Breaking partnerships and joining new hands, trial and error is the way to go for international luxury brands in India
By: Rasul Bailay & Anumeha Chaturvedi
Posted on: December 23, 2015
The musical chairs of global luxury brands in India continue as a host of international companies are switching partners in the country in a bid to find the elusive winning combination. Italian label Billionaire, which was expected to sign an agreement with Infinite Luxury Brands, has instead decided to partner Dubai-based BinHendi Enterprises while German brand Hugo Boss is ending a 29-year partnership with BinHendi to tie up with Genesis Luxury. Some others, like French brands ST Dupont and Brioni, are on the lookout for new partners, industry insiders said.
A person familiar with Billionaire said the Italian company's deal with Infinite Luxury did not get through due to some issues that he declined to elaborate on. Designer Manav Gangwani, cofounder of Infinite Luxury, said: "We were in talks with them one and a half years ago, and we did not sign any agreements with Billionaire."
Mohi-Din BinHendi, president of BinHendi Enterprises, told ET that another luxury brand is breaking away with its India partners and is moving to his firm. "It is in the process and legally I can't name them at the moment," he said. BinHendi is, however, losing Hugo Boss to Genesis Luxury with effect from January 31 next year. "They want to expand extensively and we are not prepared for that at the moment," BinHendi said.
Sanjay Kapoor, managing director at Genesis Luxury, said: "A few brands have moved to our group from their initial partners over the past few years. Some of these are via marketing and distribution arrangements with Genesis or as joint ventures."
Italian luxury house Versace, which partners Infinite in the country, however, is teaming up with OSL Luxury for Versace Collection, sources said.
Salesh Grover, business head of OSL Luxury that sells Italian chic label Corneliani in the country, declined to confirm partnership for Versace Collection. He said the firm is in talks with many global brands but has not finalised anything as yet.
Saloni Nangia, president at retail consultancy firm Technopak Advisors, said luxury brands usually sign contracts with Indian partners for 3-5 years and want to evaluate whether the Indian partner is able to grow and expand the brand as required during the period. "The Indian partner may want to opt out of the arrangement as well after the contract gets over as they may not see growth," she said.
The India partner of a global luxury brand echoed her sentiments. "When a brand chooses to enter India there are potential suitors, but overtime they realise that the arrangement is not as good as on paper and that may lead them to scale back expansion and close down stores," said the person.
ST Dupont is reportedly unhappy with its Indian partner Jot Impex and is in talks with another retailer. Sources said the French luxury brand has reportedly shut down its store in Delhi and another one in Palladium Mumbai. Brioni is looking for a new Indian partner, sources said. "They had opened their store about three months after the terrorist attacks in Mumbai and business didn't really pick up," according to a source.
(Article originally appeared in ET Retail)