Swiss luxury watch maker Raymond Weil is keen on setting up its own shops in India if 100% foreign direct investment (FDI) in single-brand retail is allowed in the country without the mandatory sourcing norm of 30% from local vendors.
While the company foresees it happening soon with the Narendra Modi government at the helm, the family-owned independent watch-maker, however, will seek the existing local franchisee partners? views in the event of the company floating its own retail outlets.
Currently, the company has a fully-owned subsidiary in India called Raymond Weil India Distribution, established in 2010, mainly for expanding its India presence with point of sales and exclusive boutiques that are run in partnership with local franchises.
The Union government had in 2012, while allowing FDI up to 100% in single brand retail, stipulated mandatory sourcing of at least 30% of the total value of the products from Indian small industries, village and cottage industries, artisans and craftsmen.
“We are a Swiss watch-maker and there is no scope for local sourcing as our entire brand image hinges on Swiss technology and quality. We are ready for our own shops if the Modi government brings in FDI in retail without 30% sourcing norm,? Oliver Bernheim, global president & CEO, Raymond Weil told FE.
In an exclusive chat with FE, Bernheim said the Indian market represented a huge path for company’s business aspirations with the highest rate of brand recognition. The watchmaker had opened its first exclusive Raymond Weil boutique in Delhi, followed by Chennai, with shops in shops in Hyderabad and Pune, earlier this year.
Referring to the taking over of Modi government, he said: ?whatever has happened since May this year is probably the kick that will take the country to another level of growth. If everything works out and the implementation takes place nicely for opening up of single brand retail without any riders, we are ready to take up the FDI route.?
However, he added that the company would like to have discussions with existing local franchisee partners to seek whether they would want go along with the company.
“We are a faithful company and would prefer local partners with whom we had associations in the past 40 years,? he said.
The luxury watchmaker, which sells watches in the range of Rs 80,000 to Rs 5 lakh in India, said there was huge market potential lying untapped.
“Now, we are planning to expand our customer base and accordingly adding outlets even in smaller cities like Patna, Coimbatore and Kochi, ? he said.
The company, which sells close to 2 lakh watches globally, will be bringing to India a ‘cheaper’ brand from its stable by this year end. Called 88 Rue Du Rhone, the brand will have products ranging from Rs 40, 000 to below 1 lakh.
?We are planning to launch the brand in India between Diwali and Christmas. This brand has already been launched in markets like the US, UK and Australia,? he said.
He said that the company will be adding 25% new products to its portfolio every year and will be strengthening its manufacturing capabilities as well.