Reliance Brands may propel Adidas retail

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Reliance Brands may propel Adidas retail

Post  Anand on Fri Aug 15, 2008 6:28 pm

BANGALORE: Adidas may bank on Reliance Brands, a subsidiary of Reliance Retail, for expanding its store network in the country. Reliance Brands is in discussions with Adidas to pick up store franchisee rights.
Sources said Reliance has pitched in to accelerate store development plans of Adidas. Reliance Brands and its parent, Reliance Retail, till now have stayed focused on striking equity joint venture or exclusive licensing deals to launch lifestyle brands in India.

But the move with Adidas is a pure distribution play, which is considered the single biggest challenge for the global lifestyle companies. There are just a few independent distribution companies focused on the lifestyle sector, with Aryan Lifestyle, part of Emaar MGF, and Primus being the prominent ones. These entities primarily pick up store franchisee rights for global brands operating in India, and the entry of Reliance into this space is significant, industry observers added.

“We are in discussions with several potential partners for franchisee operations and Reliance is one of them. We have very aggressive expansion plans and they can not be executed by one company alone,” Adidas India managing director Andreas Gellner told ET.

Mr Gellner said it will continue to operate with existing francisee partners like Primus in propelling the growth engine. “India’s fashion industry is singularly challenged by distribution (capabilities), and not by demand and supply challenges,” an industry source explained.

Adidas has around 330 stores at present and plans to open 100 more within a year, as it charts forays into smaller towns. The global giant saw its domestic business jump 30% in the first six months of the calender year.

Anand

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