Just ahead of the festive season, Japanese fast-fashion brand UNIQLO, owned by the $19.17-billion Fast Retailing Group, has set up its first retail store in New Delhi. The company expects to add two more stores shortly in the National Capital Region before expanding nationally.
The 35,000 sq. ft inaugural store, spreading over three floors of Ambience Mall in Vasant Kunj, opened this morning. However, the store is smaller than Zara’s flagship 51,300 sq. ft store overlooking the iconic Flora Fountain in South Mumbai and a shade smaller than H&M’s 37,000 sq. ft store in DLF Mall of India in Delhi.
“The opening of our first store, UNIQLO Ambience Mall Vasant Kunj, followed by a second and third store a little later represents a significant step in our company’s global strategy," Tadashi Yanai, founder and chairman, UNIQLO, and president and CEO, Fast Retailing said in a media statement.
Yanai, 70, launched the first UNIQLO store in Hiroshima in 1984 and today it has more than 2,200 stores in 24 markets across the world. As of August 2018, UNIQLO’s international business accounted for 51% of its sales, though the company has most stores in Japan. UNIQLO is one of the eight brands that includes GU, Theory and Comptoir des Cotonniers that Fast Retailing owns.
Commenting on the opening of the store, Yanai said, “Fast Retailing has long wished to open stores in India in view of the tremendous potential of such a large nation. We began recruiting here at the end of last year, and have been impressed by the exceptional talent, ambition, and diligence of the young people we encountered and welcomed aboard.” He added, “In the years ahead, we aim to enhance lifestyles in India by offering more innovative apparel that draws on the nation’s distinct culture and traditions.”
UNIQLO store carries a full line-up of LifeWear for men, women, kids, and babies. This includes iconic UNIQLO products such as the innovative and functional Ultra-Light Down (ULD) and HEATTECH garments, as well as products featuring premium fabric like denim, cashmere, Extra Fine Merino, and more. The range of apparels will feature pants for women starting at ₹1,490 (for leggings trousers) and T-shirts for men starting ₹490; formal men’s shirts were are priced between₹1,990 and ₹2,490. Its iconic ultra light down vest jackets start at₹3,490 and go up to ₹4,990.
Industry observers say that UNIQLO’s India foray is a bit late as its competitors like Zara and H&M have already established their businesses here. Zara opened shop in India in 2010, tying up with the Tata group in a joint venture, while H&M’s first shop opened in 2015 and it too came as a single brand retailer. Both these brands have close to 40 stores each. While Zara wants to increase its store count to 50 by 2020, H&M wants to add 50 more stores with an investment of Rs 700 crore by 2020.
The reasons are not difficult to see. India’s domestic market was estimated at $67 billion in 2017, which had grown at a compounded annual growth rate (CAGR) of 10% since 2005 and is further expected to grow at 11-12% CAGR and reach about $160 billion by 2025.
This will be an interesting space to watch as India heads to be a $5-trillion economy by 2025-26 and an increase in Indian’s per capita income to about $4,000, giving them the propensity to sell more. Global fashion has propelled Zara’s Amancio Ortega with a personal wealth of $62 billion, UNIQLO’s Yanai with $25 billion and H&M’s Stefan Persson with $18 billion as among the richest entrepreneurs in the world. India will surely play an important role in where their next billions come from.