Gianni Versace and Blues Clothing Company part ways

The saga of broken tie ups between a global brand

and its Indian partner has taken another toll. After fashion brand Esprit and Aditya Birla Group’s Madura ended their seven-year-old distribution agreement, Milan-based luxury fashion company Gianni Versace SpA has terminated its exclusive franchise agreement with Indian partner Blues Clothing Company. Clearly showcasing expectations mismatch between the global brand and its domestic partner.

Although Versace is expecting to shut its two stores in Delhi and one in Mumbai by the end of this month, the luxury brand is buoyant about India growth story post the government’s decision of allowing foreign luxury brands to set up fully-owned stores in India. The three Versace stores in the country are meanwhile offering up to 70 per cent discounts on their entire product range.

Sehgal founded Blues Clothing in 1996 after selling books under the name of Sehgal Brothers for 30 years. For years, Blues Clothing imported and sold European style ready-to-wear clothing in India. In 2005, the firm signed exclusive franchise agreements with brands like Gianni Versace, Versace Collection, Cadini and Corneliani.

It may be recalled that in 2008, UK’s Marks & Spencer ended its franchise agreement with Planet Retail and opted for a joint venture with Reliance for faster roll-out of its stores. In 2010, Italy’s GAS ended its venture with textile and apparel major Raymond and entered India on its own through the cash and carry route. Recently, the Italian owners of menswear luxury brand Corneliani also found a new partner in India in OSL Luxury.