The client, a leading brand in the women’s handbags and accessories industry segment, was keen to launch its own chain of exclusive stores. They had forayed with one store which was not performing. The client engaged with us to adopt the right strategy to successfully launch a retail chain.

Solution

We discovered that the brand, although present in various departmental stores, did not have the desired display and visibility. Also, with modest Marketing budgets typical of a small size brand, it was clear that the retail stores in territories outside of the brand’s hometown would have struggled in getting sales and delivering the required return on investment.

We strategized to exploit the presence in departmental stores first to get the revenue. We advised on changing the business model/terms of trade with the organized retailers that quickly led to a multiplier effect on brand’s Sales and grew it manifolds , at the same time saving 5% on margin payouts too. This breakthrough result on Sales and gross profits propelled the brand growth forward. The company could invest in more production units, expand its product range, and spend on Marketing.

The country-wide presence of departmental stores helped build recognition of the brand in India over a period of time. In a few years, the exclusive brand retail shop foray could be entertained, even in towns outside of the brand’s hometown.

We built a feasibility model of an exclusive store. First, we arrived at the right format size that would respect the brand’s product range and would deliver on sales & inventory investment. We built a small model that would paint scenarios on sales, expenses, and investment. We brought market intelligence to the table on cities/markets/malls to locate in, along with guidelines on rental payouts.

Outcome

The brand built a name for itself with pan-India awareness and acceptance over the medium term. Its foray in launching exclusive brand retail was successful and paved the way for the next cycle of business growth.