Brand sourcing gets Bangalored

BRAND SOURCING GOT BANGALORED
Some had identified Bangalore as the original destination while others like Adidas, Next and Marks & Spencers have shifted their operations from Delhi adding to the list.
The Economic Times

More Global Giants Are Making It The Hub

BANGALORE’S emergence as a key sourcing hub for the world’s top brands just took another leap. Adidas-Reebok combine, Next Plc and Calvin Klein are setting up their sourcing base here adding to an already impressive list that includes Wal-Mart, Tesco, Marks & Spencer, Tommy Hilfiger and a host other relatively smaller European brands.

While some of them identified Bangalore as the original destination after deciding to source directly from the country, others like Adidas, Next and Marks & Spencers have shifted their operations from Delhi. Bangalore’s growth as the largest domestic textile/garmenting cluster with a robust fabric feed from the nearby centres — like Coimbatore, Salem and Erode — make it an attractive sourcing destination for the global brands who look at India mainly for apparel and soft furnishings.

Adidas Sourcing Limited, for instance, is setting up a sourcing office in Bangalore to export apparel and footwear (it is coming up with a footwear facility in Chennai) to service the US and Europe markets. “Bangalore is ideally located with several factories capable of producing international quality apparel in the vicinity, and is well-connected to the international markets,” Andreas Gellner, MD, Adidas India. The Bangalore office will service as a sourcing hub for the global giant’s operations in Bangladesh, Pakistan and Sri Lanka. Adidas has other sourcing hubs in the Asia Pacific region in China, Vietnam and Thailand.

Next Plc, the UK retail chain, which till recently sourced through the Delhibased buying firm Impulse, is in the midst of setting up a sourcing centre here. Another big name entering Bangalore for sourcing purpose is Calvin Klein. The global designer brand is seen opening a direct sourcing facility by roping in a few officials who have been handling the duties for Tommy Hilfiger.

Besides these high profile names, there are smaller European brands like Mexx and Oilily, which have quietly slipped into Bangalore for critical sourcing operations. One among the largest import trading firms in the US, Capital Mercury, is another presence in the city’s growing sourcing map.

“There are about 1,800 to 2,000 textile and garmenting units in Bangalore, making it perhaps the largest cluster of its kind in the country,” says an industry source. It is estimated that Bangalore now accounts for roughly 30% of the country’s apparel exports pegged at Rs 40,000 crore.

Wal-Mart’s sourcing facility in Bangalore’s manages operations worth over a $1 billion, while Tesco’s sourcing is currently nearing the $100 million mark. Marks & Spencer, according to estimates, operates a sourcing business topping Rs 600 crore.

TALLYING UP
Textile units based in Bangalore 2,000
Bangalore’s share in textile exports 30%
Value of India’s total textile exports 40000 cr
Tesco’s sourcing from India $100 m
Wal-Mart India facility handles $1 bn
M&S outsourcing out of India
600 cr