French menswear company Celio to increase local sourcing

French menswear company Celio International is planning to take the franchise route and increase local sourcing in the country.

With 41 stores and 130 shop-in-shops, Celio had entered the country six years ago through a joint venture with Future Lifestyle Fashion. Since then it has steadily increased its stake from 50 per cent earlier to 97 per cent.

Rajiv Nair, CEO, Celio Future Fashion, said: “We need a franchise model to penetrate smaller cities and high streets as there are plans to open 8-10 stores every year. As a company we become less capital-intensive with franchises who can make the business run profitably.’’

Celio is the largest selling menswear brand in France with a 18 per cent share. Almost two years ago, the owner of Celio International, Marc Grosman, had visited India to apply for higher FDI, which is allowed for single brand retail. Since then the French company has been steadily increasing stake and hence bringing in capital to build the business in India.

“There has been capital infusion from Celio International as we have increased our stake to 97 per cent while the balance of 3 per cent is still held by Future Lifestyle Fashion,’’ added Nair.

Celio is now gearing up for competition as international brands have been steadily entering the market with companies like Zara, Gas, Gap and now H&M making their way to India. “Today, we have 18 per cent growth among our like-to-like stores but have to wait for another year before we can make money in India,’’ said Nair.

E-commerce is also a channel being explored by the retail company as almost 9 per cent of sales currently come from this channel.

“We still cannot do e-commerce directly but once we get FDI complaint we may look at a payment gateway from our company site,’’ said Nair.

Also local sourcing is expected to increase from 60 to75 per cent as certain products cannot typically get made in India. Celio continues to outsource from places such as Tirupur, Bengaluru and Ludhiana.

As Nair adds, “While we have to follow the norms for local sourcing, there will continue to be imported items like jackets which are best made abroad.’’

Celio continues India focus, targets opening 100 stores by ’16

Celio, the French fashion retailer is all set to strengthen its connection with Indian customers. The brand, is eyeing a bigger pie of India’s organized menswear retail market. Celio brings an essentially urban European fashion trend through its collection of shirts, jackets, waistcoats, trousers, suits, jackets and accessories.

In India, Celio offers a wide range of smart casual, business wear, sportswear, clubwear and denims. Celio had stepped into the country in 2008, the brand opened its first store in R City, Mumbai in 2009. Today the brand runs 40 exclusive brand stores which are fully company owned and operated and 128 shop-in-shops. The brand has also penetrated through large format stores like Pantaloons, Central and Lifestyle. Celio is looking at rolling out 100 stores by 2016.

Riding the booming e-commerce wave, the brand has already registered 7 percent of its total revenue in the domestic market through online sales. It has tied up with leading ecommerce portals like Myntra, Jabong, Flipkart and Amazon. “The urban Indian youth is aspiring for fast, effortless fashion. In India the younger generation is as fashion seeking as their global counterparts. They have exposure of international trends through the net, TV and mobile. We want people to come up to us for global fashion,” says Rajiv Nair, CEO, Celio, Future Fashion.

Driven by a strong conviction in India market, the brand is eyeing deeper penetration through retail expansion and a strategic communication plan targeted at young consumers. “We are essentially a retail oriented company which means our philosophy or strategy is store, product and customer service centric. We are exploring various routes to increase our penetration and strongly believe internet is the way,” he says.

“We have a legacy of two decades and in India we are just a starter, we are still understanding the market. We see ourselves as a retailer first, backed by a fantastic manufacturing set up. We manufacture four crore garments in Asia per annum and 10 lakh of these per annum are for India. We are taking the slow route. We have set the route and standards. Now, our goal is to get profits at the corporate level,” adds Nair.

Although the brand is not in a hurry to open franchisee stores it does plan to slowly tap that route. “Even though we are looking at franchisee stores for expansion, it won’t be bigger than our company stores. We understand that we have to take the franchisee route to get into smaller territories,” sums up Nair.