Retailers may take Brand India abroad

Local firms allowed to sell products under own brand names

The 'Made In India' tag is now gaining acceptability in international markets. Global retail chains sourcing from India are offering the option to local companies to sell products under their own brandnames, and are also offering assistance in registering Indian brands in the US.

In these tie-ups, Indian companies, which enter into licence agreements with multinationals for selling abroad, are likely to be preferred during procurement.

Merchandisers with international retail majors scouting for tie-ups in India said while they had confined themselves to open sourcing agreements so far, they would prefer companies that had licence arrangements with MNCs.

The new trend spells good news for companies like VIP, which are in talks with retail chains like Target Corporation. "India has been nearly absent in the international market in the luggage segment. We are talking to them but VIP is likely to retain its brand name as part of the deal," a source close to the negotiations said.

A merchandiser said overseas retailers were also offering help to Indian firms in registering new brands in foreign markets like the US. "It does not make much sense for the known Indian brands, but for smaller producers, who are equally cost-competitive, it is a good option," he said.

Speaking about the advantage of tie-ups, an executive with a retailer, which is looking to place orders for soaps and toiletries in India, said for such products there were only open sourcing deals so far.

As per the existing practice, the retailer gets the consignment packed by an Indian vendor along with its labeling under the retailer's brand. "But if an Indian company has a licence agreement with, say, P&G, then we will prefer such deals because we get the benefits of cheaper cost plus the international brand," he said.

Companies like La Salle, a Kanpur-based leather good manufacturer, has tied up with Samsonite to supply portfolio bags under the foreign company's brand name.

In product segments like garden equipment and accessories also, where there has been some interest from international retail chains in the recent past, the open stock option is more suited given the lack of large Indian brands.

Made-in-India

• Global retail chains sourcing from India are offering assistance in registering Indian brands in the US
• Merchandisers with international retail majors scouting for tie-ups in India said while they had confined themselves to open sourcing agreements so far, they would prefer companies that had licence arrangements with MNCs
• In product segments like garden equipment and accessories also, where there has been some interest from international retail chains in the recent past, the open stock option is more suited given the lack of large Indian brands