Rajesh Jain is the Managing Director and Chief Executive Officer for Sports And Leisure Apparel Limited – Lacoste Licensee in India. He has nurtured the brand since October 2009 with his persistent efforts and focused vision. His strong belief in his own quote, “Top Line, Bottom Line, Growth, Customer Delight and Human Resource Development – Everything else is merely incidental” has cultivated the brand with firm establishments reaching out to every major city/ metro of the country today.
The Lacoste brand, a symbol of relaxed elegance, was created in 1933 by the famous tennis champion René Lacoste. The Crocodile logo embodies the style and spirit of this champion. Celebrating more than 85 years of its existence globally, Lacoste is a ‘lifestyle’ brand today, offering a unique and original universe of clothing for women, men and children, shoes, perfume, leather goods, eyeglasses, belts, watches, home textiles and underwear. Both in daily life and on sports fields, Lacoste bases its success on the essential values of authenticity, performance and elegance.
From a financial background analyzing and evaluating company strategies to details, Rajesh’s inclination for the retail industry was an opportunity to adapt to an industry which is characterized by ever changing demands and varied preferences. Rajesh is a Master of Commerce from the University of Delhi and a Chartered Accountant from the Institute of Chartered Accountants of India. He obtained his Company Secretary degree from the Institute of Company Secretaries of India.
A stalwart of the retail industry now, Rajesh talks to us about the industry’s challenges and how Lacoste maneuvered them.
On the challenges in retail
The biggest challenge Rajesh faced as CEO was the emergence of e-commerce companies that used heavy discounts to penetrate the market. To deal with the competition, many offline stores resorted to the same method and slashed prices. Rajesh decided to not go down that path as he did not believe in diluting brand value. The result of that decision however, was a tough 1.5 years of slow sales and tough times. In hindsight though, Rajesh thinks that that was a great decision as their perseverance paid off and their brand value stands intact.
With regards to the industry, Rajesh points out some bigger problems.
“There is no dearth of challenges in retail.”
One of the biggest challenges according to Rajesh is an issue that hasn’t changed in over a decade. He asserts that there is an acute shortage of premium retail space at the right cost and terms for a brand like Lacoste. “The per square foot cost in India is as high as anywhere else in the world, but the revenues do not match.” He is also wary of counterfeits and unauthorized sales that are rampant in the industry.
Lacoste deals with the scarcity of premium retail space through a method called selective distribution network wherein they choose their doors very carefully. They ensure that they are present in the right space, catering to the right target customers so that they are able to survive and deal with high rentals.
On scaling up
Lacoste is present in 52 locations in India and has seamlessly gone from being a polo company to a complete lifestyle company over the decades.
Rajesh advocates being personally involved in the entire process of scaling up. “Everytime we open a new store, I personally go and check it out. There is something in the air that one needs to personally feel to gauge if it will work or not.”
He also attributes Lacoste’s success to his efficient team who do all the groundwork. Acquiring and maintaining a great team is irreplaceable according to him. He stresses on looking for the right kind of people, those who are motivated by something greater than just money.
One of the challenges with scaling up also remains managing inventory successfully. For that, Rajesh and his team perform a lot of data analysis and use system processes. They also routinely write off inventory after a few seasons lest it be misused. For these reasons, they have a tight control over their inventory and are very well placed.
On changing consumer preferences
Rajesh says that consumer buying patterns have changed tremendously over the last two decades. From buying fabric and getting a garment stitched, Indians now seek a global standard of quality and thereby, buy premium brands. Rajesh attributes this shift in behaviour to two major reasons – increasing exposure and disposable income. The exposure came with the internet, media and boom in travelling abroad. The increase in disposable incomes, especially due to the IT industry further fueled it.
Rajesh also notes that with the emergence of e-commerce giants, the question used to be a choice between online and offline. However, it is now clear that in India, the two shall continue to exist and complement each other. Customers seek the ease and convenience of e-commerce while feeding off the touch and feel experience at brick and mortar stores. This omni channel presence will only serve to bring growth to the industry.