Anita Dongre pursues sustainable growth with effective store management
22 July 2024, Mumbai
To chart a sustainable growth path, Mumbai-based fashion house Anita Dongre is focusing on profitability and strategic store management post-pandemic.
The operator of luxury brand Anita Dongre and other premium brands AND and Global Desi has closed some outlets to streamline operations, reducing its store count from 170 to 150. This includes 140 exclusive stores and 11 luxury couture stores. The closures occurred in cities like Lucknow and Raipur.
Since the last two years, the fashion house has been focusing on consolidation and profitability. It currently has fewer stores in some cities, and uses improved materials used in its clothing, says YashDongre, COO.
About two-thirds of the company’s Rs 500 crore revenue comes from the AND and Global Desi brands, with the rest from the luxury segment. Despite industry-wide demand challenges, the company targets similar revenue to last year, with ICRA forecasting revenue decline to Rs 500-550 crore in FY25 from Rs 606 crore in FY23 due to demand headwinds and inventory liquidation at discounts.
The fashion house also plans to expand its international operations. It currently has 11 Anita Dongre stores, including locations in New York and Dubai, and plans to open additional stores in these cities. The company aims to expand further into the Gulf Cooperation Council (GCC) region, targeting markets with a significant Indian diaspora.
In recent years, the fashion industry has made certain major investments including the stakes acquired by Aditya Birla Fashion and Retail (ABFRL) in Sabyasachi Mukherjee’s and TarunTahiliani’s fashion houses, and Reliance Brands acquiring a stake in Manish Malhotra’s MM Styles. Despite this trend, Dongreemphasises on their aim to remain majority owners in the fashion house.
The fashion industry saw rapid post-pandemic growth in 2022, followed by a sharp decline in 2023. The industry benefitted from ‘revenge buying in 2022, notes Dongre. However, demand dropped in 2023, leading to a discount-heavy FY24 due to excess stock. However, the fashion house aims to steer away from such discounts, addsDongre.
He believes, the company’s strategic focus on profitability, sustainable growth, and strategic expansion will help navigate the evolving retail landscape effectively.
