German sports footwear maker and retailer Adidas Group has received government approval in India to open two outlets.
Adidas had been pursuing the 100% foreign direct investment (FDI) option under Single Brand Retail Trade (SBRT) in India since a while. In this regard, the company had submitted an application to the Department of Industrial Policy and Promotion (DIPP) in July 2015.
In January 2012, India had allowed 100% foreign investment in single-brand retail but with certain conditions which included sourcing of minimum 30% raw materials by value from small and medium enterprises (SMEs) in the country, reports The Economic Times.
Adidas Group India managing director Dave Thomas said that the new approvals will usher in growth prospects of the business with the presence of retail outlets and online channel complemented by the present franchise network.
Dave Thomas said: "We strongly believe own retail will enable us to take our market leadership position to an even higher level. It will give us additional flexibility to bring in global concepts across all categories in larger stores, thereby enabling us to further enhance the premium experience for our consumers."
The company plans to increase the number of its stores to 200 by the end of 2015 and to increase the number to 400 by April 2016 and taking the store count to 1,000 by 2020. Currently, it has 150 stores across the country.
Adidas' large format destination stores usually occupy 3,000 sq ft to 5,000 sq ft of retail space. The footwear company has been operating through 760 franchise retail stores. The company plans a simultaneous expansion work on its franchise distribution network and strengthening brand presence with large format store openings under the Adidas brand, DNA India reported.
The Adidas management is looking to focus on profitable growth and consolidating its position by targeting premium segments of the market. The company also plans to focus on its omni-channel approach by upgrading its stores with tablets that can be used to buy our products online, which are later delivered to customers' homes.