of watches. "In India, the competition is less in this look, quality and price point. For instance, there is a gap between the fashion handbags available in stores (in the range of Rs 2,000-5,000) and the luxury handbags in Louis Vuitton," says Vasant Nangia, managing director, "No one is filling that gap here. In the US, there are brands like Coach, and others bridging that gap but these brands haven't entered India yet."



Fossil has decided to cash in on this vacuum for product with aspiration value, at relatively affordable price points in the country and says it has the flexibility to customise its global portfolio to Indian preferences. "We have the advantage of a very large portfolio, with different brands doing well in different regions.

The demographics is in our favour in India, so we have a lot of plans for the country," Nangia says.

Apart from the Fossil brand, the company has also licensed brands like Skaagen, Zodiac, Burburry, Michael Kors, Tony Birch and very recently, Karl Lagerfeld. Fossil has just launched some of these brands in India and is working on the launch of Michael Kors soon.

Ankur Bisen of Technopak says, "The strategy has scope to pan out very well in India as the BTL segment offers great value to consumers seeking aspirational products. There is a sizeable chunk of customers aspiring for luxury products but not able to get there because of the price points,"

As Bisen points out, categories like accessories (bags, belts and wallets) have very few players in the BTL segment, while a category like watches has the most number of players in this segment in India. However, it still remains one of the fastest growing purchase segments in the country, registering double-digit growth.

"In the lifestyle space, the apparel segment is growing the fastest at 20-25 per cent, followed closely by footwear. The watches and accessories market is also growing at about 20 per cent," says Bisen.

However, Fossil is in its testing phase and Nangia is not in a hurry. "First we'll test out formats and product categories. We'll be introducing bags for women and men, jewellery, eyewear and of course our whole range of watches. The idea is to have the same collection available in New York and Tokyo here at the same time."

Titan, India's most popular name in the watches category, estimates the market at about Rs 5,000 crore and claims a 50 per cent market share in it.

Own line of stores
Nangia says the company's only roadblock to expansion is the lack of a proper distribution chain in the country for products in the premium lifestyle or bridge-to-luxury segments. Hence, Fossil has now decided to set up its own line of stores - availing the benefit of the single-brand retail licence in the country.

"High-end retail has not developed in India and our biggest constraint in growth is appropriate distribution," Nangia says.

Fossil plans to open two to three trial stores in the first quarter of 2014, initially targeting larger metros. Once the exclusive-brand outlet format is tested and found successful, Fossil also has an eye on the mini-metros as it sees "a lot of scope in them."

"This may limit sales but give them good control over their brand and give them the flexibility to see which area they want to grow in and the terms they want to grow on," Technopak's Bisen says.

As a result, the vast majority of the company's portfolio will still comprise watches (about 80-85 per cent) as they are sold in all multi-brand outlets as well. The other categories it plans to introduce will be strictly restricted to its own stores.

India as sourcing hub
Apart from being a large destination for product sale, Fossil wants to grow its India exports business as well. The company has a manufacturing unit in Palwan in Himachal Pradesh where it manufactures watches for its Fossil and DKNY brands, depending on the feasibility and technicality.

"We are looking at expanding our production heavily to increase exports", Nangia says. While the facility now mostly manufactures watches, Fossil plans to ramp up the capacity of its manufacturing unit to meet the 30 per cent sourcing norm mandated by the government in return for the licence to operate a foreign brand in the country.

The company says it is investing in developing its vendor base to meet the global standards and believes that is a long-term effort. "Fortunately, India is one of the few countries in the world that has a watch-making history," Nangia says.

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Fossil wakes up to India story

Known in the country mainly for its watches, the consumer fashion accessories player has decided to target the bridge-to-luxury segment for growth

Known in the country mainly for its watches, the consumer fashion accessories player has decided to target the bridge-to-luxury segment for growth Having acquired a single brand retail licence in the country, Fossil is sharpening its focus on India as one of the top growing markets in the Asia-Pacific region. Known in India mainly for its namesake watches, Fossil is now gearing up to showcase its strength as a leading consumer player in the world.

And the space it has chosen is the which, it feels, is relatively less populated. So Fossil plans to launch its own line of accessories in leather goods, jewellery and eyewear in addition to its whole range of watches. "In India, the competition is less in this look, quality and price point. For instance, there is a gap between the fashion handbags available in stores (in the range of Rs 2,000-5,000) and the luxury handbags in Louis Vuitton," says Vasant Nangia, managing director, "No one is filling that gap here. In the US, there are brands like Coach, and others bridging that gap but these brands haven't entered India yet."

Fossil has decided to cash in on this vacuum for product with aspiration value, at relatively affordable price points in the country and says it has the flexibility to customise its global portfolio to Indian preferences. "We have the advantage of a very large portfolio, with different brands doing well in different regions.

The demographics is in our favour in India, so we have a lot of plans for the country," Nangia says.

Apart from the Fossil brand, the company has also licensed brands like Skaagen, Zodiac, Burburry, Michael Kors, Tony Birch and very recently, Karl Lagerfeld. Fossil has just launched some of these brands in India and is working on the launch of Michael Kors soon.

Ankur Bisen of Technopak says, "The strategy has scope to pan out very well in India as the BTL segment offers great value to consumers seeking aspirational products. There is a sizeable chunk of customers aspiring for luxury products but not able to get there because of the price points,"

As Bisen points out, categories like accessories (bags, belts and wallets) have very few players in the BTL segment, while a category like watches has the most number of players in this segment in India. However, it still remains one of the fastest growing purchase segments in the country, registering double-digit growth.

"In the lifestyle space, the apparel segment is growing the fastest at 20-25 per cent, followed closely by footwear. The watches and accessories market is also growing at about 20 per cent," says Bisen.

However, Fossil is in its testing phase and Nangia is not in a hurry. "First we'll test out formats and product categories. We'll be introducing bags for women and men, jewellery, eyewear and of course our whole range of watches. The idea is to have the same collection available in New York and Tokyo here at the same time."

Titan, India's most popular name in the watches category, estimates the market at about Rs 5,000 crore and claims a 50 per cent market share in it.

Own line of stores
Nangia says the company's only roadblock to expansion is the lack of a proper distribution chain in the country for products in the premium lifestyle or bridge-to-luxury segments. Hence, Fossil has now decided to set up its own line of stores - availing the benefit of the single-brand retail licence in the country.

"High-end retail has not developed in India and our biggest constraint in growth is appropriate distribution," Nangia says.

Fossil plans to open two to three trial stores in the first quarter of 2014, initially targeting larger metros. Once the exclusive-brand outlet format is tested and found successful, Fossil also has an eye on the mini-metros as it sees "a lot of scope in them."

"This may limit sales but give them good control over their brand and give them the flexibility to see which area they want to grow in and the terms they want to grow on," Technopak's Bisen says.

As a result, the vast majority of the company's portfolio will still comprise watches (about 80-85 per cent) as they are sold in all multi-brand outlets as well. The other categories it plans to introduce will be strictly restricted to its own stores.

India as sourcing hub
Apart from being a large destination for product sale, Fossil wants to grow its India exports business as well. The company has a manufacturing unit in Palwan in Himachal Pradesh where it manufactures watches for its Fossil and DKNY brands, depending on the feasibility and technicality.

"We are looking at expanding our production heavily to increase exports", Nangia says. While the facility now mostly manufactures watches, Fossil plans to ramp up the capacity of its manufacturing unit to meet the 30 per cent sourcing norm mandated by the government in return for the licence to operate a foreign brand in the country.

The company says it is investing in developing its vendor base to meet the global standards and believes that is a long-term effort. "Fortunately, India is one of the few countries in the world that has a watch-making history," Nangia says.
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Business Standard
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Fossil wakes up to India story

Known in the country mainly for its watches, the consumer fashion accessories player has decided to target the bridge-to-luxury segment for growth

Having acquired a single brand retail licence in the country, Fossil is sharpening its focus on India as one of the top growing markets in the Asia-Pacific region. Known in India mainly for its namesake watches, Fossil is now gearing up to showcase its strength as a leading consumer player in the world.

And the space it has chosen is the which, it feels, is relatively less populated. So Fossil plans to launch its own line of accessories in leather goods, jewellery and eyewear in addition to its whole range of watches. "In India, the competition is less in this look, quality and price point. For instance, there is a gap between the fashion handbags available in stores (in the range of Rs 2,000-5,000) and the luxury handbags in Louis Vuitton," says Vasant Nangia, managing director, "No one is filling that gap here. In the US, there are brands like Coach, and others bridging that gap but these brands haven't entered India yet."

Fossil has decided to cash in on this vacuum for product with aspiration value, at relatively affordable price points in the country and says it has the flexibility to customise its global portfolio to Indian preferences. "We have the advantage of a very large portfolio, with different brands doing well in different regions.

The demographics is in our favour in India, so we have a lot of plans for the country," Nangia says.

Apart from the Fossil brand, the company has also licensed brands like Skaagen, Zodiac, Burburry, Michael Kors, Tony Birch and very recently, Karl Lagerfeld. Fossil has just launched some of these brands in India and is working on the launch of Michael Kors soon.

Ankur Bisen of Technopak says, "The strategy has scope to pan out very well in India as the BTL segment offers great value to consumers seeking aspirational products. There is a sizeable chunk of customers aspiring for luxury products but not able to get there because of the price points,"

As Bisen points out, categories like accessories (bags, belts and wallets) have very few players in the BTL segment, while a category like watches has the most number of players in this segment in India. However, it still remains one of the fastest growing purchase segments in the country, registering double-digit growth.

"In the lifestyle space, the apparel segment is growing the fastest at 20-25 per cent, followed closely by footwear. The watches and accessories market is also growing at about 20 per cent," says Bisen.

However, Fossil is in its testing phase and Nangia is not in a hurry. "First we'll test out formats and product categories. We'll be introducing bags for women and men, jewellery, eyewear and of course our whole range of watches. The idea is to have the same collection available in New York and Tokyo here at the same time."

Titan, India's most popular name in the watches category, estimates the market at about Rs 5,000 crore and claims a 50 per cent market share in it.

Own line of stores
Nangia says the company's only roadblock to expansion is the lack of a proper distribution chain in the country for products in the premium lifestyle or bridge-to-luxury segments. Hence, Fossil has now decided to set up its own line of stores - availing the benefit of the single-brand retail licence in the country.

"High-end retail has not developed in India and our biggest constraint in growth is appropriate distribution," Nangia says.

Fossil plans to open two to three trial stores in the first quarter of 2014, initially targeting larger metros. Once the exclusive-brand outlet format is tested and found successful, Fossil also has an eye on the mini-metros as it sees "a lot of scope in them."

"This may limit sales but give them good control over their brand and give them the flexibility to see which area they want to grow in and the terms they want to grow on," Technopak's Bisen says.

As a result, the vast majority of the company's portfolio will still comprise watches (about 80-85 per cent) as they are sold in all multi-brand outlets as well. The other categories it plans to introduce will be strictly restricted to its own stores.

India as sourcing hub
Apart from being a large destination for product sale, Fossil wants to grow its India exports business as well. The company has a manufacturing unit in Palwan in Himachal Pradesh where it manufactures watches for its Fossil and DKNY brands, depending on the feasibility and technicality.

"We are looking at expanding our production heavily to increase exports", Nangia says. While the facility now mostly manufactures watches, Fossil plans to ramp up the capacity of its manufacturing unit to meet the 30 per cent sourcing norm mandated by the government in return for the licence to operate a foreign brand in the country.

The company says it is investing in developing its vendor base to meet the global standards and believes that is a long-term effort. "Fortunately, India is one of the few countries in the world that has a watch-making history," Nangia says.

image
Business Standard
177 22