Luxury retail, which was a promising sector a few years ago, seems to be in deep waters as more and more brands seek new partners or are shutting down stores.
Iconic luxury brands Versace and Cavalli, which were previously run in India by pan masala barons of the Chaurasia Group that owns Infinite Luxury Brands, are seeking new partners.
The Delhi-based Bequest Group, which runs Berluti, Tod’s and Saint Lauren, is said to be in the running for Cavalli.
Notably, both Cavalli and Versace have a store each in Delhi’s DLF Emporio Mall.
Some others are closing down their stores! One such brand is the French bridge-to-luxury brand Longchamp, which has shut down 4 of its stores in India. Back in 2016, the brand had planned to have 6 stores.
TM Lewin is in no different situation, as it too is in the process of shutting down its stores in the country.
Radha Kapoor Khanna, Founder, DOIT said, “We are reviewing our portfolio of brands and individual stores. We will continue to operate brands and stores that are generating targeted revenues and margins.”
High operating costs, fast increasing rentals and around 25 per cent reduction in footfalls are the major reasons for the poor situation the luxury brands are finding themselves in.
According to registrar of companies data from Tofler, Infinite Luxury reported a net profit of Rs. 2.9 crore in FY18 versus a net loss of Rs. 13.8 crore in FY17, while DOIT Creations clocked a net loss of Rs. 9.95 crore in 2018 versus Rs. 7.7 crore the year before.
DOIT Retail recorded a net loss of Rs. 7.26 crore in 2018 versus Rs. 3.43 crore FY17.