Samsonite to build on two brands in India

By K. T. Jagannathan

CHENNAI, FEB. 18. The $800 million global travel solution leader Samsonite Corporation is contemplating to launch hybrid luggage products in the Indian market through its up and running 60:40 joint venture here.

Giving a broad hint to this effect in an interview with The Hindu, Mr. Luc Van Nevel, President and Chief Executive Officer of Samsonite Corporation, said these new generation hybrid products were already in the international market. ``We are making them in Europe. These are available in the U.S. Soon, we are planning to bring it to India as well,'' he said.

The Chief Operating Officer of Samsonite India, Mr. Ramesh Tainwala, said the hybrid products would combine the advantages of hard and soft luggage.

The proposal comes even as Samsonite India has begun commercial production of Cruisair range of luggage from the newly built line at its Nashik facility in Maharashtra. ``In terms of wheel, in terms of handle and in terms of how we have conceived the suitcase, Cruisair really looks very nice,'' said Mr. Van Nevel.

Designed in Belgium, this range is meant for global customers. ``No other Samsonite company is going to make them,'' the President said, making it clear that Cruisair would be manufactured only in India. The first batch of Cruisair luggage had already been shipped to Belgium, Mr. Tainwala said.

The Nashik line is most likely to roll out around 15000 units a month. Perhaps, this will go up to 30,000 units a month from September. The Cruisair range - available in four sizes and colours initially - is expected to be marketed in Europe first and Asian markets like Singapore and Korea later.

This range would be introduced in the Indian market in the second-half of this year. Since the moulds are made in India, ``this has given us very nice cost advantage.''

Three years into the country, Samsonite has managed to garner a share of 15 per cent of the Rs. 450 core organised luggage market. In Chennai, it has a market share of 42 per cent. In the South, the share is 35 per cent. In Mumbai, Samsonite has a market share of 40 per cent. ``We are trying to capture the market based on the maturity of markets to receive and respond to good quality products,'' Mr. Tainwala said. At the moment, the focus was on metros and mini metros. The Indian venture, he hoped, would close the current financial year with a revenue of Rs. 100 crores, including exports of Cruisair products.

The export exercise could not have come at a better time as the luggage industry is growing at a tardy pace. The growth in value terms is 4-5 per cent. Unit-wise sales, however, have dropped by 38 per cent. Mr. Tainwala clearly saw premium products selling better than in the previous year.

Samsonite, Mr. Van Nevel asserted, ``has not touched either the high or low end of the market. We are staying away from them. We operate from middle end to higher ends''. The American Tourister brand which Samsonite had been selling ``has not touched the lower end of low brands,'' he said, dismissing even suggestions of Samsonite getting into the bottom end of the market.

Mr. Tainwala said the American Tourister brand had already been launched in the Indian market. ``Since the market for middle end in India is also big, we can fetch a larger volume in American Tourister,'' the COO said. In the last six months, this brand had contributed to 30 per cent of Samsonite India's business in value terms and 37 per cent in unit terms. The COO made it clear that Samsonite India would work on building the two brands - Samsonite and American Tourister.

Samsonite's business globally is split equally between hard and soft products. But in India, 85 per cent of the luggage market comprised hard products. Nonetheless, according to Mr. Tainwala, the soft segment was growing at over 100 per cent. He saw practically nil growth in the hard segment.

Mr. Tainwala indicated that Samsonite India was not keen on driving business on the wave of ad spend but on working to improve ``the ambience of the place where customers buy our products''.

Mr. Van Nevel was convinced a traveller in India could not be any different from another elsewhere in the globe. Mr. Tainwala could not disagree. Especially after his flopped bid to market small bags, made specifically for the sub-continent. The COO hinted that Samsonite India would walk into the black this year.

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