It has been just over a year since?Erick Haskell?took over as the managing director of the German sportswear major Adidas Group’s India business. Haskell was brought in with a mandate to revive the Reebok brand in the country after the financial scandal broke last year. In an interview, he spoke with?Anand?J?on how the group has put the crisis behind and is on an expansion mode with the opening of 35 Reebok stores in 2013. Excerpts:
You had written to corporate affairs?ministry saying that the Group does not?wish the probe to extend to the company’s global executive board. What was the response?
Investigations are ongoing. I don’t have any update on that. We are really?focussed on running the day-to-day business. By and large the matter is behind us.
Where do you stand in terms of the number of stores now?
We have reduced the number of outlets from 900 to around 500 now. We essentially closed stores that were non-viable. We will open about 35 new stores in 2013. We will ensure that they are profitable for our partners as well. It is a controlled-expansion mode. We will continue to grow the Reebok brand in India.We are trying to expand into tier 2 and tier 3 cities. Around 30% of our new outlets are in these cities.
How far have you come from the Reebok crisis?
I don’t deny that it was a difficult time for the company. We made so much progress as a brand in 2013. We had some product launches this year, many marketing campaigns were carried out. Those events are really a matter of the past.
How does the current management team at Reebok look like?
I manage both brands. We have a joint CFO as well. Each brand has a brand director who reports to me. We essentially have shared resources across the brands.
Did you see the Group’s revenue decline? Have you surpassed the previous highest revenue numbers?
Yes, we saw a decline in 2012 but we have grown at a healthy rate in 2013. I cannot comment on the second question. We will open 80 stores for the combined entity and will see a similar growth in 2014 as well.?
How do you see competition from Puma and Nike in India?
With both the brands put together, we represent 50% of the sportswear market in India. So we dominate the market as a group. I am impressed with the growth we have witnessed here. They are good competitors, but we start from a leadership position.
Globally the Adidas Group saw a revenue decline in Q3 on account of currency fluctuation. India has also seen lot of currency headwinds. What is the impact on your business?
Certainly the rupee depreciation has an impact on our cost of imported goods. Roughly 20% of the group’s portfolio is imported. So far we have managed this and don’t have any negative impact. We are hopeful that the currency stays stable.
How are you?repositioning?Reebok and Adidas brands in India?
We are repositioning Reebok as a fitness brand. The Adidas positioning is as the?multi-sports brand. Different brands have different assets and events that we sponsor. For Reebok, we are sponsoring the Delhi half-marathon. On Adidas side, we are sponsoring the?FIFA World Cup.
