In an attempt to shrug off its ‘unaffordable tag’ among Indian consumers, UK-based retailer Marks & Spencer is consciously marking down prices.
“We want Indian customers to walk in and be surprised at our range and pricing,” Mr Mark Ashman, CEO, Marks and Spencer Reliance India, told Business Line.
Marks & Spencer, which entered India about five years ago, is repositioning itself as a mid-market player — a shift from the ‘premium’ perception it has acquired in India.
The retail brand has lowered its entry price points in almost every category since the Spring-Summer season this year.
“We have cut prices and we can go farther. We want to expand the customer base in every category. We want to be a high-volume, low-margin player here,” said Mr Ashman.
India is also the first country that M&S has looked at to bring in a price change.
As part of the markdown drive, M&S has slashed its prices by almost 20 per cent since last year. Women’s polo T-shirts are now sold for Rs 395, down from Rs 495 last year, while men’s formal shirts are priced at Rs 695 (Rs 795 last year).
To offset the narrow margins that price cuts entail coupled with high import duty on branded apparel, M&S is planning to increase its sourcing from India and Bangladesh to 70 per cent in four years, from 35 per cent now. “All our savings in India would go towards lowering prices,” he said.
Marks & Spencer partnered with Reliance Retail last year to increase its presence in India. It currently has four large stores (15,000 sq. ft.) and ten smaller franchisee stores (4,000 sq. ft.). The retailer plans to increase the number of large stores to 50 in four years. The expansion plans also include bringing in a wider product range – children’s apparel and homeware.
Source: The Hindu Business Line