Adidas to expand stores in India in 2008
27 May 2008
Kolkata: Sports brand Adidas has announced plans to add 125 franchise outlets to its India retail network in 2008.
According to Andreas Gellner, managing director at Adidas India Marketing, the count is set to rise to 450 by the end of the year, from the present count of 325, and will come up both in small towns as well as larger cities.
Gellner also admitted that spiralling real estate prices have impacted Adidas' plans in India, and that the prevailing rentals were nowhere near realistic.
The retail industry can support a maximum rental cost of around 15-17 per cent of its turnover per square feet.
However, current rentals are over the 20 per cent per square feet, going up to 40 per cent per square feet in some cases. Consequently, many retailers have shelved or scaled back their expansion plans, for want of cost effective retail space.
Adidas' sales in India have grown at 30 per cent annually for the last four years, and Gellner said the company is optimistic of the sales rising 30-35 per cent this year.
