Hard to believe, but true: small town, big pocket
Aug 19 2013
I am not the only one who has realises this unusual fact as there are a lot of designers who are planning to open their standalone stores in some of these cities. Even during fashion week, we have buyers who run multi-designer stores form cities such as Raipur, Amritsar, Nagpur, Kanpur, Nasik and Indore, among others. Understanding the logic of this growth is not so tough since one knows the escalation of land prices in the past decade, which made a lot of these places with good connectivity to metros, in demand for setting up industries and SEZs. There have been tycoons in these places like tea estate owners in Guwahati, steel barons in Raipur and coal mine owners in Dhanbad, among others. These families have huge disposable incomes and the exposure in the youth, thanks to social media and information available on internet today has made the scenario favourable. They also want to have the best luxurious items available in the country — be it cars, clothes, accessories et al.
According to a survey, 12 per cent of India’s affluent class lives in these cities. Apart from designers, even retail stores are expanding in these cities so much so that some brands are only expanding more in tier II and tier III cities. The attractive part for them is that the luxury market in the west is getting stagnant, so international brands are eyeing emerging markets such as India and China since the past five years. After making their presence felt in metros, they saw potential in tier II and tier III cities as well. Among a lot of factors that encouraged them to make this decision, rental value of stores in these cities are quite less compared with metros. The cost of manpower is also less, even though the quality is still an issue. Above all, the mall culture, which is spreading in these cities as well, is making it more sensible to expand. These factors make these cities hotspots, as the MRPs are same.
Yes, it is true that achieving break even in these cities takes time, but if one sees the bigger picture, then all the reds on the balance sheet will turn green in no time.
(The writer is a Delhi-based fashion designer)