Incorporated in 2001, Tara Jewels is a leading fine jewellery manufacturer, exporter and retailer. It is also a public listed company since December 2012, of which Swarovski owns a stake through its affiliate Crystalon Finanz AG. Tara Jewels offers a wide range of products ranging from bridal to fashion jewellery with a database of over 50,000 designs that cater to a diverse audience in over 20 countries across five continents. Talking on the pertinent issues related to his brand and the organised jewellery market in India, Vikram Raizada, Executive Director and CEO – Retail, Tara Jewels, discusses with Indiaretailing.com about the future prospects of organised jewellery retailing in India and what role Tara Jewels will play in evolving this segment.
Please give a brief history of the company and profile, number of stores and cities in which they exist. How many footfalls do you get each month?
Tara Jewels has over 18 years of experience with leading international retail chains across countries like USA, UK, Europe (12 countries including Austria, Germany and Switzerland), Australia, China, South Africa, UAE and Canada. We initiate and own co-branded programs with various global retail chains.
Tara Jewellers – The domestic retail arm of Tara Jewels: After huge success in manufacturing and international retail, Tara entered the jewellery retail space in India in 2010 under the brand name, Tara Jewellers, an Indian brand with international appeal.
Tara Jewellers operates 40 company operated and company managed showrooms across 32 cities in North, Central and West India: Agra, Ahmednagar, Ajmer, Allahabad, Amritsar, Baroda, Bhatinda, Chandigarh, Dehradun, Gurgaon, Gwalior, Indore, Jabalpur, Jaipur, Jalandhar, Jalgaon , Jodhpur, Kanpur, Kolhapur, Lucknow, Ludhiana, Madgaon, Mumbai, Nagpur, New Delhi, Panjim, Pune, Raipur, Rajkot, Solapur, Udaipur and Varanasi. The total number of footfalls on an average per month is around 7,000 to 9,000.
How big is the market for the jewellery retailing category in India? What are the factors propelling the industry’s growth?
The size of the domestic jewellery business is estimated to be around US$ 30 bn. Currently, the unorganised sector holds 90 percent of the market, the other 10 percent being with the organised players. However, almost 80 percent of the business comprises of gold jewellery, with the balance comprising studded jewellery that includes diamond studded as well as gemstone studded jewellery.
The domestic jewellery market is set to cross US$ 40 bn by 2015, growing at a CAGR of 13 percent, on the back of improving lifestyle. The diamond jewellery segment looks very promising and is expected to touch US$ 6.41 bn in 2012. The segment has seen a tremendous surge in the last few years with growth rates in the range of 20 – 30 percent. Branded jewellery is another segment that is emerging as the fastest-growing segment in domestic sales and is expected to touch US$ 2.2 bn by 2012. With growing organised retail backed with concerted marketing campaigns, the future of the domestic jewellery industry shows enormous potential.
What is your market positioning and customer profile?
Tara Jewellers is positioned on the affordable luxury platform. In its launch campaign, Tara Jewellers projected itself as a friend, philosopher and guide to diamond jewellery. We provided confidence building programs and educated the customer about diamond jewellery, in order to empower customers to make a more informed purchase decision. The Tara woman is the quintessential contemporary Indian woman who is versatile, confident and proud of the life she leads. She could be the fashionable young and glamorous urban woman in the age bracket of 25 – 35 years old; or the 35-55 something trend-setting home maker, or the traditional mother-in-law-to-be. All these women have a common thread to Tara – they understand quality, the importance of high perceived value and above all, share an appreciation for beautifully crafted jewellery with international appeal.
Please provide details about collections, product range and services available at your stores.
A Tara Jewellers store displays a wide variety of Gold and Diamond jewellery catering to the quintessential contemporary Indian woman who is versatile, confident and proud of the life she leads.
We pride ourselves with great innovative product designs. Our jewellery designs are based on popular Indian motifs but with a unique international interpretation. Craftsmanship is at the heart of every piece of jewellery at Tara Jewellers and every offering emerges from a unique combination of technology, craftsmanship and passion for fine jewellery.
With a rich international experience in jewellery segment, Tara Jewellers has introduced to the Indian market collections that feature exquisite and unique jewellery pieces ranging from bridal, occasion to daily wear in diamonds, gold, polki and kundan jewellery; such as necklace sets, pendant sets, rings, bangles, earrings amongst others.
What is the location strategy for your stores – malls or high street? Which locations do you prefer? Are you also looking at shop-in-shops?
Tara Jewellers, based on a research by Third Eye Market Research, came up with a store format which is smart, scalable and sustainable. With a 1000 sq ft average area size, the stores are mostly located in jewellery clusters on high streets in 10 states and 32 cities.
Keeping in mind the shift in consumer demand, Tara Jewellers has also experimented with mall format and shop in shops. We have opened stores in malls in Mumbai and Delhi in malls like Phoenix Market City, Mumbai and Gold Souk, Gurgaon. In the year 2013, we also launched a shop in shop format store in Shoppers Stop, Inorbit Mall, Vashi, Mumbai with a twist. The 500 sq ft area store showroom has a complete see through glass facade that showcases the browse wall, collection wall, consultation table and open workshop; a visual treat for the shopaholics. It also features the unique servicers provided by Tara stores such as Karat meter, free cleaning and polishing.
What are the typical retailer margins in this business? How much time does it take for a store selling these products to break even?
The Gross Retail Margin is in our business is in the range of 20 percent – 25 percent. We generally achieve a break even at store level within first year of operations. Few of our new stores which were opened in the 2nd quarter of the last financial year are yet to reach the break even.
What is your expansion strategy to open more stores? Are you looking at other regions of India? Are you looking for franchise stores too?
We are currently in metros, mini metros, tier 1, tier 2 and tier 3 cities. From a macro perspective we first launched stores in West and Central India. Later we opened stores stores in North India in Delhi, Punjab and Uttar Pradesh. In future, we are looking at extending our retail footprint to Eastern India. The jewellery market of South India varies from the rest of India as designs and trends prevalent in the region are unique.
We are launching franchising this year, in tier 2 and tier 3 cities of India, as it provides not only an excellent opportunity for rapid expansion and better returns but also reaches out and connects to customers locally; simultaneously giving an insight to regional know how of jewellery industry.
What are your future product offerings and initiatives? How many stores do you open every year?
We are targeting to open approximately 5 – 10 new franchise stores this year. Although, we are receiving a lot of enquiries, the challenge here is to not only identify the right people but also associate with people having a long term vision and would like to grow with us.