{"id":6058,"date":"2023-05-26T08:42:00","date_gmt":"2023-05-26T03:12:00","guid":{"rendered":"https:\/\/www.thirdeyesight.in\/?p=6058"},"modified":"2023-08-23T20:31:30","modified_gmt":"2023-08-23T15:01:30","slug":"reliance-seeks-retail-dominance-in-india-with-comeback-deal-for-shein","status":"publish","type":"post","link":"https:\/\/myechoproject.com\/TES\/reliance-seeks-retail-dominance-in-india-with-comeback-deal-for-shein\/","title":{"rendered":"Reliance seeks retail dominance in India with comeback deal for Shein"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\"><em>Chloe Cornish in Mumbai and Eleanor Olcott in Hong Kong<\/em>, <em>Financial Times<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>May 26 2023<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">India\u2019s biggest company Reliance Industries is seeking to dominate the country\u2019s $10bn online domestic fashion market, striking a deal with Shein that will allow the rapidly growing Chinese retailer to return to the world\u2019s most populous nation.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The retail unit of billionaire Mukesh Ambani\u2019s petrol-to-telecoms conglomerate will tie up with Shein three years after India banned the online retailer\u2019s app in its attempt to freeze Chinese companies out of the local market in retaliation for border clashes that had left at least 20 Indian soldiers dead.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cWe can confirm Shein\u2019s partnership with Reliance Retail and have no additional comment at this time,\u201d said Shein, declining to answer questions about the structure of the deal. Reliance did not respond to queries about the partnership, which was first reported by the Wall Street Journal.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The addition of a low-priced offering gives India\u2019s biggest listed company by market capitalisation an important boost in its battle to dominate the country\u2019s growing online fashion retail market, which was worth $10bn in 2022, according to analyst estimates.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">As part of the licence agreement, which was recently approved by the government, Shein will receive a percentage of profits generated from its fast fashion sales in India, people familiar with the deal said, while Reliance will help Shein build a supply chain with India\u2019s garment industry for global exports.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The move into Indian sourcing comes as Shein diversifies its supply chain outside the coastal province of Guangdong in southern China, where it has 8,000 suppliers, mostly located in the garment hub of Panyu. Pandemic-era supply chain bottlenecks, rising labour costs in China and geopolitical tensions between Beijing and Washington have propelled multinational companies, including Apple and clothing retailer Mango, to migrate parts of their supply chains out of the country.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Shein, which does not sell in China, has been seeking to distance itself from its home country. Last year, it made its Singapore arm the de facto holding company, rapidly expanding its workforce there and shifting some of its operations from its China headquarters in Nanjing.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Shein will seek to minimise delivery times by having more manufacturing centres around the world. India, meanwhile, hopes to benefit from multinationals\u2019 \u201cChina plus one\u201d movement, a strategy that seeks to avoid investing only in China and aims to diversify supply chains to other countries.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Reliance has signed agreements with international luxury brands ranging from Balenciaga to Burberry, catering to India\u2019s small but growing demographic of super-rich consumers. In addition, it has nearly 13,000 bricks-and-mortar stores across the country selling affordable apparel.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>\u201cReliance\u2019s other international brand partnerships are more premium, being luxury or designer brands,\u201d said Devangshu Dutta, chief executive of consultant Third Eyesight. \u201cIndia is still a relatively low per capita income economy. The bigger opportunity is in brands which are euphemistically called value brands, and that\u2019s where Shein is positioned.\u201d<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For Shein, access to the Indian market will allow the company to boost sales as the pace of its expansion in Europe and the US begins to lose steam, according to people briefed on its growth figures.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Financial Times reported that in a recent presentation to investors, Shein forecast that gross merchandise value \u2014 the total value of merchandise sold on its platform \u2014 will almost triple by 2025 to $80.6bn compared with the figure last year.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The lofty revenue projections come ahead of a much anticipated initial public offering, which promises to be one of the largest listings of a Chinese-founded company in years.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In fashion ecommerce, Reliance lags behind Myntra, one of India\u2019s oldest ecommerce players, which merged with Walmart-backed Flipkart in 2014. Myntra accounts for around half of the online fashion market in India, according to Satish Meena, an independent ecommerce analyst based in Gurgaon.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cMyntra is the nucleus\u201d for online fashion, said Ankur Bisen, senior partner at retail consultancy Technopak Advisors, adding that its \u201ccohort\u201d of shoppers is primarily young and urban. \u201cWith the Reliance and Shein partnership, they would like to get into this cohort and break the monopoly of Myntra,\u201d Bisen said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Meena estimates that Reliance\u2019s ecommerce fashion business Ajio has about 4 per cent of market share, while Bisen put Ajio among the \u201clong tail\u201d of ecommerce fashion ventures behind Myntra. Reliance\u2019s JioMart online shop also sells clothes, alongside groceries and electronics.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>\u201cIf you look at Reliance as a company, it\u2019s about dominance and it\u2019s about long term,\u201d Dutta said.<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>(Published in the <a href=\"https:\/\/www.ft.com\/content\/a863317c-9baf-4a6f-9e72-1c976af7dfdd\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">Financial Times<\/a>)<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>India\u2019s biggest company Reliance Industries is seeking to dominate the country\u2019s $10bn online domestic fashion market, striking a deal with Shein that will allow the rapidly growing Chinese retailer to return to the world\u2019s most populous nation.<\/p>\n","protected":false},"author":1,"featured_media":6063,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[25,212,249,33,625,60,36,43,44,1],"tags":[52,174,59,191,69,164,147,241,192,242,166,471,659,65],"class_list":["post-6058","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-apparel","category-consumer","category-e-commerce","category-footwear","category-health-wellness","category-india","category-lifestyle-fashion","category-retail","category-soft-goods","category-uncategorized","tag-branding","tag-consumer","tag-india","tag-indian-market","tag-indian-retail-sector","tag-international-brand","tag-international-brands","tag-international-fashion-brand","tag-international-fashion-brands","tag-licensing","tag-modern-retail","tag-reliance","tag-reliance-retail","tag-retail"],"yoast_head":"<!-- This site is optimized with the Yoast SEO 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