Japanese sportswear brand Asics has drawn up plans to increase local sourcing to 30% over the next two years, paving the way for opening its first own retail store in the country.
“Right now we have 64 exclusive retail brands operated by franchisees in different parts of the country. In order to open our own retail business, we should source 30% of the raw materials locally. We’re taking it step by step,” said Rajat Khurana, MD, India and South Asia.
Asics, which follows the calendar year for its operations, sources 25% of its needs locally, for both footwear and apparel. The Company plans to increase local sourcing to 27-28% in CY22 and to reach 30% by CY23.
“Most of our branches are in the north, followed by the west and south. We will open our own retail stores once we reach the 30% local sourcing requirement. The number of stores, size, cities and investments will vary from state to state,” he said.
Mr Khurana said having a dedicated outlet has its own advantages, such as plenty of space and the ability to display a wide variety of products in a confined space compared to the multi-brand retail stores with less visibility.
In the current year, Asics plans to open 15 stores, 25% of them in the south. South currently has 14 branches – seven in Bengaluru, three each in Chennai and Hyderabad and one in Kochi.
He claimed that the South is an important strategic market for Asics and said he will continue to bring customers the latest offerings.
Asics saw 30% growth over the same period last year in CY20, and about 35% of that came from online sales. “After the second wave of the pandemic, consumer sentiment has improved and they have become health conscious. Our sales volume is also increasing,” he said.
When asked about the rising cost of raw materials, he said Asics has not passed them on to customers, which has impacted profits.
On the subject of semiconductor shortages and container congestion, he said this has caused a slight delay in production, but it can be managed.
Asics brand athlete squash player Joshna Chinappa recently unveiled the Lite Show collection in Chennai. The new collection offers 360-degree visibility when running in low-light conditions, helping runners feel safe and confident, the company says.
