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Large and giant apparel brands performed better than mid-level and small brands duriing the April-June quarter of the current fiscal, the textile industry's benchmark Clothing Manufacturers' Association of India (CMAI's) Apparel Index showed.
Overall, CMAI's Apparel Index jumped 6.2 points fior the June quarter, much like the previous quarter, with bigger brands performing far better in terms of sales. Their inventory holding was also lower during the quarter under consideration.
At a 6.2 point growth, the figure is approximately 54 percent higher than the index for small brands (with turnover between Rs 10 crore and 25 crore). Small brands have grown by 4.03 points while mid brands (with turnover between Rs 25 and 100 crore) have grown by 6.75 points. In fact, mid brands performed much better than small brands. But the actual success stories were the large brands (with turnover between Rs 100 and 300 crore), that have grown by 7.93 points and the giant brands (with turnover of above Rs 300 crore), that have a high index value of 10.67 points.
"The first quarter Index clearly indicates that large and giant brands are doing much better than small and mid-level ones. The Index pattern this quarter, much like last quarter, reflects that as the size of brands have gone up, the performance has improved. Interestingly, sales turnover also increases in the same pattern and, inverse, in the case of inventory holding. It clearly reflects the impact that sales turnover and inventory have on performance," the CMAI study showed.
"Our sales turnover grew because of the overall good sale at the retail level," said Sandeep Jain, Executive Director, Monte Carlo.
Among the four groups of brands based on turnovers, giant brands have been growing consistently each quarter. This time, too, giant brands grew the most in sales turnover while their inventory holding did not increase much, whereas small brands' sales turnover grew the lowest and had the highest increase in investment holding. Growing sales turnover, perhaps, explains why giant brands have a strong Index value at 10.67, whereas small brands scored a low 4.03.
Kunal Mehta, Vice President (Business Development and Marketing), Being Human, said, "We increased the number of stores. Our shop in shop (SIS) numbers have gone up and we started vertical distribution and are now available at around 200 member benefit online system (MBOs) in India. We have also increased our e-commerce partners."
A close look at the four parameters reveals sales turnover continued to grow moderately at 4.84 points. However, increased inventory holding continued to bog down the apparel industry's performance. In fact, this factor alone can offset the positive contributions of all other parameters.
Sell through and fresh investments improved, though moderately. Inventory holding increased across the board amongst all brands i.e. 74 per cent of them. However, 12 per cent said their inventory holding remained the same. A good 14 per cent witnessed a decrease in inventory holding.
Suraj Bhatt, Brand Head, Allen Solly, points out, "We have made fresh investments this quarter to fund higher sales and retail expansion."
Overall, the apparel industry failed to maintain growth against the same quarter last year on all aspects. Low consumer spending further affected the sales turnover. But nearly 48 per cent of the brands feel that the outlook for the next quarter, from July to September, is good.
