Arvind brings America’s Gap to India

Plans to open about 40 franchise-operated Gap stores in five years; the first stores are expected to open in Mumbai and Delhi in mid-2015.

Sanjay Lalbhai, Chairman & Managing Director, Arvind Ltd along with J. Suresh, Manging Director & CEO, Arvind Lifestyle Brands Ltd at a press conference to announce Arvind tie up with Gap to bring American retail to india held in Mumbai on Friday. Photo: Paul Noronha

Arvind Lifestyle Brands, a subsidiary of Arvind, a leading integrated textile player, on Friday, announced a tie-up with Gap Inc. of the U.S. to open Gap stores in India. The first stores are expected to open in Mumbai and Delhi in mid-2015, and Gap will introduce its Summer 2015 collection for adults, kids and babies.

Arvind, under licence with Gap, plans to open about 40 franchise-operated Gap stores in India.

“We have a long and successful association with Gap as their vendor partner,” Sanjay Lalbhai, Chairman and Managing Director, Arvind, told a press conference. “We see the addition of Gap in our portfolio as a significant step to becoming the leading retailer in India.”

J. Suresh, Managing Director and CEO, Arvind Lifestyle, said consumers were ‘trading up’, and it was a Rs.1,000-crore segment where Arvind hoped to garner 90 per cent.”

Investment Arvind planned to open 40 stores in five years, each of 8,000-10,000 sq. ft., Mr. Suresh said adding that every store would entail an investment of around Rs.10 crore.

Arvind wants to dominate in three categories — mens wear, kids wear and innerwear. Of these, innerwear category size is Rs.18,000 crore, and Arvind has brands such as Hanes. “We have a huge opportunity to come close to the market leader in innerwear,” he said.

According to Mr. Lalbhai, a huge wave of growth is still to come in India’s apparel business which is today at around $40 billion with the biggest brand being worth around Rs.800 crore. “Some companies are poised to take a significant market share, and Arvind is one of them,’’ he said.

e-commerce Mr. Lalbhai said Arvind’s e-commerce venture, headed by his son, Kulin Lalbhai, “is not an extension of supply chain. We are trying to understand the space, and have an established supply chain in place so margins will not be affected. E-commerce offers a lot of price points, and does not suffer from the ills of brick and mortar businesses like being expensive or suffering losses due to dormancy.’’

Arvind has been a pioneer in bringing international brands to India and first brought Arrow to India in 1993. It has licensing arrangement with international brands such as Gant, Nautica, Izod, U.S. Polo Association, Elle, Ed Hardy and Hanes.