Spencer's Retail is close to signing a franchise agreement with Beverly Hills Polo Club (BHPC), a US-based casual apparel brand.
KOLKATA: Spencer's Retail is close to signing a franchise agreement with Beverly Hills Polo Club (BHPC), a US-based casual apparel brand.
The agreement is slated to be signed on Friday in New Delhi. However, when asked, RPG Enterprises vice-chairman Sanjiv Goenka told DNA Money: "Can't comment."
But he did say that Spencer's Retail is close to signing a tie-up with "a US-based casual apparel brand."
Initially, the merchandise will be retailed from Spencer's hypermarkets in Delhi, followed by a national rollout. This will be followed by standalone BHPC stores across the country.
Goenka also said the merchandise will have "great price points".
An analyst told DNA Money that the tie-up is part of a larger blueprint to make apparels contribute 20% to Spencer's sales. Sources said that apparels' current contribution is over 6%, up from 4.5% in the previous year. A retail analyst said, "It makes sense for retailers to devote substantial floor area to apparels, since margins are higher in this category than in food items."
Apparels work on about 35% margin against 17-18% in grocery - that too, at the higher end of the spectrum. Spencer's has also signed a licensing deal with UK-based Ladybird, a mass apparel brand. Prior to this, the company retailed domestic kidswear brand Gini & Jony, which it buys and retails from its shelves.
BHPC, established in 1981, is one of the leading brands in the US, where sales exceed $500 million.
Apart from ready-to-wear for men, women and children, the brand offers a full range of luxury fashion accessories. The company currently has 90 licensees and 40 sub-licensees worldwide, operating in over 200 countries.
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