LUXURY WATCHES

Swapnaja Bhosle 162

Harshad Deshpande 163
PGDBM II (Retail)
RETAILING
Retailing is defined as all activities
involved in selling goods or services
directly to final consumers for their
personal, non-business use via shops,
market, door to door selling, mail order or
over the internet where the buyer intended
to consume the product through personal,
family or household dues.
THE ORGANISED RETAIL PIE 2006
(Market Size: Rs 55,000 Crore at current prices)
Catering
7%
Footwear
9%
Clothing & Accessories
39%
Watches
3%
Jewellery
3%
Health & Beauty
1%
Phrmaceuticals
2%
Consumer Electronics
9%
Mobilephone,Accessories & services
3%
Food & Grocery
11%
Furnishings Furniture
7%
Books,Music,Gifts
3%
Entertainment
3%
* India Retail Report 2007
Luxury Watches
A luxury watch may be defined as a
timepiece which not only has the
functionality of time-wear but is bought
mainly for its brand value, precision, the
legacy of the brand
THE SIZE OF THE SECTOR
3% of organized retail market.
Indian Retail Value:
Total:Rs.3,950 crore (in 2006)
Organised: Rs. 1,800 crore

Luxury watches :
8% of luxury goods
Rs 500 crore ,
YOY growth 22%

* India retail report 2007

PLAYERS IN THE MARKET
TOP PLAYERS
Only Indian Player :
-Titan
Foreign Players :
- Rolex ,Omega, Cartier,Tag Heuer,Rado ( all
swiss made),Citizen (Japan),

Brand Retail Presence Retail Outlets Retail Sales ( INR Crore)
05-06 06-07 Projection
for 2010
05-06 06-07 Projection
for 2010
05-06 06-07 Projection
for 2010
Titan 108 125 165 183 223 331 263 350 780
Rado 5 7 NA 5 12 NA NA NA NA
Omega 3 7 NA 5 10 NA NA NA NA
Longines 20 22 NA 75 80 NA NA NA NA
Movado 12 18 NA 50 100 NA NA NA NA
PERFORMANCE AND PROJECTIONS
CRITICAL SUCCESS FACTORS
Brand Name
Premium price
Design
Choice of the retailer
METHOD OF RETALING
Branded chain outlets
Multi-brand outlets
Department stores
Exclusive brand shops
E-tailing

MAJOR PROBLEMS
Fakes as fakes
Fakes as originals
Look-alikes
Replicas
Smuggling
IMPACT OF ENVIRONMENTAL
& POLITICAL SCENARIO
The slow but gradual reduction in duty will
boost the sales, discourage smuggling
Westernization of Indian culture


IMPACT ON OTHER SECTORS

LEGAL REQUIREMENTS
Authorized dealership license
Import permission
Shop and establishment License

DUTY & TAXATION
Effective Import duty : 35% (after budget 2007)
Sales Tax: 12.5%

IMPLICATION OF
THE BUDGET 2007
Effective Import Duty down by 5%
Service Tax of 12.24% on renting of
immovable property may discourage
prospective retailers

PORTERS FIVE FORCES MODEL
Forces High Medium Low
Threat of New Entrants

Threat of Substitute products

Bargaining Power of Customers

Bargaining Power of Suppliers

Competitive Rivalry

SWOT ANALYSIS
STRENGTHS : Strong GDP growth
Increases in PPP

WEAKNESS : High import duty
Limited range on offer

OPPORTUNITIES : The sustained GDP growth
Youngest Country by 2020
Westernization of Indian culture

THREATS : Availability of fakes
High end mobile phones for functionality

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