Seiko scouts for minority partner for retail venture

JAPANESE giant Seiko Corporation may tap the FDI route for retailing watches in India. It is exploring the option of keeping 51% stake in a retail JV with a local partner. While FDI remains closed to large tracts of retail, the Centre has allowed 51% foreign investment in single brand retailing. Seiko is looking at FDI to set up a chain of flagship stores ‘to retail watches the Seiko way’ apart from taking the multi-brand outlet (MBO) channel in a select manner. “We are looking at options, and have not decided on anything at the moment,” Seiko Watch India MD Atsushi Kaneko told ET.

Currently, Seiko was finalising its MBO strategy ahead of the market launch in June this year. Seiko could also bring in its luxury watch brand Credo and its jewelry business to India. The company will target the top 8-10 cities to begin with. Seiko, which has come up with a fully-owned subsidiary in Bangalore for its India foray, declined to divulge how it intended to invest to establish market presence in India. “We are looking at a reasonable share (read double-digit) of the top-end Indian watch market by 2010,” Mr Kaneko added.

India’s premium watch market is estimated at around Rs 400 crore. Seiko is expected to show up with product portfolio priced upwards of Rs 7,000 going up to Rs 1.80 lakh for its high-end offering, Seiko Spring Drive. Bulk of its offerings could fall in the Rs 12,000-25,000 bracket competing with Rado and Tissot. “Our competitive edge will be technology. Brand Seiko has recall in India, but the brand has moved a long way from the way most Indians see Seiko,” he said.

Hence, Mr Kaneko believes it is essential to retail watches the Seiko way in India. This could be one reason why Seiko may explore FDI to control the retail experience at least in the flagship exclusive stores. It is learnt that Seiko would opt for a shop-in-shop format for its presence even in the MBO channel.

Q U I C K FA C T S

• Seiko Corporation took off in 1881 when Kintaro Hattori opened its predecessor K Hattori, a watch and jewellery shop, in Tokyo • Seiko is a Japanese word meaning "exquisite", "minute", or "success"

• Today Seico Corp is a holding company with 13 group companies with consolidated net sales of $1.8 billion (2005)

• When Seiko Astron, the world's first quartz watch, was introduced in 1969 it cost the same as a medium-sized car

Seiko Watch brands (Seiko Watch Corporation)

• Seiko,

• Credor,

• Galante,

• Wired,

• Wired XYZ,

• Alba,

• Pulsar,

• Lorus