Firm aims at signing 90 deals by FY14-end, eyes 500 outlets in next four years

Siyaram Silk Mills Ltd has signed as many as 27 franchise agreements during the first two months of the current fiscal, in its bid to expand its retail footprint. According to a press release issued by the company, Siyaram Silk Mills had set a target of signing 90 franchise deals during 2013-14. It is also targeting 500 outlets by 2016-17, against the existing 120.

“Unlike food or health retail franchise, apparel retailing is not perishable and the logistics does not hamper the product quality. Hence apparel or textile franchise has the higher return on investment with low repayment time compared to other franchise segment,” said Megha Poddar, director of Siyaram Silk Mills. She further claimed that the expansion is expected to drive the company’s high margin revenues from this segment to Rs 60 crore annually in 2013-14 from the current level of Rs 35 crore.

Poddar said that franchisees would have to invest Rs 25 lakh on average for interior works and inventory. The mimimum space requirement is 800 square feet.

As part of the retail expansion, the company also is in the process of revamping and redesigning it outlet to give a new look and feel to discerning customers. While the renewed focus is on franchisee model, the company will continue with its conventional model of agent, distributor down to multi-brand outlet (MBO) model for disseminating its product portfolio.

Siyaram Silk Mills has presence of 200,000 MBOs across the country serviced through the conventional model of agents, distributors, wholesaler and retailer MBO and it will continue to remain in the same fashion.