Contemporary ethnic wear firm TCNS Clothing, which owns the brands W and Aurelia, is planning to make their Indo-Western brand W a lifestyle brand by extending categories and keeping their focus right on quality and fit of the products.
Founded by O.S. Pasricha and A.S. Pasricha, the firm introduced the W brand in 2001. It currently contributes about 70 per cent of their overall revenue, while ethnic brand Aurelia and premium brand Wishful contributes the rest.
“In the past, we have successfully added jewellery as a category under the W brand. We are now adding bags and we might very soon come up with footwear. Looking at the pace at which the brand is growing – both geographically and monetarily – it won’t be long before it gets turned into a complete lifestyle brand, of course keeping our core competencies intact,” Chief executive officer, TCNS, Anant Daga said in an interview with Indiaretailing Bureau.
The plans are also afoot to make their premium brand Wishful (priced between Rs 2,999-7,999) as a standalone brand. It is currently sold as a private label at most of the W outlets.
“In the next two years, you will see Wishful going the independent brand way rather than just being a label. We might come up with stand-alone stores as well but are still figuring out the supply chain, design, and another bottleneck. But wishful stores are a reality which will be implemented soon,” Daga said.
While the company in August this year had scooped up $140 million in funding from US-based private equity firm TA Associates to fund its growth plans and provide an exit to its existing investor Matrix Partners India, Daga said it was a secondary deal and the company didn’t get any money directly.
“It was a secondary deal as Matrix had exited completely. We as a company, does not need cash as we are cash-positive and debt-free,” said Daga.
TCNS’s Growth Curve
Founded in 2002, TCNS Clothing entered retailing by setting up its first store in Delhi – catering to women in the 27-35 age group.
Today the company, has grown into 375 outlets in 100 cities across India, and takes pride in the fit and quality of the clothes and sees no threat from the competition popping up in the market.
“I think, there is hardly any well-entrenched ethnic wear brand in the market. If you talk about brands, then there are just five or six, rest are just small labels who are either channel specific or customer specific and most of them are discounted and me-too- copycats,” said Daga.
“Moreover, competition, if any, is only for those (brands) who play around pricing and don’t have any distinct product to offer. We as TCNS has always differentiated between the pricing, approach, and clientele of our product which has helped us to grow in the market,” he added.
Currently, W is sold in around 250 exclusive outlets while Aurelia is sold through 125 stores and both the brand has their own strengths in terms of marketing positioning. Where brand W, has a more fusion appeal, Aurelia is an entirely ethnic brand, priced between Rs 599 to Rs 3,299 range. Premium brand Wishful, is priced a bit higher (Rs 2,999-7,999) and is currently sold within W stores.
In addition to giving a distinct look, Daga said companies agility to change and evolve with the consumers changing needs has also ushered its growth.
“Over the years, we have realized that the traditional definition of ethnic wear is undergoing a sea-change. And this compartmentalization of fashion – on the basis of ethnic or western wear- is only limited to brand’s point of view. Consumers have stopped looking them under two different lens,” said Daga.
“In fact, we have stopped calling W an ethnic wear brand a long time ago, we call it a fusion wear brand. And now, this transition as a lifestyle brand by adding multiple categories is a part of this long-term goal,” he added.
According to data from the firm’s filings with the registrar of companies (RoC), TCNS Clothing’s 2014-15 revenue jumped 80% to Rs.358.7 crore from Rs.199 crore in the previous year. The firm’s profit tripled to Rs.27.2 crore.
Online Foray & Global Expansion
The company has also jumped on the e-commerce bandwagon with both its own e-commerce website and selling on partners website.
While the current contribution, is less than 10 percent, Daga said it will emerge as an important channel, going ahead.
“Today as a retailer we have no right to dictate which channel should we sell our goods on. It’s up to consumers. We just have to think about how to build a convergence between these two channels. Additionally, online as a channel has also given us an advantage of reaching to the consumers where we do not have a physical presence. If consumers in these cities know us before we reach them, it’s only because of the e-commerce.” noted Dagga.
Meanwhile, the company also entered few International markets, including Mauritius, Nepal and Sri Lanka – opening one store each- to tap Indian diaspora. The plans are afoot to enter the Middle East markets soon.
“Our pilot in these markets have been phenomenal. Within the first 12-18 months of operations, we are moving from one store outfit to four and even five stores, in all the geographies,” said Dagga.
“We are also in advanced stages of talks to open our outlets in the Middle East. However, so far, we have not been able to decide the modality of the business and that’s where we are stuck currently,” he concluded.
(Interview conducted by Mehak Sharma for Indiaretailing Bureau)