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Rising Brand Awareness and Growing Penetration of organized Companies to Drive the Future: Ken Research

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With increasing media exposure from the likes of TV channels, video games, blockbuster of superheroes, children these days are much informed and aware of the latest fashion trends and have become more demanding and brand aware. Moreover, 18 million new births every year and a large section of the country’s population (28.0%) belonging to the age group of 0-14 years as of FY’2017, provide huge prospects for market growth.
Despite growing at a very healthy rate of over 20% per annum during FY’2012-FY’2017, the organized players accounted for a low market share of the overall kids’ apparel market in FY’2017. The market share of organized players is expected to incline steeply in the future.

Kids’ apparel market in India has been driven by the demand of non-recognized brands which manufacture garment products in local settings. Comparatively lower prices, sound quality and high room for bargaining for the customers are the primary reasons behind the wide scale dominance of the unorganized sector. Moreover, large scale availability of raw material in the country has allowed the unorganized sector to flourish by offering products at affordable prices. The prevalence of local players in this industry is further strengthened by the fact that revenues generated from imports of kids’ apparel (considered at import prices of goods) in FY’2017 were roughly 2% of the export revenues of kids’ apparel products in the same financial year. The organized segment was dominated by some major brands such as 612 League, Miniklub, Cucumber, Beebay, Babyhug, UCB Kids and Little Kangaroos. However, all these brands are characterized by poor penetration in rural areas and have their presence only in the urban, tier I and tier II cities. The Kid’s footwear market is more organized as compared to apparel, with major companies such as Bata, Liberty, Lancer and Relaxo operating in this space.

Most mom and pop stores in India are known to offer unbranded products, while some offer a combination of both branded and unbranded kids’ apparels. Availability of quality products at a much reasonable price as compared to branded products was primarily the reason behind the wide scale dominance of mom and pop stores countrywide, in terms of revenue. Some mom and pop stores operate as a part of cluster stores across the country. There are more than 5 lakh mom and pop stores in the country selling kids clothing. Mom and pop stores were followed by MBOs (multi-brand outlets) / large format stores, Online and EBOs (Exclusive brand outlets).

“A major portion of the population in India prefers domestic and unbranded products due to lower prices and easy availability. It is imperative for domestic and international companies to setup their own manufacturing unit in the country so as to be price competitive with other brands. Success has to be a combination of high quality, creative design and right value for money products.”, as per the research report titled, “India Kids’ Apparel and Footwear Market Outlook to 2022 – Surging Online Adoption and Launch of Private Label Brands will Drive Growth” by Ken Research

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