Italian luxury brand Furla (Known For Footwear & Accessories) to ride a superfast in India
"We are yet to get a go ahead from the Foreign Investment Promotion Board of India to have a joint venture here. The moment it happens, our investments will be made at a super-fast speed," Eraldo Poletto, CEO of the Italian firm, told ET. Poletto, 51, was in Delhi on an official visit.
Furla, known for its handbags and shoes, has sought the government's approval to operate single-brand retail outlets through a 51:49 joint venture with Gurgaon-based Genesis, which currently runs two Furla stores as a franchisee and plans to open a third one in either Kolkata or Bangalore.
The joint venture plans to invest about Rs 13 crore in the first four years to open stores, with Furla bringing in Rs 6.6 crore, according to the application submitted to FIPB.
Poletto sees India as a unique market where one requires a lot of patience to establish a brand in the minds of people and expect financial returns. "The value of time here is different from anywhere else in the world," he said. "I think a brand has to wait to evolve in India, but once it does the growth is faster." He expects Furla stores in India to break even in 2-3 years of operations.
The Bologna-based, family-owned brand is on an aggressive expansion drive in Asia. Earlier this year it announced a joint venture with China's Fung Group to open 100 boutiques there in four years.
Japan is Furla's biggest market, accounting for 27% of its total sales, ahead of home market Italy that contributes 25% of the firm's turnover. The company reported 18% jump in its turnover last calendar at 212 million (approx Rs 1,650 crore).
"Asia (excluding Japan) is around 13% of the total business and we have very aggressive plans to become much bigger in the next two years," Poletto said. Furla is present in more than 90 countries with about 325 single-brand stores. It produces about 2.5 million pieces every year, mostly in Italy. Some items sourced from China as well.
When asked about India as a sourcing destination, Poletto said Furla did buy some jewellery and accessories from India some time back, but not at the moment. "India is competitive if we use Indian leather but it is different from the kind of products we do," he said.