Noida-based Footwear retailer Vi-Ga recently announced its maiden foray into market outside India. The company’s first overseas store is to be operational in Nepal in February this year. IndiaRetailing traps Vi-Ga CEO, Vinayak Mahtani in a Q&A session. Excerpts.
IndiaRetailing: Vi-Ga is all set to go abroad. Your comments.
Vinayak Mahtani: The company will make its maiden entry abroad with the first store in Kathmandu. The store, to be operational in the capital city of Nepal this February, will be spread across a retail space of 3,000 square feet. The outlet in Kathmandu will be based on the franchisee model in partnership with the local players.
IR: How much investment have you put into the store?
VM: We are in the process of finalising quantum of investment for the store.
IR: Do you have plans to for more such expansions?
VM: We are talking with companies in the Middle East and gulf region. Earlier, we planned to get it done by this year-end. Unfortunately we could not as the regions are among the major victims of on going global crisis. However, we are hopeful of our foray in these markets soon.
IR: With just 10 stores of Vi-Ga operational in north India, it looks quite early to move abroad before you could strengthen company’s presence in unexplored rest of India market…
VM: In India, real-estate rentals have hardly gone down. Good real estate properties are still charging heavy prices today. When one looks at an overseas market like Nepal, besides rental being cheaper there, the market has huge potential which ultimately gives us an opportunity to explore it.
IR: How do you see the footwear industry in India?
VM: Despite having huge potential, Indian footwear industry has a lot to do before it matures It’s a very unorganised sector currently. Today there is a huge amount of western influence in the Indian fashion and large amount of Indian impact on western fashion. Hence, the individual concept of East and the West has diminished, which is working as a catalyst for the Indian market.
IR: How do you find the Indian consumers in terms of footwear industry—brand conscious, value conscious, or price conscious?
VM: Ladies are very style conscious. Price is a very big factor for them but they look at the product first. For men, brand is most important. Price is not a factor with men, but yes, they look for elegance.
IR: Has the economic slowdown affected the footwear industry?
VM: Yes the slowdown has affected the industry; customers want more for their money today. Companies which offer an unbeatable service and a reliable, value for money product such as ours, will not be as affected.
IR: What is the USP of your shoes?
VM: We are the only company in the country that offers 15 days money back, which means if you do not like the pair of footwear, we will refund your money. We also offer three-month warranty. In case, we could not repair damaged shoes, we replace it. We also offer a life time warranty on our shoes, at no extra charge, with the promise that bring it back after as many years we will repair the shoe can give back.
IR: Who are your target customers?
VM: The middle class, the growing segment of India, persons working in BPOs, IT, small business owners.
IR: Why not the bottom of pyramid (BOP) consumers?
VM: We will have a model for them in future. However until the inflated occupancy costs by both malls and markets does not decrease we will not be able to roll this out.
IR: You have made collaboration with local retailers in Nepal. Any plan to make such collaboration with local retailers or show makers in India?
VM: It depends on the partner….if we find a partner for a region in India who’s philosophy of the brand is the same as ours we will be open to the idea.
IR: Do you see large-scale consolidation taking place in the industry?
VM: It has already started with a number of footwear retail chains already existing. But when it comes to professionalism, I believe, the local retailer, the cobblers and many such score more points of professionalism. Companies like Vi-Ga spend millions of rupees in CRM activity and still we don’t know who our customers are, individually. But these small-scale business owners not just know the names of their consumers but also their need. We need to learn a lot from them.
IR: How has been your sales graph in India?
VM: 100 per cent growth since we have opened three and a half years ago.
IR: What are your expansion plans?
VM: We have been the only company in India which has not come out in the press with huge expansion plans, we believe in a steady and solid growth. Our primary aim is to ensure our business model can sustain all kinds of economic situation such as the one we are in now. Growth will follow by itself. We are not too concerned with number of stores but rather the number of satisfied customers, currently we have created a lead position in the North of India.