The Hindu Business Line : VF Arvind targets 15% sales over Net in three years

Mumbai April 11 The Rs 220-crore VF Arvind Brands is planning to tap into an alternative retailing model through the Net. The Bangalore-based company has decided to use e-commerce as a viable retailing option in the near future, with a dedicated Web site to vend its VF brands.

Value propositions

Speaking to Business Line, Mr Darshan Mehta, Chief Executive Officer, VF Arvind Brands, said, "We are already working on the back-end operations for our foray into e-commerce. There would be value propositions for our customers on the Net. We expect nearly 15 per cent of our turnover to come from the Net in the next three years.'' The US-based VF Corp generates $100 million through its Net operations.

In India, there have been impediments to the growth of e-commerce but progress has been made in areas like e-ticketing in the airlines industry.

As Mr Mehta says, "The airline industry has made a success of e-commerce through its e-ticketing operations. Besides, now there have been improvements made in the security systems and the distribution broadbands.''

Bundled offers

Creating value propositions for its Net consumers, VF Arvind would have `bundled offers' with a range of big and tall collections and customised solutions for its seven-odd brands.

In fact, the Web site would create subsets for the various brands for customers to fine-tune their requirements.

With its special focus on the denim and outdoor category, there are more VF brands lined up for launch in the Indian market.

Brands such as The North Face (outdoor brand) and Napapijri (denim brand) are soon expected to add to the existing VF brands in the country.

Its denim brands such as Lee and Wrangler have already captured between 6-7 per cent in the Rs 4,000-crore denim category.

"We would like to increase our share of denim brands to 10 per cent of the market,'' says Mr Mehta.

Premium line

In fact, the company has already been trading up its prices and range for its premium denim brands. While Lee has introduced a more premium line of `Reds by Lee', of late Wrangler too has got its John Abraham Celebrity line, with prices escalating between Rs 4,000-5,000 for a pair of jeans.

Main challenges

Meanwhile, people and real-estate costs continue to remain the main challenges for the company.

"There are two main challenges — the real estate costs which have gone up by more than 100 per cent and the fact that it is not cheap to get senior people who expect dollar salaries,'' says Mr Mehta.

VF Arvind is already investing Rs 50 crore in setting up standalone stores for its brands such as Nautica, Kipling and Jansport.

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