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Italian luxury brands Canali, Brioni plan India expansion

28 Mar 2008



NEW DELHI: With the Indian luxury market set to touch $30 billion by 2015, Italy's premium menswear brands Brioni and Canali are firming up plans
to strengthen their presence in the country.
Brioni, which opened its first boutique store in Mumbai last year in partnership with its franchisee Badasaab Designs, is all set to launch two new stores this year. Similarly, Canali, which currently has two franchise outlets with Genesis Colours, plans to have eight by 2010.
"We feel that the Indian market is more mature than other Asian markets and that is why we want to expand operations here. Our second store will open shortly in Delhi, while the third one will come up by this year-end in Bangalore," Brioni CEO Andrea Perrone said on the sidelines of the Mint-Hindustan Times Luxury Conference.
The company expects to start making profits from its Indian operations from next year.
Echoing similar sentiments, Canali Sales and Marketing Director Paolo Canali said, "By 2008-end, we will have five stores with two coming up in Delhi and Bangalore within six months, eventually going up to eight by 2010."
He said the company might also look at sourcing fabrics and natural fibres from India. "We are very closely monitoring some of the Indian companies which are providing very good quality fabrics, though we have not finalised anyone as yet."
However, the Italian majors feel that availability of quality locations for luxury retailing was an issue.
"We are finding it difficult to find the right kind of space and location to execute the plans," Brioni CEO Perrone said.
Expressing similar views, Paolo Canali also said that the company's expansion plans in India would depend on getting ideal locations.
 

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There is something grotesque about the notion of the 0.00000001% of the population being high rollers who can afford to dress in Italian luxury labels while most of the rest of the country continues to stumble along in grinding poverty.
 

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Discussion Starter · #3 ·
There is something grotesque about the notion of the 0.00000001% of the population being high rollers who can afford to dress in Italian luxury labels while most of the rest of the country continues to stumble along in grinding poverty.
the luxury market set to touch $30 billion by 2015, which means the economy out there is rapidly growing, which is actually the case :icon_smile:
 

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I am Indian. I know what the reality on the ground is. The luxury market that you speak of is accessible to a vanishingly small minority of the people. The vast majority of the population ekes out a very difficult existence.
 

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Discussion Starter · #5 ·
I am Indian. I know what the reality on the ground is. The luxury market that you speak of is accessible to a vanishingly small minority of the people. The vast majority of the population ekes out a very difficult existence.
And I am Indian. And I know there's a growing upper middle class that can and will get their luxury goods. Visited last year and was amazed by the progress.
 

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I'm not an Indian, ....

but there are very few people in the US who can afford Brioni. Hopefully, Barak Obama, will make those people on Wall Street and in Finance who have wrecked havoc with the economy, never to be able to afford Brioni again.
 

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And I am Indian. And I know there's a growing upper middle class that can and will get their luxury goods. Visited last year and was amazed by the progress.
There's a growing middle class that lives on ostentatious displays of wealth, grotesque even by western standards, right next door to the slums where people are dying for want. There is no doubt they can afford it but it doesn't make it any less nauseating.
 

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A small percentage of a billion people is still a lot of people. Luxury goods are always out of reach for most, of course. I understand your concerns about the poverty in India, but there is no doubt that there is a growing middle class. Things are certainly getting better for a lot of people.
 

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Don't get me wrong - there is certainly a growing middle class in India with a great deal of disposable income and I don't begrudge them their right to spend their money as they please. However, in my experience, the nouveau riche haven't mastered the art of understated elegance. I have been turned off by the garish display of ostentation in my visits to the home country. And believe me, the tide isn't lifting all boats. Those who are in the IT or computer industries, sure.... they may not think twice about dropping the equivalent of a couple of hundred dollars on an evening of dining and entertainment, but the resulting increase in the cost of basic goods and services has a tangible impact on the rest of the population that is not so fortunate.

I think this thread is veering dangerously close to the Interchange, so my apologies! :)
 

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With the weather and the pollution in Bombay being what they are, I don't know what sane person would walk around in an expensive Brioni suit with a shirt and tie. 10 minutes outdoors will have you dripping in sweat from the heat and humidity but the bigger issue is the sweat will turn black from the pollution in the air.
 

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I would like to throw my 2 cents in if i could.

I am of Indian Origin, though born and raised in Canada. I was in New Delhi only about 2 1/2 weeks ago. I have to say there is an incredible demand there for moderate to luxury goods there - from moderate lux like lacoste all the way up to Zegna, which opened stores last year and are doing phenomenal. On top of that, Zegna is selling fabric to the countries 1000's of independant tailors (which still make up a substantial amount of the shirting and suiting business in India).

People have to remember that India only gained their Independance 60 years ago...before that there were heavily oppressed by the British for the previous 200 years. And thier economy wasn't properly opened up until about 12 years ago. the progress they are making and at the speed they are progressing is unprecidented in the history of the world with perhaps the exception of China. though there is a lot of poverty still, it is less than it was just a few years ago, and it will be even less in the future. Yes, only a fraction of the population can buy lux items, but that is true in every country. it may be a smaller fraction in countries like India, but that is only because the population is so huge. It is projected that by 2015, there will be an UPPER MIDDLE CLASS in India of 300 million people - can you imagine the purchasing power these people will have?

how many years did it take the Western Countries to get where they are today...the US didn't really become a super power until the collapse of Britain after the second world War...so it took them some 150 years what India may achive in half that.
 

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Discussion Starter · #16 ·
With the weather and the pollution in Bombay being what they are, I don't know what sane person would walk around in an expensive Brioni suit with a shirt and tie. 10 minutes outdoors will have you dripping in sweat from the heat and humidity but the bigger issue is the sweat will turn black from the pollution in the air.
During winters it can snow in Northern India, and it can get really chilly sometimes even in Mumbai.
 

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Whatever the poverty situation in India, the fact is people want and can afford these brands. It would be silly not to market in India.

Whatever the weather and pollution situation, I am sure the likes of Brioni will be able to have clothing suitable for the Indian market.
 

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Discussion Starter · #18 ·
Good news for Indian zegna lovers:

Ermenegildo Zegna Opens Flagship Store

in Mumbai, India

India, Mumbai - May 29
th
, 2007 - The Ermenegildo Zegna Group, the world leader in luxury men's clothing
officiate its first directly operated flagship store in India at the Taj Mahal Palace and Tower. This new
opening is an integral part of Zegna's worldwide expansion plans. Also, it establishes a new pillar for the
Zegna brand in India, being one of the first luxury brands under the new Foreign Investment Promotion
Board's guideline for Foreign Direct Investment in single brand retail, to enter the Indian market with a
majority investment of 51%.

"We are extremely excited about the new flagship store and the Zegna brand in India." commented Dr Paolo
Zegna, Chairman of Ermenegildo Zegna Group, who was present at the religious Indian puja ceremony to
inaugurate the opening of the store. "This reinforces our pioneering spirit and we are proud to be the first
majority owned Italian luxury brand to enter this dynamic and prosperous market. Zegna has almost 100
years of heritage in quality and innovation, our discerning Indian customers that shop abroad can now have
all the Zegna collections at home in India. I believe the timing is perfect considering the tremendous growth
that is taking place in India."

The Taj Mahal Palace and Tower opened in the year 1903 completed its 100 years a few years back. It
brings together Moorish, Oriental and Florentine styles of architecture and is a beautiful heritage landmark of
Mumbai facing the Arabian Sea Front and the Gateway of India.

Located in the most prestigious section of the century old Heritage Wing of the Taj Mahal Palace and Tower,
this 3000 sq ft. boutique is the largest luxury boutique in India and the first to have has its own street access
with a feel of a free standing store. Designed by Architects Gianmaria and Roberto Beretta in Milan, the store
utilizes a variety of colours, natural textures and furnishing details to distinguish between the different
collections inside the store, always keeping intact the Zegna heritage of timeless style and sophisticated
elegance.

All lines are available at the new flagship store: Ermenegildo Zegna known for its sartorial style and refined
elegance, Zegna Sport - a collection of urban casual and performance sportswear; and Z Zegna, the modern
fashion forward label of the Group. Leather accessories, including shoes, bags and small leather
accessories are also available. For our connoisseurs of superlative expression, Zegna's exclusive Su Misura
service is offered where the discerning customers can their have their suits, shirts and ties made to measure
using the finest Zegna fabrics, according to their individual tastes and preferences.

The Ermenegildo Zegna Group is the world leader in luxury men's clothing. The Group is still a "family
business" and is managed by the fourth generation of the family: Paolo as Chairman, Ermenegildo as CEO,
Anna, Benedetta, Laura and Renata Zegna. It has a yearly output of 2.3 million meters of fabric, 600,000 suit
units, 1.6 million sportswear items, and 1.75 million textile accessories. It employs more than 6,000 staff
worldwide and has achieved a gross revenue of €779.4 million Euro in 2006, 90% of which is derived from
clothing and accessories, 10% from textiles, and over 86% of all sales are exported. At the end of 2006, the
Ermenegildo Zegna Group has 501 mono brand points-of-sale in the world, of which 198 are fully owned.

Italian luxury menswear retailer,Ermenegildo Zegna, is planning to sell fabric to Indian tailors to make suits in addition to the off-the-shelf and custom-made shirts and suits it currently sells to expand its offerings here.
The tailors will not be allowed to use the brand name Zegna for the finished products.
Zegna is known for bespoke suits and these have been among the highest selling at its only Indian store-at a South Mumbai hotel. But the company is now exploring the idea of bringing a small division that sells fabric from its textile mill to local tailors.
"India has a great tradition of good tailoring and our fabrics would complement it well," Anna Zegna, the group's image director and store planning director said during a visit to Mumbai in October.
While Zegna focuses on its retail stores, it has a small division that operates in several countries that sells fabric to tailors. The company has a stringent process to choose tailors who will get Zegna fabric. This includes the quality of their tailoring, their clientele and the space they can provide.
Zegna was the first luxury retailer to own majority stake in its Indian operations after the country passed in 2005, a law allowing global single brand retailers to own a majority stake in their local operations. Apart from its flagship store in Mumbai, Zegna is setting up stores in New Delhi and Bangalore. It will also look to open stores in tier-II towns.
"Currently our focus is on establishing the Zegna retail operations," Shantanu Mukherjee, Zegna's India managing director said. "India will be an important market for our fabric business but maybe at a later stage."
Zegna could also start selling the traditional bandgala (jackets with a closed neck) jacket at its Indian stores as soon as Spring 2008. Bandgalas are among the most popular requests in the Indian made-to-order business, Mukherjee said.
Consulting firm Technopak estimates the size of India's luxury market at Rs2,400 crore and expects this to grow by 30-35% a year. Luxury retailers are increasingly looking at localizing their offerings to cater to this increasingly important market.
French luxury retail group, Louis Vuitton Moet Henessey will set up its first non-European factory to make shoe soles in Pondicherry. And Brand Marketing India, which is the Indian partner for international luxury retailers such as La Perla, Gucci and Jimmy Choo, has launched a luxury wedding service this season to provide packages for the wedding season.
French luxury retailer, Eternite Noir et Blanc, announced recently that it would manufacture and sell Indian lehengas to cater to the Indian wedding market.
 

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I would like to throw my 2 cents in if i could.

People have to remember that India only gained their Independance 60 years ago...before that there were heavily oppressed by the British for the previous 200 years.
This is simply not historically correct. Until the 1850s only a few small outposts were controlled by any British entity - the East India Company to be specific. After the "Mutiny" - which was a power struggle between the Company and some Indian royal families, not a national liberation struggle - the British government took over company property. At no time did Britain exercise direct rule over 50% of the territory now comprising India, Pakistan, and Bangladesh. Less than a century later the British left, having transformed India from a congeries of warring states ruled by absolute monarchs, existing on a subsistence economy, to a unified democratic nation with an advanced communications infrastructure and a solid industrial base.
 
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