Giordano to wait, watch & then weave from India

CHENNAI: After dressing up people in almost 30 nations worldover, Hong-Kong-based retail giant Giordano is adopting the ‘wait-and-watch’ policy on outsourcing its products from India even as it has lined up plans for expanding its footprint in the country by opening about 20 stores by ’08.

“India is now the focus of every international retail chain because of its accelerating economic growth. While, we see good opportunity for ourselves in India, we want to first study the market closely before we take a decision on outsourcing,” Peter Lau, chairman and chief executive, Giordano International told ET in Chennai.

Observing that, “Textile infrastructure in India is yet to meet the global standards in terms of quality and scaleability of products compared to China,” he said the dragon land’s textile sector has been present in the global market since the last 25 years.

“Japan and Korea have invested heavily in the textile sector in China giving the sector an upward thrust. India, however, has not cooperated with the global investors, thereby losing out on the infrastructure need for its upliftment,” Mr Lau pointed out.

The apparel major, which opened its first store in Chennai recently at City Centre , is ‘bullish’ on its growth in India. It plans to open stores in Bangalore, Hyderabad, Mumbai and other major cities.

“Currently, we will concentrate on south India, the retail hub of the country, and then move on to other regions in a phased-manner,” he said, adding, “we want to test the market with our initial 20 shops and then may be scale it up to 150”.

On whether its pricing would be similar to that in the Middle East and Southeast Asian countries, Mr Lau noted that the prices may be marginally higher by 10-20% in India due to the high customs duties. “However, as far as possible we try to maintain the same price structure globally.”

He also noted that the Indian customers were aware of the brand because of the company’s strong presence in the nearby GCC, Australia and Asian markets.

“Giordano’s success is driven by its core values of quality, knowledge, innovation, service and simplicity and we will follow the same policies here to ensure consistency in quality and service,” he added.

The company, which closed the year with a turnover of ‘half-a-billion dollars’ has earmarked around $5m as its capex for its expansion plans in India. Started in 1981, Giordano currently operates in over 1,800 stores in more than 30 countries, including China, Japan, Singapore, Korea, Taiwan, Australia, the Middle East, eastern Europe and Central Asia.

The company also plans to open its first store in South Africa this year. Giordano Fashions India, based in Chennai, will be the country’s exclusive distributor for the brand and will house the latest collection besides the complete range of its core products.