Ebony Gautier, a five-year-old master franchisee of Gautier, the French furniture major, has planned to expand its retail business in this country.
This comes at a time when Swedish furniture giant Ikea is preparing to enter India. Positioning itself as a premium-end furniture brand, Ebony Gautier says it rules out any competition with Ikea.
“Ikea is not a competitor, as it is at the entry level. Its products are more for young couples setting up their first house. We are not into mass produce; our production levels are not as heavy as Ikea. Both price points and design elements are different, too,” according to Abhijeet Mitra, chief executive officer of Ebony Gautier.
Yet, says David Soulard, chief executive, Gautier, the good thing is that Ikea could help create an attraction for contemporary furniture in people's minds.
Fully owned by Ebony Homes, the home furniture arm of DS Constructions, Ebony Gautier has six stores across Noida, Gurgaon, Bangalore, Chennai, Hyderabad and Faridabad. “We are looking at eight to nine stores before this financial year is over and at another four to five during the next year, subject to availability of the right place at the right rental,” said Mitra.
Saying the company was not in a hurry to have 20, 30 or 40 stores, Mitra said, “We would look into the profitability and viability of the store and a core market which we can service and support.” The company is likely to open stores in Mumbai and Amritsar; it is also evaluating locations in Pune, Lucknow, Jaipur and Kolkata. These could spread across 7,000 to 11,000 sq ft.
With an average annual growth of 43-44 per cent, the company would not reveal its current revenue nut said it was targeting this to be close to Rs 100 crore in revenue in two years. It wants to set up a manufacturing facility but before doign so, the volume of business must increase significantly, said Mitra.
The company’s entire collection is imported from Gautier in France. The group needs to sell furniture worth Rs 7 crore a day to its partner shops, Soulard told Business Standard in an email reply. “We have a frame of 80 shops worldwide, based on the franchise system,” he said.
On the effect of the Euro zone crisis on Gautier’s retail business in European countries, Soulard said, “We shut our shops in Greece last year but for the rest of them, we were not so much affected by the Euro zone crisis. We still grow the sales in our first shops. We grow in a market which is declining.”
Although single-brand retail chains are allowed to bring in up to 100 per cent foreign direct investment, neither Gautier or Ebony spoke of any standalone plans. Mitra said, “Gautier is very strong in manufacturing and they want to stick to their core area, while we understand the Indian market and the customer preferences…It’s a good relationship that has been working well for the past five years.”