Speaking about the sports goods & amenities, Puma & Adidas has been massive favorites since decades. With the motive of tapping the change in the law with regards to FDI, the two firms are looking to set up their eCommerce portals in the country.
Towards the dawn of 2015, the Indian government relaxed the rules for FDI in retail. The government permitted manufacturers to sell their products through wholesale, retail and eCommerce channel as well for the first time. “It has been decided that a manufacturer will be permitted to sell its product through wholesale and/or retail, including through eCommerce without government approval,” the DIPP said at the time. Close on the heels of the government announcement, Adidas had made its intentions clear of opening its fully-owned outlet in India. However, Adidas & Puma, both are now looking to tap the potential of the eCommerce spectrum extensively. The two firms have also sought clarification and approval from the government on whether their existing wholesale entities can engage in direct retailing and eCommerce, executives said. On March 3, Puma had filed an application with the Department of Industrial Policy & Promotion (DIPP), the nodal agency for foreign direct investment in India. Adidas has sought a similar approval from the DIPP, a person familiar with the matter said. According to the DIPP website, Adidas also applied to the department on March 3.
Both Adidas & Puma are Germany-based sports goods manufacturers with a sizeable presence across the globe. Last year, Adidas’s sales head Roland Auschel had made it clear that India is a big part of the global brand expansion. The company is looking to cross the magical number of 1000 stores soon in India along with setting up an eCommerce portal. The football scene in India along with the eCommerce ecosystem has been booming & the younger generation is looking for quality products to realize their footballing dream. Adidas has been one of the best football equipment providers across the globe. The rising popularity of the ISL (Indian Super League) & I-League will provide them an opportunity to connect with a large number of people. The company also has tie-ups with companies such as FedEx, Ecom Express & Blue Dart for logistics support. On the other hand, last year, Puma emerged as the top global lifestyle brand in India. It upstaged several rivals like Adidas, Benetton and Zara. The government’s approval for operating its own eCommerce portal would further strengthen the brand’s presence in the country. “Based on the new regulation on single-brand retail, we have sought approval for Puma Sports India to do retail and eCommerce. The same entity was originally allowed to do wholesale of Puma products,” said Abhishek Ganguly, MD, Puma India. The new FDI policy can definitely help make things easier and simpler for the foreign brands. It will bring efficiency in supply chain, inventory, sourcing and generating employment in retail. “It’s a very progressive approach from the government. Once our approval comes through, it will make business much smoother for us,” concluded Mr. Ganguly, MD, Puma India.