Harkirat Singh, Managing Director, Woodland India, is not pertubed by the growing prominence of E-commerce companies. During an exclusive interaction with The Dollar Business, he says the Indian market is big enough to accommodate everyone and also speaks about Woodland’s global ventures.

Interview by Vanita Peter D’souza | August 2015 Issue | The Dollar Business

TDB: Woodland has evolved as a strong brand over the last decade or so. Give us a sense of your journey.

Harkirat Singh (HS): The market has really changed a lot since we started. We used to source our leather and other materials from India, but it was never our plan to market our products here. We used to primarily sell in Canada, Northern Europe and Russia. But retail has changed the face of the market here.

When we came in, there were hardly any organised retailers. It was very difficult to sell under those conditions. We feared whether the payments would come in or not. So, we started opening our own stores and gradually, also saw the mall culture coming in. Change has been constant since we began.

TDB: Most well-known international shoe brands are present in India in a big way. On top of that, unbranded shoes also have a strong presence in the market. Given this, how do you deal with competition?

HS: Competition has always existed. The Indian market is big and continuously growing. When a person is buying shoes, he/she first buys an unbranded product, then aspires for a lower brand which is affordable, and then, looks for technical products that are the best in the market. There is always this process of graduation in the buying habits of a customer. With time, people look for brands since they know their quality is better and they offer more value for money.[sociallocker id="9714"]

For a market like India, we have to cater to all kinds of customers. At the moment, we are an outdoor brand and there’s not much competition for us. There are sports brands and other brands doing look-a-like of Woodland. What we do is try and put up stores in localities where brands already exist. This, since none is satisfied with one brand. Customers always want to try different brands. To deal with competition, we have to be better than them, both in terms of price and quality.

TDB: Reports suggest that you plan to invest Rs.500 crore over the next five years. Tell us a bit about your expansion plans.

HS: We don’t want to invest everything altogether in a short span. We expect the market to grow gradually over a period of time. Hence, we too want to go slow and steady.

With the present capacity, we are growing at about 20%. Within the next three years, we plan to double our capacity. For that we need to import machinery, technology and set up new plants. Every year, for the next five years, we plan to open 50-60 new stores in tier III cities.

TDB: How bullish are you on E-commerce? Has it affected your retail business in any way?

HS: E-commerce has been there for quite some time now. But we have seen major growth only in the last three years because of big players like Flipkart and Amazon coming in. Despite this, the number of stores have also been growing. There were some issues earlier because E-commerce companies were giving a lot of discounts, thereby affecting the sales at stores. But this is gradually smoothening out. I think, going forward, both E-commerce and stores will co-exist. This is only but natural.

TDB: Tell us about Woodland’s international business. Do you have plans to expand into new markets overseas?

HS: We are already present in Southeast Asian countries. Woodland Asia Pacific, based in Hong Kong has its own stores and is planning to enter Singapore, Malaysia and China. Woodland CIS manages businesses in Russia and Ukraine. Woodland Italy is based in Florence, does designing, and also manages marketing there.

Exploring new markets is an ongoing process for us. We are venturing into South Africa and also South American countries and the response in these markets have been extremely good.

TDB: What is the perception of the Woodland as a brand in the international market?

HS: Woodland originally came from Canada. Of course, India is one of the most important markets for Woodland, so there is always a connection with India. Our products match international standards and are very outdoor-centric. So, the brand is not associated with any one country and we don’t want to do that either. It is a very generic name. I don’t think we face any issue.

Moreover, it’s we Indians who feel Indian products are not good. Take markets like China. In their t-shirts, the fabric is Indian. They feel Indian cotton is the best. There are many things available in India that are really very good and we should be proud of them. The biggest global brands, be it Zara or Gap, are manufactured in Bangladesh, Sri Lanka and India.

People are not bothered where the product is manufactured. They just trust the brand. Manufacturing hubs of the world have shifted. You don’t find products made in USA or Canada anymore. Even our Canadian factory has got shifted. It’s not possible to manufacture out there as the cost of production is very high.

TDB: Currently, how much do overseas markets contribute to your revenue? Also tell us about the imported component in your raw materials.

HS: We earn 20% of our total revenue from overseas markets. Our leather is totally imported. Our apparel fabric is imported. So, I would say about 50-60% of our raw materials are imported.

TDB: Are you happy with the export incentives and duty drawbacks that the Indian government provides to leather shoes and jackets?

HS: Duty drawback doesn’t really matter to us. But since it’s there and is being given by the government, it’s welcome. However, I don’t think it’s enough to sell in overseas markets. The government should do much more as a lot of brands are made in India and sold overseas.