The Hindu Business Line : Samsonite looks to shed baggage of pure luggage brand

Chennai, Aug. 15 Global luggage company Samsonite plans to invest $18 million or approximately Rs 77 crore in India over the next two years. This is besides the Rs 150-crore investment already earmarked by the company to increase its capacity at its Nashik plant, its largest unit across the globe. Speaking to Business Line, Dr Ramesh Tainwala, President – Greater Asia, Samsonite, said, “The money will be pumped in to refurbish the company’s 343 stores in India.”

The revamp, says Dr Tainwala, is part of Samsonite’s repositioning strategy — to lifestyle brand from luggage company. “We have realised that being just a luggage store does not really pull in too much of a crowd. In these newly revamped stores we will have a range of products including shoes, watches and eyewear,” he added. Samsonite South Asia is a 60:40 joint venture between Samsonite Global and Dr Ramesh Tainwala. “Part of the money will be invested by the Indian company and the rest will be borrowed locally,” said Dr Tainwala. The company has already completed refurbishing three of its stores in Chennai in prime locations. It plans to cover the six metros before March next year, and the stores in Tier -II and -III cities will be covered in the second phase. “All the stores that are bringing in more than Rs 15 lakh a month will be covered in the first phase. It will be done on the basis of the value size of the store and not on the physical size,” added Dr Tainwala.

Samsonite, which will complete 100 years of existence next year, has hired a French architect to re-design all the stores. “We have added more colours to our signage and kept the size of the signage small, making it look elegant,” he said.

Among the products that the company plans to launch in India is its range of footwear, by the end of this year. Others in the pipeline include eyewear, watches and stationery. Besides, the company is also planning to licence Timberland and Lacoste brands to launch luggage products in India. Its other brands include the high-end Black Label and the mid-market American Tourister, which was launched last year. “We have grown phenomenally in the mid-market segment in the last one year,” said Dr Tainwala.

American Tourister enjoys a 20 per cent market share in the mid-market segment, while Samsonite as a separate brand claims 20 per cent of the total luggage market, which is currently valued at Rs 2,000 crore, of which the organised sector accounts for Rs 950 crore.

VIP, which does not have a separate brand for the mid-market, holds 44 per cent of the total market share in the luggage industry.

Meanwhile, the company also plans to exit four malls in various metros. “It is not about deriving business value or anything. We are just unhappy about the way the malls are being run,” said Dr Tainwala. At the same time, he maintains that the company is still in talks with the mall owners if a concession in rental can be worked out before it finally decides to call it a day at these malls.

India’s share in Samsonite’s global turnover is expected to increase from 7 per cent to 10.5 per cent by 2010.

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Samsonite to extend non-luggage portfolio

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