Hermes India to break even in two years

Friday, 05 August 2011

Hermes India, the joint venture between France-based Hermes and Delhi-based Neelam Khanna and Ashok Khanna aims to break even in two years time. It has been operating in India for the past three years. Hermes India Retail and Distributors is a 51:49 JV between the two. Bertrand Michaud, regional MD India, Middle East and South East Asia says business in India has been slightly slow due to the high import duties levied on our products so it may take a bit longer in. But they are not worried as they are here for the next 50 years and the signs are encouraging. Hermes is known for its scarves, ties and leather bags and wants to pull in customers who would otherwise go to Milan or Paris. Apart from stores in Pune and Delhi, Hermes has opened a flagship in Mumbai, 5,000 sq. ft. The Mumbai store is spread over two levels in a heritage building opposite the Asiatic Library and Horniman Circle. Besides, Hermes plans to donate the proceeds of a range of scarves bearing Indian motifs sold in the Mumbai store, to the Asiatic Library to preserve and digitize old Sanskrit manuscripts.

Unlike other developing markets, which see a high proportion of sales coming from its bags and scarves, its sales in India are well balanced between scarves, bags and accessories. Neelam and Ashok Khanna are the same couple who have made Ananda in the Himalayas one of the finest spa destinations of India. In India Hermes sources fabrics from Ahmedabad, and silver and gold jewelry from Rajasthan. Keeping in mind Indian preferences, Hermes will launch a perfume specific to India by 2012. The most iconic Hermes products, the famous bags, are still made by hand. Focused on quality, Hermes takes the line that sales will take care of themselves, an attitude that seems to have worked.