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Oct, 01 2008

Building global brands in India

Bringing an international brand into India is a tough task but carrying on its operations and building its global image while keeping the Indian perspective in mind is an even bigger task. TFW showcases the skills and knowledge of some of the most success

With India being recognised as an emerging destination for international brands, there is a plethora of reports doing the rounds on a new brand`s entry with every passing day. The real work of starting operations of the brand begins once the entry route is finalised. Recruiting staff, opening new stores, branding, training, all make for a daunting task.

Here, some leading master franchisees, licensees and JV partners share their knowledge on the right approach to a successful business.

Naveen Rakhecha, CEO,
Cartridge World (South Asia)

Cartridge World started its expansion into Asia about 5 years back. The Indian operations of Cartridge World started in November 2006 with AFL Pvt. Ltd being appointed as the Master Franchisee for 6 countries in the Indian sub-continent viz. India, Sri Lanka, Nepal, Bangladesh, Bhutan & Maldives. In India, Cartridge World has 46 stores operational across 21 cities in India namely at Delhi, Gurgaon, Jaipur, Varanasi, Lucknow, Kolkata, Ranchi, Guahati, Indore, Bhopal, Mumbai, Navi Mumbai, Nagpur, Pune, Ahmedabad, Chennai, Bangalore, Hyderabad, Cochin, Coimbatore and Vizag.

Clear Roles:

Distinct roles for the franchisor, master franchisee & franchisee need to be defined. This allows franchisees to focus on store operations and sales, thereby maximising returns while the backend support is managed between the franchisor & master franchisee.

Clone ability:

Create unit operations that will be duplicable at low costs. Create processes which will be duplicable with minimum effort with systems ability to absorb small variations.

Sharing process:

The unique sharing process in Cartridge World means that we continuously learn from the experiences of masters and franchisees across the globe. Cartridge World executives maintain a quality check on us and this helps us stay abreast with global standards continuously. They participate in all major events and through their Austrade (Australian Trade Mission) connections, create opportunities for us to attract franchise prospects. Dignitaries from Austrade have participated in the launch of the Cartridge World brand and Cartridge World stores in India. We are also engaged with Austrade for exploring franchisee prospects and establishing their credentials in neighbouring countries.

Educating customers:

Introducing the organised way of refilling was a process of bringing about a change and hence challenging. In India there were very few or no specialised refill stores. Refilling in most cases was not done scientifically; a cartridge was treated like a container and ink like coloured water. The result thus was a bad product. The key to success with this segment is differentiating and continuous customer education. It is a prevalent myth that organised refills cost more. We believe `Quality speaks for itself` and thus along with ensuring efficient services we are focused on ensuring that we deliver our promise of OEM quality – affordable price every time without fail. This strategy has helped us manage the change process very effectively.

Partner with the leader:

Partner with the one who is the best and has a proven credibility and track record. Partner with somebody from whom you are sure to learn about best global practices. Partner with ones who believe in quality and are in no tearing hurry. Partner with somebody who looks at you as an equal and is ready to listen to you.

Govind Bharwani, President & Director,
Major Brands (India) Pvt. Ltd

Major Brands is a leading master franchisee of international brands in India. The brands under Major Brands portfolio are Mango, Promod, La Senza, Aldo, Nine West, Charles & Keith, Bally, Okaidi, Inglot and Aldo Accessories. Currently, it operates six Mango stores in four leading cities namely Mumbai, Delhi, Gurgaon and Bengaluru. Nine West has four stores in 3 cities namely Mumbai, Delhi and Gurgaon. Promod has three stores in Mumbai, Delhi and Gurgaon each. La Senza has three stores in Mumbai, Delhi and Gurgaon each. Charles & Keith has three stores in Mumbai, Delhi and Gurgaon each. Bally has one store in Mumbai. Okaidi has three stores in Mumbai, Delhi and Gurgaon each. Inglot has one store in Delhi. Aldo has three stores in Mumbai, Delhi and Gurgaon each. Aldo Accessories has two stores in Mumbai and Delhi each.

Customisation:

When Major Brands introduced Mango in India, it was perceived to be a luxury brand due to the pricing. Customers were not used to picking up T-shirts at Rs 690 and Rs 790. Over a period of time, when customers were aware of the brand and started buying the its products, Mango then was rightly perceived to be a premium Spanish label. Today Mango has reviewed its pricing internationally and therefore the overall collection in India is 10 – 15 per cent cheaper.

Training makes the difference:

For each brand, the brand principals fly down to India, train the staff in terms of visual merchandising, customer service, grooming and etiquette etc. Brand managers for each brand also train the staff on a season basis to ensure that all staff is perfectly trained even to handle crisis situations at the store.

Understand customer preference:

International brands like Mango, Promod, La Senza and Bally do not Indianise themselves though entering the Indian market. Being an international brand, it has to maintain its worldwide image. In terms of buying, we do the buying keeping in mind the Indian customers` likes and dislikes as well as what we feel would sell well. There is a lot of market research done for the same before the buying is done to understand the target group, customer psyche and the like.

Set a vision:

Major Brands was looking to partner with those brands that are popular world wide and saw the opportunity to introduce them to the Indian market, knowing that it would be well-received. Major Brands wanted a mix of brands under its portfolio showcasing from apparel to footwear to accessories, kids wear, cosmetics and lingerie.

Study the market:

La Senza, being a lingerie brand, we had to study the market with reference to the sizes for bras that would be selling at the store. During our launch and in the first year of the brand being in India, we learnt which are the fast selling styles and sizes and now at La Senza we are completely aware of what customers are expecting from us in terms of styles, sizes, designs, colours, etc.

S B P Pattabhi Rama Rao, President,
Australian Foods India Pvt. Ltd

No recognised cookie player in India led to the Indo-Australian JV between Australian Foods India and Cookieman in the year 2000. Currently Cookie Man operates outlets in 19 different cities including Chennai, Bengaluru, Hyderabad, Gurgaon, Noida, Mumbai, Indore, Pune, Ahmedabad, Jaipur, Ludhiana, Lucknow, Mangalore, Delhi, Vijayawada, Jam Nagar, Kolkata, Madurai and Baroda.

Maintain well-defined retail strategy:

Our product is very clearly positioned as a fresh baked range which is a distinctive positioning vis a vis our competitors. We have a well-defined retail strategy that leverages the prevailing mall phenomenon and a robust franchising model to grow the business in India.

Innovation is the keyword:

At Cookie Man, there is a continuous process of innovation happening in relation to products. Cookie Man offers a wide array of 54 different types of scrumptious cookies that are developed at an exclusive R&D centre in Australia.

Quality consistency:

In India, all the Cookie Man dough and other related materials are produced at the Chennai facility of Cookie Man. Do not compromise on the quality of the raw materials.

See the opportunity and strike:

The cookie segment of the biscuit market in India was flooded with several small players but a very clear and dominant fact was that all the outlets stocking cookies used to do so only to complete the range and were not businesses focusing only on cookies and there were no recognised players in the cookie market in India. Also Indian consumers are ready for change and are increasingly experimenting with new products available in the market. These factors coupled with the large business opportunity that we estimated, brought Cookie Man to India.

Do your research carefully and be on the lookout for a company or brand that is willing to invest in India or is looking at unveiling business in the country.

Think local, act global:

Localise your products wherever required but always maintain international standards, be it products or services to meet the choice of end customers.

Abhishek Chandra Saroj, Business Head,
Kanz India

A long standing relationship with Kanz for manufacturing and delivering Kanz products to international markets saw Kanz`s retail entry in India with Prateek Lifestyle in the year 2007. There are 12 Kanz stores operational and 8 more signed up to open up in this financial year. Apart from these, KANZ also sells through Shoppers` Stop, Lifestyle and Central malls along with other regional large MBOs viz. Ritu wear/Kalamandir, etc.

USP of the product:

With hundreds of Indian brands already in the market, the new entrant has to be different to attract customers.

Kids wear market is growing at a rate of about 13 per cent; this coupled with the fact that there are only a handful of international brands in India attracted prateek Lifestyle towards KANZ. The range on offer was very interesting in terms of newborn category which otherwise is unexplored by majority of brands.

KANZ has been operating in 32 countries for about 60 years; the product range has been carefully adapted to the market conditions over a very long period of time. Hence the range is very interesting.

Training & Support – the key differentiator:

Design and production support is provided by the KANZ worldwide team along with regular inputs on in-store branding & marketing.

Selling skills as well as visual merchandising of the brand comes along in a booklet along with the catalogues and other collaterals. Periodically, the German team does a surprise visit of the Indian stores and various other formats for their valuable inputs.

Dig in deep:

Setting up stores, expanding the brand, understanding the range and setting up a team to handle all issues is a long drawn process; if the investor is not willing to dig in deep for at least 2 to 3 seasons, then he should not think about partnering. The real estate prices are also on an all time high, hence store profitability has to be forecasted and one should be ready for any variance that might occur.

Right customers:

As of now there are three to four major large format store chains in India. The Brand presence in these formats will give immediate recognition and the brand can leverage on that to grow further.

Supply chain process:

The most important thing is to ensure that the merchandise reaches customers on time every time.

Dr. Devinder Gupta
CEO, Century 21 India

In a an effort to organise the real estate broking system in India, Dr Devinder Gupta got in touch with Century 21, impressed by its system and outlook, joining hands with the worldwide famous brand in October 2007. At present, Century 21 India boasts of 11 owned and franchise offices in India.

Invest to sustain

A company needs to invest in a mix of products/ services. Some of them will give you quick returns and keep you in business. Others will take a lot of time, but when they start delivering it is enough to sustain the organisation.

Business Development

Its business development system provides its franchisees/ brokers an access to online business development resources through its web portal century21online.com that comprises of broker financial tools in which a detailed study of profits for past years is clearly explained to promote the morale of the proposed franchisees.

Training makes the difference

Century 21 system offers world class training programmes for brokers, sales associates and franchisees. It provides specialised training on a variety of real estate topics as well as on all the tools provided by Century 21 system. It also offers a Management Development Course to its franchisees on a periodic basis so that at least one representative of each Century 21 franchised office could attend the course at least once a year. Periodically, it offers an approved VIP/Referral Training Program on a periodic basis so that all interested Century 21 sales associates could attend the programme each year.

Survive and thrive

When organisations across the world are constantly striving to achieve boundary-less branding in order to attain top recall value, global companies Indianise themselves to match with the expectation of the local consumers. World wide organisations have realised the importance of getting local as well as international flavours in their brands since this reflects the value of an enterprise. `Think global, act local` is a critical strategy for most global companies and modifying one`s core business culture and practices to suit a new market is the key to survival.

Management

Management strategies must be organised to facilitate the effective running of business and maintaining profit that maximises productivity and profitability.

Develop strategy, enable growth

With the Indian consumers` craze for change and given the love of experimentation with new products, Indian investors stand a good chance at being successful, provided they identify the need gap in the market and introduce the right products and services. Building a product`s market in India can be easy if you spend some time on researching the brand`s USP which will work in India and educating Indian consumers about it like in many cases done by our aforementioned Indian investors.

It seems that the time is ripe for Indian investors to reap the benefits.

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