‘Starbucks’ to enter India with Pantaloon owned JV

Starbucks, the world’s biggest coffee-shop chain with 12,440 stores worldwide, subject to government nod, is gearing up, to enter the country in partnership with New Horizon- a joint venture jointly owned by Kishore Biyani owned Pantaloon (49%) and V.P. Sharma (51%), reports Bloomberg. V.P.Sharma is the Head of PT Mitra Adiperkasa, Starbucks’ Indonesian franchisee, which operates 45 Starbucks outlets in Indonesia. We had earlier reported about the Starbucks’ possible tieup with Kishore Biyani owned Pantaloon.

Starbucks plans to open its first store in New Delhi and subsequently in Mumbai, the nation’s commercial capital, said Sharma. The first Starbucks store may go on stream by the year end.

Starbucks will have to compete with already established home grown Barista and Cafe Coffee Day coffee shop chains in India. By the year end, Barista is expanding its network of 100 shops to 225 shops.

People in most parts of India, except south, like to drink tea than coffee. Even, south Indians drink ground coffee. Preferences are, however, changing fast and increasing number of young Indians, especially students and upwardly mobile professionals, are favouring coffee shops as meeting and socialising places. About half of India’s population is less than 21 years old.

“It’s a status symbol to have a Starbucks cup in your hand in the countries like China and I think that’ll translate to India as well, as more Indians are working in professional jobs that give them more disposable income,” said Rick Drake, director of research at ABN Amro Asset Management, which among others manages Starbucks shares.

Louis Vuitton shops at international airports

Paris based, world’s largest luxury goods conglomerate, LVMH, constituted in 1987 by merging 102 years old, Louis Vuitton Malletier (“Louis Vuitton Trunk-Maker”) with the champagne producer Moët et Chandon and Hennessy, has been permitted by the FIPB to open duty free shops in India at Mumbai and Delhi international airports. These duty-free shops will be operated by DFS Venture Singapore- a LVMH subsidiary based in Singapore. LVMH is already present in the Indian retail sector having entered earlier through single brand FDI route.

LVMH will set up the airport shops by investing Rs 40.5 crore, divided between Delhi (18 crore) and Mumbai (22.5 crore). LVMH will build infra-structure facilities including warehouses. LVMH is also expected to offer quality merchandise at reasonable prices by leveraging on its sourcing network spread across the world.

Louis Vuitton’s signature leather goods are highly regarded in the fashion world and have created a cult-like following among consumers, who proudly display the logo and designs and refer to the products as “Louis.” The Louis Vuitton “monogram canvas” design, which was created in 1896 with the intent of preventing counterfeiting, is considered the very first designer label on a product in the world. Ironically, the Louis Vuitton brand has, however, become the most counterfeited brand in fashion history as more than 98% of all items branded with the Vuitton logo are counterfeit.

Unlike other less exclusive brands, Louis Vuitton products are sold only through Louis Vuitton boutiques in upmarket locations in wealthy cities and in concessions in other luxury goods shops like Harrods in London.

More global brands from VF stable

VF Arvind Brands, the 60:40 joint venture between, the US$ 6.4 billion VF Corporation, one of the world’s largest over 100 years old US based apparel companies, and Indian textile major Arvind group owned, Arvind Brands, is working towards bringing over 45 odd global VF, jeans and casual wear, brands in the country.

VF’s world famous Lee and Wrangler jean brands are already present in the country for over a decade, the company had earlier in 2006 had introduced VF’s super premium brands, JanSport, Kipling and Nautica.

Presently, the company is in the process of launching Hero and Riders brands owned by VF Corporation. These mid-price brands are planned to be sold through the multi-brand outlets and departmental stores. These brands offer a wide range of products including caps, shirts, T-shirts, belts, knit and woven tops.

While, the Riders brands is yet to be launched by the company, Hero brand has been introduced about a month ago through Metro C&C.

VF Arvind Brands, before bringing additional brands from the VF stable, will try to establish the existing brands in the current year. The company, however, is hopeful of introducing all of the VF brands in the country, in the next three to four years.

Arvind VF expects to clock a turnover of Rs 200 crore this year registering a healthy annual growth of 30%. It also expects to maintain this growth in coming years.