feathers in the cap

From Rs 5 lakh to Rs 90 crore and now targeting the 500 crore mark - the Brothers Kapoor have come a long way in less than two decades. A profile by Ranjan Kaplish.
It was in 1989 when brothers Vipin Kapoor and Darpan Kapoor, basically in the construction business, were looking to diversify their family business and try their hands at something more challenging and promising. The business of fashion retail was beginning to show some signs of activity. And, with a sum of Rs 5 lakh and no prior experience of the industry, the duo plunged into it. The first store, named Playboy Fashionsport came up at a happening marketplace in Chandigarh . The store stocked everything – from formals to casuals, party to traditional wear. The right productline and product mix gradually made it the favourite shopping destination for the emerging fashion conscious generation.
Gradually, the small Playboy Fashionsport was transformed into today's 7,000 sq ft Kapsons. The duo was now a team of four – Vipin Kapoor and Darpan Kapoor along with their wives Dolly Kapoor and Nishi Kapoor. Vipin took charge of the merchandising and buying, Darpan handled the general administration and accounts. Dolly took care of the fashion and styling division while Nishi took on the vital role of customer care executive. “It was Nishi, whose ability to plan, execute and manage resulted in the phenomenal growth of the company. With allround expertise in business administration, banking, finance, trade and commerce, she created a strong foundation for the establishment to grow and prosper,” Vipin Kapoor, MD Kapsons Group, told IMAGES BoF.

Retail presence
Kapsons now claims a turnover of over Rs 90 crore, steadily growing at over 40 per cent. The group has similar retail formats in major towns of Punjab . Chandigarh being the capital of two states and a country leader in terms of human development index has the Kapsons' flagship store. At present it is in 7,000 sq ft and would soon expand to over 16,000 sq ft. The outlet claims around 3,000-4,000 footfalls a day, which is the highest as compared to the other Kapsons stores. “ Chandigarh has an organised and efficient governance. It is an ideal tourist destination as also the wealthiest town with highest per capita income. All these factors together make the Chandigarh store, the maximum business generator.” The city is also deemed as the next information technology hub, and also has the highest potential for growth which ensures that Chandigarh has that huge customer base and we only have to streamline it ,” said Vipin.
The Kapsons Chandigarh store in the Sector 17 Plaza is an open shopping precinct wherein one can buy anything from shoes, apparel, jewellery , fabrics, and is also the favourite window shopping destination of Chandigarhians. This shopping destination is at par with the Connaught Place in New Delhi with EBOs of brands like Tommy Hilfiger , Nautica, Esprit, Benetton, Dockers, Levi's, Reebok, Nike, Addidas, Pepe… The city with its central location and easy reach helps all the brands to penetrate in other regions like Himachal Pradesh, Jammu & Kashmir, Haryana and Punjab . The Kapsons' customer in Chandigarh is very choosy and prefers to buy clothes which are generally in fashion. People here buy almost all throughout the year but in very small quantities, which are 2-3 pieces of garment in a year. The choice is very basic in fashion and they do not pick either loud designs or colours.
The next city to see Kapsons was Amritsar . As there were no recognised multibrand stores and other shops were of 500-800 sq ft, Kapsons had an edge. The store spread across in 7,000 sq ft and moving on to 12, 000 sq ft attracted most of the NRI population in town, which has a huge buying potential and likes to splurge on apparel and luxury. The international airport and the Golden Temple attract a lot of tourists to the city. These travellers are also targeted by Kapsons. The store sees over 400 footfalls in a day. Amritsaris unlike Chandigarhians prefer fads than fashion. The customers likes to buy funky clothes in bold and loud colours.
After dressing up Amritsari NRIs, Kapsons moved on to cash on the wealthy population of Jalandhar, where through its biggest outlet of 12,000 sq ft, it caters to the needs of a young crowd from the state's leading colleges and universities. This store too is expanding and would soon spread up to 16,000 sq ft. The buying behaviour of customers of Jalandhar is similar to Chandigarhians. Around 600-700 Jhalandarites visit Kapsons daily for branded apparel with minimal highlights and basic and earthy tones.

From Rs 5 lakh to Rs 90 crore and now targeting the 500 crore mark - the Brothers Kapoor have come a long way in less than two decades. A profile by Ranjan Kaplish.
After Jalandhar, it was Ludhiana. Seeing success in all these cities, Kapsons kept going and also tried to sell fashion in the manufacturing hub itself. “Retailing in Ludhiana was difficult to start with as customers there do not have much of brand awareness and were used to the unorganised retailing and discount shopping. But within two years we have seen a good response from the visitors and sales are picking up well”. Kapsons Ludhiana in 3,000 sq ft witnesses around 400 footfalls daily. The customers in this city are very particular while shopping and would not buy anything that they can make out is produced locally. For instance, corduroys and tweeds are local products and so the store keeps a limited stock of the same.
Ludhiana has witnessed the change in the entire retail scenario. The city already has 11 malls while 22 more are expected to come up. An IMAGES & Confederation of Indian Industry Study depicts that over the years, the retail spending potential of Ludhiana is going to increase from Rs 3,864 crore in 2005 to Rs 5,940 crore by 2010, registering an increase by Rs 2,076 crore in the coming five years. In addition, the retail floor area demand is expected to rise by an additional 3.1 million square feet by 2010. Kapsons has miles to go in this city.
The group has big expansion plans in retailing. Looking at the potential of category stores, the company plans to open branded retail stores in the region for which it has already booked spaces in many upcoming malls and other shopping centres.
Visual merchandising
“Identifying the need of visual merchandising in today's retailing environment, a simple white box can no longer define excitement. It may be as simple as adding one bright colour to a wall or adding colour through product, but colour definition will always present excitement. Customers want to know that retailers have a clear point of view, that they honestly present their products and services and always give the best for what is spent. Often, these values are presented best through visuals”, says Kapoor. With due focus on visual merchandising, every Kapsons store adds bright colours and has theme-based window displays. The displays are always in tandem with the latest offerings and the festive seasons.
Customer loyalty
The Kapsons' customer falls in the Rs 20,000 per month income group. The population of Chandigarh is about 10 lakh while surrounding towns like Panchkula with three lakh people and Mohali which has a population of five lakh. In Amritsar and Ludhiana around 20 per cent and 30 per cent people fall in the same category. Ludhiana has over 40 per cent of the same income group and Kapsons is trying to tap on the same and has already made a loyal customer base in these towns.
Kapsons maintains a customer database with well defined profiles of those who have enrolled themselves in its loyalty programme called Royale Club. The club was started in 1999 and till date it has a membership of 3000 loyal customers from Chandigarh , Jalandhar, Amritsar and nearby areas.
The Royale Club offers an annual membership card to the customer that entitles them to various discounts and schemes at every Kapsons outlets. Apart from this, the cardholder gets a cake delivered at his/her place and also a 7.5 per cent discount on birthdays and anniversarys. The end-of-season sale invitations are also sent to the cardholders. The kids in the Royale Club fall in the Kapkids Brigade which indulges the kids in various activities to enhance their personality. The kids get to participate in various competitions and workshops arranged to help them shape up their hobbies. To have a regular interface with the club members, Kapsons publishes Kaleidoscope a quarterly fashion magazine. The magazine celebrated its first anniversary in October 2006.
The company spends only two per cent of its annual turnover for its promotions and also has a website in the making for direct customer interface. Plans to sell too are on the cards.
Back end: supply chain
The distribution network of Kapsons is being handled by its subsidy Kapsons Agencies. The agency manages the supply chain and deals with various suppliers and manufacturers. The agency also distributes leading brands to the various dealers of Chandigarh , Punjab , Haryana, Himachal Pradesh and Jammu & Kashmir. The list of brands under its distribution include Pepe, Freelook, Weekender, Tycoon, Tabachi, Shapes, Arrow, Puma, Toonworld, and many more. This entire network is controlled from a 12,000 sq ft office in Chandigarh . The hoard of all brands is stocked in a 4,500 sq ft godown here and is fed from here to the local as well as outstation outlets of Kapsons.
Commenting on the opportunities of fashion retailing in Punjab, Kapoor said, “I believe Punjab will be the biggest retail destination. The state by far would see all leading brands, be it domestic or international as also the chain stores, hypermarkets, super stores operating from here. The state has economic strength which will give a boost to organised retailing. The last three years has seen fashion brands growing at 40 per cent. This pace is expected to go up in the next five years. This huge potential needs to be tapped in Punjab."