Retail News: Crystal jewellery and accessories maker Swarovski has put in an application to form a 100% owned single-brand retail subsidiary in India, a person familiar with the company’s plans said.
The development makes the Austrian firm the first global high-end company to opt for a fully-owned single-brand unit in India.
Sukanya Dutta Roy, managing director (consumer goods business) at Swarovski India, declined to comment on the company’s future plans and the FIPB application. The person quoted earlier said the company wants to ensure better control of its retail operations in the country and that is the reason why it has applied to the Foreign Investment Promotion Board (FIPB) for a 100% retail entity.
Currently, Swarovski sells its products through 34 franchise stores operated by various partners across India. India allowed retailers that sell products under a single label to own up to 100% stake in local ventures in January last year. Under the 100% single brand retailing clause, the company must source 30% of its products from within India.
The person said that Swarovski could easily meet this target as it already runs a production unit in Pune to manufacture crystal pearls, which is a completely export-oriented unit now.
The person, however, said Swarovski does not have an aggressive retail expansion plan in the immediate future given that it already has considerable presence and visibility in the market. Swarovski entered India in 2000 by setting up its Pune plant. A few months later, it started enlisting franchisee operators to sell its products.
Swarovski, which operates 2,350 stores in 170 countries, posted a turnover of 3.08 billion , or about Rs 26,200 crore, in 2012. In the Asia Pacific, it has 700 outlets.
Source: timesofindia.indiatimes