Home textile exporter to enter domestic retailing

The exploding Indian retail mart seems to be attracting new players. Now, a Tamil Nadu-based firm "� Sabare International Ltd "� engaged in production and export of home furnishing textiles, has decided to take a plunge into the domestic retailing business.

The 15-year-old company will commence its retail operations one year from now. Initially, it will target metropolitan cities and move to tier-II cities subsequently. The firm will focus on home solutions "� furnishings, crockery, appliances and all basic lifestyle needs.

"Barring grocery, all other merchandise required by households will be sold through the retail chain. The initial investment will be Rs 70 crore, which will he scaled up for expansion. We will target the middle-class customers. The retail operations will be rolled out during early 2008," Sabare chief founder S Susindran told Business Standard.

While 50 per cent of the products (home textiles) will be produced in-house, others like crockery and furniture will be sourced from elsewhere.

"Since we have already developed a model called "� Total Retail Solutions Provider (TRSP), integrating production and supply chain management "� for our customers, it is easy for us to enter the domestic retailing segment. Besides, the Indian retail market is witnessing dramatic growth. These factors prompted us to enter the retail segment," he stated.

According to market analysts, though the retail industry in India is fragmented at present, the retail market is expected to grow to about $430 billion in the next five years.

"Organised retailing accounts for only 3.2 per cent of the total retail market. But it is estimated to grow at a rate of 25 per cent to 30 per cent per annum. The retail industry is poised for a rapid transformation," pointed out Preeti Reddy, vice-president, KSA Technopak, a business consultancy firm.

Sabare specialises in window curtains, decorative pillows, bed pillows, quilted bedding, sheet sets, duvets, pillows, bath, shower curtains, bath rugs, floor coverings, rugs, sofa covers, table cloth & napkin, chair pad, towels, kitchen rug and chair covers.

"We have a whole range of products that can be of great interest to middle-class families. These are the same products that we supply to international brands worldwide," Susindran stated.

Sabare, founded in 1991, has a large integrated manufacturing facility at its headquarters in Karur. The company also has its marketing and manufacturing facilities in other locations like Noida (Uttar Pradesh) and Panipat (Haryana). It is investing Rs 150 crore in all the three locations to increase production.

"We are in a good position to supply merchandise to our outlets are all over the country as the factories are located at important centres," he said.

The company is engaged in supplying home textile solutions to retailers in the US, UK, Spain, Italy Germany, Canada, Australia, the Netherlands and Japan. Sabare achieved a consolidated Rs 340 crore of annual sales in 2005-06 and is expected to grow to Rs 500 crore by 2008.