Saturday, 10 August 2013

How mending luxury leather products mints big money

Chun Powhughe, the 60-year-old co-owner of Kim Brothers at Jor Bagh in New Delhi, is as comfortable as an old shoe in his 300 sq ft store that is brimming over with his own brand of handcrafted shoes and hundreds of old Louis Vuittons, Tod's and Christian Louboutins.
Chun, whose family migrated from China to Kolkata in the 1930s, is visibly unfazed that his shoes, once extremely popular among Delhi's glitterati and used by late prime ministers PV Narasimha Rao and Indira Gandhi and many of the nation's top industrialists, are jostling for shelf space amid growing competition from the foreign luxury brands. Instead, like many other Chinese shoemakers and fledgling Indian firms, he has turned this into an opportunity and is minting money repairing and restoring these expensive luxury bags and shoes.

"Some of my regular clients, especially their children, have switched to foreign brands. But they still have to come to me," he says with a grin, and an eye on his 22-year old nephew, who is busy infusing a fresh lease of life in a pair of red leather shoes that costs Rs 30,000.

The trend is not confined to Delhi. Chitra Ambareesh, partner at the Bangalore-based ShoeVival-The Shoe Laundry says about 10-15 % of all shoes ShowVival gets every month are high-end luxury brands and business is growing at over 15% "In India, even the rich loathe to throw away their expensive shoes easily. The trend has become more palpable in the last few months," she adds.

All these companies are riding on the luxury boom in India during the last few years, and the current slowdown which is pinching their wallets as much as their expensive shoes. Sale of luxury goods grew more than 25% year on year especially after foreign brands were allowed to open their own stores. Rich Indians bought designer handbags, wallets, shoes, belts and jackets priced several lakhs of rupees, sometimes crores, as they grew richer in a booming economy. But the current slowdown is not only keeping the rich away from these stores, many of them have been forced to pull out their old stuff for a polish.

"Repairing, cleaning and restoring branded luxury products is adding to our core business of made to measure shoes," says Kenneth Lee, owner of KK Lee in Delhi's Khan Market, whose family, like Chun's, had started in the shoe making business in the 1950s.

"Last winter, one of my clients walked out of a luxury store at the Vasant Kunj mall and spilled ice-cream on her Rs 5-lakh handbag while getting into her car. Next day, she came rushing to me," says Lee. Had the lady gone back to the store, she would have to spend a few lakhs to undo the damage. "We did it for a few thousands and did it pretty well," he says.

Indian startups like ColorSpa, ShoeSpa, Reboot have taken the cue and are thriving on cleaning, restoring and repairing luxury leather products. Be it colouring the exteriors of an LV bag damaged while playing Holi, or giving a remake to a Gucci purse that had the bad luck of a solvent-based liquid being dropped on to it.

Mumbai-based Reboot Shoe Laundry that has A-list Bollywood celebrities as its clients is even considering expansion across India through franchise route. "In the last 2-3 years, consumers have understood the concept well and now we are getting inquiries from people across India who want to start the business in their own cities," says Vinnie Chadha, founder of Reboot Shoe Laundry. Her business is currently small with about Rs 25 lakh annual turnover, but is growing at a fast pace. "We broke even in the first year and have been approached by a couple of PE players for fund raising also," she says.

Talha Ahsan, who co-owns ColorSpa in Delhi's Hauz Khas Village says his business, set up only six months ago, is already on a roll. Thanks to the rains, and the damage the humidity, mud and puddles of water can cause to leather shoes and bags, he is flooded with customers. "We get expensive stilettos that are completely discolored and damaged due to years of use. Even the sole can be re-lacquered to restore the trademark," Ahsan tells a young girl who walks in with a pair of Christian Louboutin shoes.

Luxury brands have begun to secretly work with these entrepreneurs as sending the products to their workshops back in Italy or France cost a bomb and often scare away customers. A customer told this writer that the luxury brand had recommended she visit Kim Brothers or John Brothers, another Chinese shoemaker, who has a store in Connaught Place, for repairs, "as they were not expensive".

Asking not to be named, the brand head of a luxury brand in India, said, "Sending them back to the factory for a minor repair is very cumbersome and expensive as custom duties need to be paid again."

The services offered by the Indian companies can range anywhere between Rs 500 and Rs 3,000 per job depending on the kind of repair. Many people are also getting decades-old bags redone. "I had an old worn out, but very expensive bag that once belonged to my grandmother, lying in the closet. I didn't throw it away for emotional reasons, but now it's as good as a new one with a high degree of vintage value attached to it," says Ahmedabad-based Sonal Singh, who took the bag to a Mumbai store for repair. Pointing to the lack of awareness among Indian consumers about the right usage and maintenance of such products, Chun says there are a lot of people who have become rich overnight by selling land. "They have the money to buy an expensive shoe, but do not know how to use it well," he quips.
http://articles.economictimes.indiatimes.com/2013-08-07/news/41167941_1_rich-indians-luxury-expensive-shoes

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