Within the readymade segment we have branded and unbranded players.

A branded store is

wherein a manufacturer or marketer makes conscious efforts to promote his brand, such as

Koutons Retail India Limited, Madura Garments Peter England, Arvind Brand’s Newport,

ITC’s Wills Classic, and Raymond’s Park Avenue

There are several foreign brands that have successfully established their presence in the

country. These players may have come in via a tie-up with domestic concerns: (like

Benetton), or via the licensee route (like Allen Solly, Arrow). Some brands like Metro

ome in with Cash and Carry wholesale trading route, while Tommy Hilfiger, Marks and

Spencer’s, Speedo, Umbro etc retail through franchisee channels.

Globally private labels contribute to 17% of retail sales and are growing at 5% pa. Private

Labels provide higher margin to the retailers simultaneously offering lower price to the

consumers. This is a strategy adopted globally and now is extensively used by Indian

retailers.

There are certain private label brands which have done exceedingly well like John Miller,

Bare, Stop, Splash. With the implementation of the uniform tax structure across the country,

quite a few of these labels are likely to aspire to achieve a brand status.

A survey carried by AC Nielsen has identified that 56% of their survey respondents in India

consider private labels to be good alternatives to manufacturer brands. This exponential

growth can be seen in the areas of groceries, home care, clothing and apparel.

KOUTONS RETAIL

Koutons are an integrated apparel manufacturing and retail company in India. they are in

the business of designing, manufacturing and retailing apparel under the “Koutons” and

“Charlie Outlaw” brands through a network of 999 exclusive brand outlets (as of August

20, 2007) across India.

They started their business with the formation of a partnership firm “M/s. Charlie

Creations”. Theyestablished a manufacturing unit (having a capacity to manufacture

approximately 20,000 pieces of apparel per annum) in Delhi in 1993. In 1994, their

Promoters with the vision of broadening operations incorporated our Company, as a private

limited company i.e. “Charlie Creations Private Limited”. The Company started its operations

by taking over the business of the erstwhile partnership firm. As of August 20, 2007 we had 18
in-house manufacturing/finishing units and 14 warehouses which are spread across various

locations in and around Gurgaon, Haryana. They have increased their annual finishing and

manufacturing capacity from 3,000,000 and 600,000 pieces of apparel, respectively as of

March 31, 2005 to

22,920,000 and 12,360,000 pieces of apparel, respectively as of March 31, 2007 they have also

entered into fabricating agreements with various manufacturing units to which we outsource

stitching of certain apparel. Their manufacturing and finishing facilities are backed by

adequate facilities for product testing, apparel development, design studio and sampling

infrastructure to ensure high quality apparel for our customers.

Their brand “Koutons” has contributed to the success of our business. Sales from their brand

“Koutons” has increased from Rs. 516.32 million for fiscal 2005 to Rs. 3,726.91 million for

fiscal 2007 and has contributed 99.11% and 92.34% of their total income in fiscal 2006 and

2007, respectively. They have positioned the “Koutons” brand in the middle to high fashion

segment, offering a complete range of a man’s wardrobe (in the age group of 22 to 45

years) ranging from formal to casual and party wear. They have reinvented and re-

launched their old premier brand “Charlie” as “Charlie Outlaw”. The “Charlie Outlaw”

brand is a casual brand targeted at fashion conscious youngsters in the age group of 14 to 25

years and is positioned as a fashionable and contemporary, value for money brand
Though it is rightly said that coin has two faces. The story of Koutons has also two faces. Koutons’ has diluted the
brand name of itself by offering 50-99% discounts through out the year. This strategy has generated the perception
among the consumers that Koutons’ is a low price brand. But C.K Prahlad’s bottom of pyramid along with middle of
pyramid theory is working for Koutons. It does not matter whether they cater to the demand of upper class,
fashionable customers. For them the most rewarding strategy is to target middle class who buys on discounts.

MUMBAI: Shares of Koutons Retail moved higher after IFCI acquired 5.89 per cent stake in the
company by invoking the shares pledged by promoters.

NEW DELHI: Apparel and fashion wear chain Koutons India Retail on Friday posted a 12.3 per
cent dip in its net profit for the quarter ended March 31, 2010, to Rs 31.43 crore as against the
same period a year ago.
The company had a net profit of Rs 35.82 crore in the quarter-ended March 31, 2009, Koutons
India Retail said in a statement.

NEW DELHI: Apparel retailer Koutons Retail India Ltd on Wednesday said it has appointed SBI
Capital Markets to draft a debt recast scheme as it was unable to repay short-term debt.

"The continuous downfall in the stock price has led to an inordinate delay in raising equity for
the company. Because of this, we are being unable to meet the repayment obligations of short
term loans," the company said in a statement.

The New Delhi-based retailer, valued at Rs 866 million, has lost about 91 per cent in market
capitalisation in the past six months as concerns mounted about the company's dipping sales
and fears of default.