DLF brands ends Franchise Partnership with Alcott - Franchise Mart

DLF brands ends Franchise Partnership with Alcott

NEW DELHI India: DLF Brands, a DLF subsidiary that retails fashion brands in the country, has ended its agreement to sell Italian company Alcott’s collection, according to its managing director.

“We are shutting down Alcott as it is not performing too well in India,” DLF Brands managing director Timmy Sarna said, adding that the company has ended the franchise partnership started with Alcott in 2008. It is, however, unclear whether Alcott will now tie up with another Indian retailer. Alcott could not be reached for comment.

Alcott is among the foreign fashion brands that have had a mixed fortune in India. In 2011, Alcott’s senior executive Salvatore Colella had said that the brand was doing well and there were plans to convert the partnership with DLF into a joint venture. Last year, retail giant Esprit had exited the country after a nearly seven-year-long stint.

“Some brands are not able to survive in a competitive market such as India, and Alcott is one of them,” Sarna said.

DLF Brands, which had about 15 Alcott stores across the country, plans to shut down its last operational Alcott store, located in a south Delhi mall, later this month.

Alcott, according to its website, has an annual turnover of 120 million from its close to 180 stores in nine markets, including Spain, France, Georgia, Germany, Syria and Lebanon. The brand, owned by Capri SRL, was formed in 1988.

DLF Brands, however, is bullish on the domestic consumer market. It is expanding the remaining fashion and home decor labels in its portfolio, including Forever 21 and Kiko.

According to Sarna, the company will open 40 stores over the next one year with an investment of Rs 50 crore. With Italian cosmetics brand Kiko, the company is inking a 561:49 joint-venture agreement and plans to roll out 700-sq ft exclusive stores across the country.

DLF has also entered into a partnering with Los Angeles-based Forever 21 to sell the fashion retailer’s brands in the country. This follows Dubai-based conglomerate Sharaf Group closing its lone India franchisee store in New Delhi recently.

“We have already started opening new stores from July. The plan is to be present in metro cities as well as smaller destinations such as Surat, Baroda, Kochi, Jalandhar and Raipur,” said Sarna. “Even Mothercare, Claire’s and Sunglass Hut will see expansion.”

DLF Brands had a turnover of Rs 300 crore for the fiscal ended March 2012. Besides economic slowdown, which tends to affect sales of fashion labels, some experts attribute a brand’s failure in India to the local partner’s reluctance to pump in more money or choose the right locations for the stores.

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