India is the fastest growing market worldwide for apparel brand US Polo (USPA) and has the potential to be their largest market, J Michael Prince, President and CEO of USPA Global Licensing, told ET.
Indian currently represents over 15% of the overall business worldwide and is the third largest market after the United States and Turkey.
“India has the potential to be our largest market, how soon that will be, I don’t know but I think it just has tremendous potential. It has a large young population, demographies are changing with wealth creation and it is one of the world’s great economies and only getting better each and every day,” said Prince.
Arvind Fashions, the licensee to sell the brand in the country launched this brand in the market in 2009.
“And it took us 10 years to hit Rs 1000 crore and we are hitting the next Rs 1000 crore in five years. So that’s how the brand is accelerating and going from strength to strength,” said Kulin Lalbhai, director at Arvind Fashions.
For USPA the overall global business in terms of retail sale was $2.3 billion as of 2022 and it grew the business about a billion dollars for the last five to six years.
USPA has 425 stores in India and in terms of store count, India is number one for the brand.
Arvind Fashions gets 80% of revenue from power brands. And USPA contributes 60 percent to power brands.
“We want to create very large power brands. Even though this is now reaching the scale, which makes it the largest casual wear brand in the country, we believe there is a massive runway of growth,” said Kulin Lalbhai.
Over time the company plans to make this a half a billion dollar brand. The company plans to open 50 retail stores every year and the store size has also been increasing year on year.
“While the average store size used to be 1000 -1200 square feet, it is now more than 1500 square feet. Retail as a channel is going to be a big growth driver. US Polo is opening stores not only in the tier one, tier two towns, but it’s even opening a lot of stores now in tier 3 towns,” said Lalbhai.
For Arvind Fashions USPA is retaining its value proposition and appeal even after the entry of global rivals such as Zara and Uniqlo.
“There are multiple brands that are successful. For us, the brand has been accelerating and it is still growing at a very healthy clip,” said Lalbhai.
Due to the rising cost of raw materials, the company had raised the prices but said it has not impacted the sale.
“We raised prices globally. And the consumers still engage very highly with the brand so it was a strong year despite some some price point increases,” said Prince.
The company expects to maintain the same growth momentum in future.
“India has been a strong performer overall around the world, we have seen interest rates going up, inflation impacting the world economy, there is a lot of political volatility in the marketplace but ours is an extremely strong brand and I actually see that as an opportunity because we are a great price to value proposition,” said Prince.
Arvind Ltd, the manufacturing arm of the company might manufacture for US polo global in future. Currently for India, over 90% of the manufacturing happens within the country.
“We are always talking to the biggest brands for manufacturing. We will explore all possibilities as we are constantly approaching the largest brands that we work with,” said Lalbhai.
India offers an important platform to bring American casual style to consumers around the world, at a time when Indians are increasingly embracing western-style clothing.
AFL has reported sales of Rs 957 crore in April-June quarter, with the growth of 4%. The like to like retail growth in this quarter is 4%, which has come on a high base of last year where the retail like to like last year in the same quarter had grown at 25% over pre COVID level.
