Numero Uno had a tough 2016-17, and it does not want an encore this fiscal. To avoid another dull year, the apparel brand is investing in areas such as store enhancement and renovation in order to attract customers and provide them with an experience like no other.
For the brand, 2016-17 was tough due to the government’s demonetisation move. “It came at a time when the autumn/winter season sales for north India had just begun, and that completely took the air out of the bag,” said Narinder Singh, chairman and managing director, Numero Uno Clothing Ltd.
The government’s move slashed the revenue target of the brand by 15 per cent. “As consumers don’t shop for autumn/winter clothes post-January, it did impact us financially,” Singh said.
The revenue target for FY16-17 stood at Rs.325 crore and the company is eyeing for a 20 per cent (approximately Rs.389 crore) increase in that figure for FY18.
Excluding the three months of demonetisation, the year was pretty ordinary for Numero Uno. Now, customers are coming back and are not only looking for discounts, but also experience and quality products.
Singh feels the customer’s confidence is back, “as long as nothing new happens which will impact them financially and we are unable to control it”.
When asked if GST will play a role, Singh said, “We are not sure (what is in the mind of the government). GST is coming along and nothing is clear under what bracket apparels fall and how much it will impact us in terms of pricing. I feel it will have a positive impact.”
Expansion in non-metrosCurrently, the apparel brand has 210 stores across the country and 50 per cent of them are in Tier I and Tier II cities. The plan is to add 30 more stores within the next financial year.
After establishing its presence in the north India, Numero Uno plans to consolidate its presence in the west, south and north-east regions.
Establishing the brand in new markets and exporting the products is one of the priorities for Numero Uno this year. Talks are going on with different partners to enter markets in UAE, New Zealand and Australia.
Online complements offlineCurrently, Numero Uno’s 15 per cent sales come from online trade. The brand has differentiated their product offerings between online and offline platforms, so that even if online players offer a discount, it will be on a particular product which is not available offline but still sells under the same brand.
The brand has created a special line of products for the online space in order to not compete with the online discount offerings and which will not affect their offline stores as well.
When asked if he is not bullish about online sales, Singh replied, “Yes, we are. But the only thing is we need to see to it that a customer should be willing to buy at MRP and not just on discount.”
The company also plans to double their online sales by up to 30 per cent in 2017-18.
IPO and upcoming productsNumero Uno was all set to raise an IPO for $10 million in 2015. The plan didn’t work. “Market experts suggested the brand will not be able to get the exact market value and it should wait for few more years,” he said.
Currently, it has no plans to raise an IPO for at least 3 more years. “It’s very draining for the company, and one has to put efforts for at least one year,” Singh added.
Apart from the expansion plan, Singh’s core focus area is to introduce a special denim shoe line. The brand will treat denim jeans and shoes at par. In the last two years, the brand has not seen a decent growth in their shoe segment but this time it has caught the consumer’s attention.
“Shoes are very close to me as a product. We will do a fair amount of business this year in that,” Singh signed off.
BW Reporters
The author is a journalist with BW Businessworld. He primarily covers Retail, Media & Entertainment and Travel & Tourism sectors
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