US-based apparel retailer GAP Inc., which currently operates 11 stores across India, plans to open four more stores by the year-end. It has also decided to manufacture and sell locally in the country to compete with rising competition from its European rivals Zara and H&M.
Once the fashion brand will start manufacturing its clothes here it will have an impact on products prices. The retailer has framed a strategy to up the ante further. It has also decided to minimize its stores size from current around 9,000 square feet to about 5,000 square feet. To push its digital sale, the retailer has also made a partnership with online retail giant Amazon.
“We had a very good start. But there was a new duty introduced by Government in 2016 on imported products, which increased the cost model of GAP,” said J Suresh, MD and CEO at Arvind Lifestyle Brands and Arvind Retail, which runs JVs or franchisees of top global brands including, Gant, GAP and Ed Hardy and Aeropostale.
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“H&M and Zara forayed into Indian market with low prices to woo the customers. Going forward, we will correct prices by 10-15% because we have got approvals to manufacture in India and therefore won’t be required to pay import duties,” he added.
Earlier, although India has been a strong sourcing hub for GAP for its global markets, it did not have the necessary approvals to sell the same products here.
