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Giant brands lead growth while small brands struggle

"CMAI’s Apparel Index for Q4 Jan-Mar FY 2017-18 indicates a growth recovery at 2.88 points. All the three sized brands termed as Big brands (Mid, Large and Giant) together recorded a growth of 7.61 points. Amongst these, Giant brands, with an impressive growth at 10.00 points led the way. While mid and large brands too were not far behind with growth of 6.26 and 8.50 points. Small brands, however, at 0.75 points, seem to be struggling for growth, indicating the gravity of recession pushing down these smaller players, who are not in a good position to outsmart their business practices, just yet."

 

Apparel Index Graph 2CMAI’s Apparel Index for Q4 Jan-Mar FY 2017-18 indicates a growth recovery at 2.88 points. All the three sized brands termed as Big brands (Mid, Large and Giant) together recorded a growth of 7.61 points. Amongst these, Giant brands, with an impressive growth at 10.00 points led the way. While mid and large brands too were not far behind with growth of 6.26 and 8.50 points. Small brands, however, at 0.75 points, seem to be struggling for growth, indicating the gravity of recession pushing down these smaller players, who are not in a good position to outsmart their business practices, just yet.

Commenting on scenario, Satyen Momaya, CEO, Celio, that is one of the Large brands avers, “Stronger GDP growth rates in the last quarter and the current fiscal year have translated into handsome growth for discretionary categories such as apparel”. Talking on the similar optimism underling their product line, Neha Shah, Marketing Head, Pepe Jeans India says, “The denim industry has witnessed a slow and gradual growth over the last few years. However Pepe Jeans has witnessed a steady growth in the last couple of years by expanding into online channels and omnichannel retailing.

A comparison between Small and Big Brands index value 0.75 and 7.61 respectively, indicates a very big gap inApparel Index Graph 1 the growth performance. The biggest gap is in Sales Turnover. Big Brands increased their Sales Turnover to 4.90 points, against insignificant growth of 0.12 points for Small Brands.

Increase in Sales Turnover

Sales turnover in Q4 reflected an index growth of 1.6 points. Nearly, 54 per cent brands reported an increase in sales this quarter. Giant and Large Brands, which grew at 14.3 per cent each. “The reason for an increase in our sales turnover was , we focused on increasing and streamlining our product line by categorizing production to increase productivity, explains Blazo’s owner Niyam.

Improvement in Sell Through

Nearly 54 per cent of the brands reported an improvement in their Sell Through in this quarter, while for 40 per cent brands the Sell Through remained the same, and around 6 per cent brands recorded a dip. In order to manage better growth and performance brands have been maneuvering their business, as Radhesh Kagzi, President, Creative Lifestyles Pvt. Ltd says, “We have reduced our quantities per style and done ISTs for goods. This has resulted in better Sell Through and reduced Inventory Holding/investment.

Inventory Holding: Inventory Holdings for almost 45 per cent

 
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