Myntra to sub-franchise Mango stores in India

Myntra, the country’s largest online fashion retailer, is close to signing up two sub-franchisees to manage Mango stores in India, according to three people familiar with the matter.

Myntra, which took over the offline and online franchisee rights for the Spanish fashion and lifestyle brand in India earlier this year, is likely to appoint Samarth Lifestyle and G&B Fashion as the subfranchisees.

Jaipur-based Samarth operates more than 100 outlets of Benetton, Tommy Hilfiger, US Polo, Puma, Lee, Wrangler and Calvin Klein, while New Delhi-based G&B operates 25 outlets of Benetton in the National Capital Region.

Samarth Lifestyle and G&B declined to comment on the possible deals with Mango. Myntra has decided not to run the Mango stores itself, at least in the initial stages, due to high capital expenditure, operational costs and the need to maintain a separate team for offline stores, the people said.

“We have not inherited any stores from the earlier franchisees as we did not find a feasible way to work with them,” a Myntra spokesperson said in an e-mailed response.

“We will be setting up new Mango stores in prime locations in all metros and are working with our franchisees and malls to determine the location of these new stores.”

Mango’s former franchisee Major Brands has already given notice to vacate a prominent mall in New Delhi. The mall operator hasn’t decided whether to lease the premises to Mango.

One person said Myntra’s decision to let franchisees operate the Mango stores stems from the fact that its own entry into brick-and mortar retail a month ago with a Roadster-branded store has so far received a lukewarm response in Bengaluru, which the company said wasn’t correct.

“This is absolutely baseless. While the Roadster store has been launched to create experiences for customers, it has been very well received and has performed beyond our expectations,” Myntra said in an emailed statement.

“We have seen over 4,500 footfalls in the first month itself which is 2X of the footfalls of other leading brands on the street, with 60 per cent of the shoppers being new customer acquisitions.” On the other hand, Myntra, which was acquired by Flipkart in 2014, said sales of Mango products have surged 25 per cent on its platform since it signed on the Spanish fashion and lifestyle brand in February.

“We are using a hybrid model of retail and sub-franchisees where all the investments in the store will be borne by us and the day-today operations of the store will be managed by the subfranchisees,” the company spokesperson said in the email. “In phase two of the launch, Myntra will operate and manage a few Mango stores end-to-end.”

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