Raymond: Weaving Business Profits

A complete man can never be complete without having a range of apparel made by Raymond in his wardrobe. One always gets a sense of fulfillment once he goes through the Raymond experience. The company, since its inception, has been offering great quality, distinct service, and unmatchable experience to its customers.

Raymond’s first exclusive brand store was launched in 1958 and since then it has grown in its retail strength. Their expansive product portfolio, relentless focus on quality and retail lineage has created numerous milestones and success stories over the years. This has translated into brand’s expansive retail network across varied formats with 1,100 stores across 400 towns in India, and is still growing.

Raymond’s legacy is built on three pillars: firstly, consistent desire to be the best in class in terms of the products. Secondly, the connection with the consumers and how consumers trust the brand. It is rated as number one brand in terms of quality and trust in India. Thirdly, the success of its channel partners, which is a franchise-led network. The support of their franchisees and channel partners are with them for three generations.

In 1925, the company was first incorporated as the Raymond Woolen Mill near Thane Creek, Mumbai. Lala Kailashpat Singhania took over the company in 1944, and in 1958, the first Raymond Retail showroom was opened in Mumbai. “The Raymond Shop was conceptualized in 1958 with our first exclusive company-owned store at Ballard Estate in Mumbai. Thereafter, we initiated with the franchise run – The Raymond Shop – from the early-70s to spread our presence across the country,” said Mohit Dhanjal, Director - Retail, Raymond Limited.

The Better Halves

In association with its franchise partners, the brand has evolved as the most innovative yet experiential brand with its brick and mortar retail format, which promises a great shopping experience.

“Our partnership with franchisees is driven by transparency and ethics in business dealings. Trust and respect is the foundation of Raymond’s franchise network, which also has one of the leading franchisee networks in India. In fact, the heart of our franchise model is based on franchisees’ passion, where his entrepreneurial spirit is tapped for exponential growth through impeccable last mile service delivery,” added Dhanjal.

Presently, the company operates through one of the largest exclusive retail networks in the men’s lifestyle space in India. Of its total retail network of over 1100 outlets, 720 stores are operational via The Raymond Shop format. This format is largely a franchised retail channel with about 660 shops being run and managed by franchisees that constitute around 58 per cent of its total lifestyle business.

The franchise relationship has growth and strengthened over the years and currently over 200 franchisees are third generation entrepreneurs who have now taken over the reins of the franchise outlets from their parents and are successfully running the business. The key to its success lies with the conduct of engagement and training programmes it provides on various subjects pertinent to modern retail like product training, customer relationship management, staff development, visual merchandising and operations, apart from evolving product portfolio that ensures the product offering is in line with the changing consumer preferences and requirements.

When Small Is Big – Mini TRS

The retail growth in India is led through raising demand and awareness across India’s small towns and cities, where emerging demographics, rising spending power and growing urbanization has escalated to another level. Raymond has taken note of this opportunity, and in its first phase of retail expansion in 2008, it rolled out over 300 Raymond Shops in tier I & II towns. According to the company, there are now over 800 new potential towns in India with population of above 50,000 that have the potential to support a small format Raymond Shop.

“By leveraging local knowledge and experience of our franchisees, the small format Raymond Shop will represent our brand Raymond in these new emerging towns and will be beacons of modern retail for these markets. We ahave a very big network of outlets in tier I, II and III markets and now the focus is on tier IV and V cities,” shared Dhanjal. “And hence, we are well aware of the great potential these new 800-plus towns will offer.”

Spread over 600-1200 sq. ft, these small format Raymond Shops (referred to as ‘Mini’ TRS) feature a completely new retail store design that engages consumers with its product-focused design and retail ambience. The modular design of the shop offers high design flexibility in product displays reducing the cost and implementation timelines in setting up the store. It also has an integrated digital omni-channel capability, through which the customers can access a curated range of products through its online webstore – Raymond Next. These stores are also equipped with a ‘live’ music and video channel that provides a select playlist.

The company is seeking like-minded entrepreneurs, who have the right attitude for customer service and have a growth mindset to partner for retail expansion into these new 800 emerging towns.

Changing Retail Strategies

The company is constantly focusing on rejuvenating stores, accelerated footfalls, driving higher sales conversion, enhancing store profitability and outperforming the sectoral growth average. At the store level, its four pillars are - (A) evolving the brand identity and retail format by making it more relevant to the aspirations of its customers; (B) by innovative and engaging product portfolio and visual merchandising that provides a total wardrobe solution to The Complete Man; (C) thorough improved experiential customer service at its stores by empowering a well trained customer facing team to deliver sustainable and high quality engagement in every interaction; and (D) through upgrading technology at the outlets (POS) to capture customer transactions, customer history and drive superior loyalty campaigns for a higher level of engagement with its customers. These initiatives have already resulted into same store revenue growth of the renovated Raymond stores growing four times faster than the non-renovated stores.

One-stop Solution

The company is in the process of re-configuring the organization to cater to evolving customer needs. “There has been a significant momentum on market-creating innovations like the launch of new product like Technosmart – the world’s smartest fabric. We have recently owned the white shirt category in the country, Raymond Whites, coupled with the launch of world-class products such as lightweight jackets, and auto-fit shirts and top-end sweaters for our customers. We have launched shoes from Raymond made to measure and introduced new categories like Linen and Supima Cotton,” said Dhanjal.

In its latest initiative, Raymond recently partnered with the Khadi & Village Industries Commission to introduce a line of Khadi collection. Through this, the brand is hoping to make a shift in people’s perception of Khadi from a fabric that stands for nationalism, to one that also stands for fashion.

Balancing the Sheets

In terms of turnover, Raymond has been growing by 8 per cent Y-O-Y. The small format stores’ model has helped it to expand in the new markets with potential of Rs 1.5 crore of retail sales and above. According to a media report of 2016, the company is aiming to achieve a turnover of Rs 10,000 crore in the next four years by boosting the revenue generated from its branded garment business of worth around Rs 1,000 crore and doubling the worsted fabric business of worth Rs 3000 crore.

Q&A

Raymond is built on three pillars: Mohit Dhanjal, Director-Retail, Raymond

How do you describe the complete man?

The complete man is someone, who is connected to his community, is caring, loving and while he is ambitious, he is also aware of the consequences of his action and therefore is committed to the overall development of his society. It’s about how can you elevate yourself above the basic needs and it’s not just about winning but actually making sure that everyone associated with you wins. So you do good while you look good.

What are your memorable moments with Raymond?

Last year in August, when we had a tie-up with NGO called Goonj for a social initiative. We encouraged our consumers to donate their old trousers and in return we gave free tailoring to them. We collected over 2,10,000 trousers that were given to GOONJ, who use these garments as a currency to get community work done in villages and small towns. For the participants, it was not about free tailoring that he was getting from Raymond but he wanted to be part of this social initiative and give something back to the society.

Which favorite international menswear brand you prefer?

Raymond is my favorite brand. It is as international as any other MNC brand. I used to be the big fan of Abercrombie and Fitch, when I was in my twenties.

What is your formula for growth for the Retail Channel in Raymond?

My growth formula is based on 4Gs –

Growth that is a head of market growth; Growth that is sustainable; Growth that is profitable; Growth that is wholesome like growth for our franchisees, partners and the organization.

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