Iconic US brand GAP comes to India through Arvind franchise

Arvind is looking to open 40 stores in the next five years and looking at a business opportunity of Rs 1,000 crore from the venture

US apparel retailer GAP has entered India through a franchise agreement with Arvind Lifestyle Brands, a unit of textile and retail major Arvind. About 40 stores will be opened in the next five years and Arvind expects Rs 1,000 crore worth of business opportunity from the venture.

“For many years, we supplied clothing to GAP. Now we are partnering them for retail operations,” said Sanjay Lalbhai, chairman and managing director, Arvind.

GAP, a mass premium brand, will fit in between licensed premium brands of Arvind such as Calvin Klein, Nautica and Tommy Hilfiger, and mid-level brands such as Arrow and US Polo, said J Suresh, managing director of Arvind Lifestyle Brands.

“GAP will strengthen our menswear and kidswear portfolios. There is a huge opportunity to go beyond tier-I cities,” Suresh added.

Arvind’s stock increased 1.25 per cent on Friday to close at Rs 255.90 on the BSE.

Gap has 3,500 stores in 50 countries; 300 are franchise-owned stores and competes with Zara, H&M, Uniqlo and others globally.

While Zara is present in India through a joint venture with Trent, H&M is planning to open stores by the year-end. Uniqlo is also keenly looking at the Indian market with its chairman Tadashi Yanai meeting Prime Minister Narendra Modi recently.

“Any brands company would love to get a partnership with Gap. Arvind is getting a big thing. Now others have to get Uniqlo to compete with them,” said Harminder Sahni, managing director of Wazir Advisors. After announcing a foray into e-commerce early this week, Arvind announced a franchisee agreement with US-based kidswear retailer The Children’s Place on Thursday. In March this year, Arvind entered into a joint venture with US-based brand Calvin Klein. Arvind also has a joint venture with Tommy Hilfiger. Besides, the Indian textile company has agreements with Gant, Nautica, Arrow, US Polo, Ed Hardy, and Hanes, among others.

FASHION FORWARD

• About 40 GAP stores will be opened in five years
• Arvind expects Rs 1,000 cr business opportunity from the venture
• GAP, a mass premium brand, will fit in between licensed premium brands of Arvind such as Calvin Klein, Nautica and Tommy Hilfiger, and mid-level brands such as Arrow and US Polo