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Levi's to rev up India retail plans — To foray into mid-priced jeans segment

26-April-2005
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Levi's to rev up India retail plans — To foray into mid-priced jeans segment

The $4.1-billion Levis Strauss & Co has declared faith in India's growing apparel market.

The global jeans giant has placed India at the top among its three focus markets for growth in the next three years. An internal business document of the San Francisco-based company identifies China and Russia as other important growth markets for its branded apparel business led by the eponymous Levi's trademark.

And in sync with the plans, the company is revving up its retail plans in India, besides foraying into the mid-priced domestic jeans market with Levi's Signature sub-brand. The company will start test marketing Signature sub-brand from September this year onwards in the price band of Rs 599-Rs 999.

On the retail front, the company hopes to set up 300 exclusive stores - roughly 150 each between Levi's premium products and Signature - by 2008. Levis Strauss & Co entered the country in 1994-95, and has a better exposure here than in China where it forayed a little over two years ago.

According to Mr Shumone Jaya Chatterjee, Managing Director of Levis Strauss India Pvt Ltd, the retail expansion on the anvil will cover about 62 cities across the country. As the company is already present in about 50 Indian cities with its Levi's and Dockers brands, a substantial part of the retail expansion would be focused on increasing the network in the top metros and in other existing markets.

"We are looking at a scenario where every second exclusive jeans in these markets will be Levi's," Mr Chatterjee said.

The flagship Levi's brand, which accounts for bulk of the sales, is expected to close this calendar year with 75 exclusive stores. The Indian operations closed the last financial year (ending November 2004) by reporting a volume upswing of 55 per cent and a revenue growth of 62 per cent. The first quarter of the current financial year (December-November) has seen volume and revenue growth of 39 per cent and 42 per cent respectively.

With its domestic business coming out of the sluggish patch it entered in the late 90s, Levis Strauss is rolling out its lower-priced Signature jeans, which if succeeds in India, could be the giant's turning point in the country. The test marketing and the roll out of Signature jeans is scheduled to start from the South, which is incidentally not a big jeanswear market compared with the West and North. India's jeans market is pegged at 24 million pieces annually, and growing at 10 to 12 per cent with the premium segment, priced above Rs 999, registering higher growth of 15 to 20 per cent annually.

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