Updated April 26th, 2024 at 16:26 IST

What EXACTLY is Zudio’s fast fashion formula?

Zudio's strategy of offering a wide range of products at affordable prices, particularly below Rs 999, has resonated well with young consumers.

Reported by: Business Desk
Zudio | Image:Zudio
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Zudio’s success:  Trent's success in the last quarter appears to have surpassed that of its competitors in the Indian apparel market, despite challenges such as sluggish demand and restrained consumer spending. The rapid expansion of its youth-focused, budget-friendly Zudio stores seems to have been a key factor in this outperformance.

Zudio's strategy of offering a wide range of products at affordable prices, particularly below Rs 999, has resonated well with young consumers seeking to update their wardrobes without breaking the bank.

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In contrast, other apparel chains have had to contend with rising costs, leading them to raise prices and potentially dampen sales further in an environment where consumers are already cautious about their spending due to persistent inflation.

Analysts anticipate Trent's revenue for the March quarter to have surged by 46.1 per cent, marking the 11th consecutive quarter of outperformance. This stellar performance highlights Trent's ability to capture market share and sustain the growth momentum, especially compared to its peers such as Shoppers Stop and Arvind Fashions, which have reported more modest growth in recent quarters.

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Expansion is the key

Trent's strategic focus on expanding its Zudio stores across India has been instrumental in its success. By steadily increasing its store count and gradually diversifying its product offerings, Trent has managed to strengthen its position in the market. In contrast, some of its competitors have struggled with experimentation across various formats, losing sight of a cohesive strategy.

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Despite the entry of new players like Reliance Industries and Aditya Birla into the low-priced apparel segment, analysts do not foresee a significant impact on Trent's growth trajectory. Trent's focused approach and established presence in the market are expected to continue driving its success going forward.

Trent's strategic approach to expansion, particularly through its Zudio stores, has been characterised by a focused and gradual process, in contrast to some of its competitors who have experimented with multiple formats. By concentrating on one goal at a time and establishing a strong presence in clothing before expanding into footwear, Zudio has been able to build a solid foundation for growth.

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Difference of Scale

The significant difference in store counts between Trent and its competitors highlights the scale of Trent's expansion efforts. While Shoppers Stop, Aditya Birla Fashion and Retail, and V-Mart Retail have varying numbers of stores, Trent's aggressive expansion, especially with Zudio, has propelled its overall store count to 715 as of December 31st.

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Analysts, including those at Technopak and Axis Securities, remain bullish on Trent's growth prospects despite the entry of new players like Reliance Industries and Aditya Birla into the low-priced apparel segment.

Trent's established presence and focused expansion strategy are expected to help it maintain strong double-digit growth, potentially even benefiting from newer players capturing market share from independent stores, which currently dominate Indian apparel sales.

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With Reuters Inputs

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Published April 26th, 2024 at 16:26 IST