Zudio, a value-driven brand from Trent Limited, has experienced remarkable growth in India’s fast fashion market. Its journey, rooted in addressing the gap between high-end Westside products and affordable fashion, has transformed the brand into a dominant force in smaller cities. Offering stylish clothes under ₹999, Zudio has captured the mass-market consumer’s attention, thanks to strategic decisions like fast inventory turnover and the Franchise-Owned, Company-Operated (FOCO) model.
From Westside to Zudio: A Strategic Evolution
Originally, Trent’s flagship brand Westside contributed significantly to the company’s revenue but struggled with expansion in Tier 2 and Tier 3 cities due to its premium pricing. Trent identified the demand for affordable yet trendy fashion in these regions, leading to the launch of Zudio. From contributing just 2.2% of Trent’s revenue in 2018, Zudio surged to 48% by FY23, thanks to its mass appeal. Zudio’s growth not only filled this market gap but also elevated Trent’s overall performance.
What Sets Zudio Apart
- Affordable Fashion: Zudio’s core appeal lies in its pricing strategy, with most products under ₹999. This caters perfectly to the fashion-conscious but budget-minded Indian consumer.
- Private Labels & Fast Fashion: Zudio controls its private labels, allowing it to respond quickly to fashion trends, launching new collections every two weeks. This model, inspired by Zara, keeps the brand relevant and fresh.
- Economies of Scale: Bulk manufacturing has enabled Zudio to keep production costs low while maintaining quality. This allows the brand to offer competitive prices without compromising on margins.
- FOCO Model: The Franchise-Owned, Company-Operated model has played a crucial role in Zudio’s rapid expansion. It allows franchisees to handle infrastructure costs while Trent manages operations, helping the brand open more stores without financial strain. Zudio opened 219 new outlets between FY21 and FY23, and its store count had reached 559 by FY24.
- Fast Inventory Turnover: Zudio refreshes its stock every 15 days, significantly faster than competitors, ensuring customers return frequently for new collections. This consumer-centric approach has been key in building brand loyalty.
Zudio Beauty: Expanding into a New Segment
Building on its apparel success, Trent has now ventured into the affordable beauty market with Zudio Beauty. As rivals like Reliance and Nykaa focus on premium and luxury beauty products, Zudio Beauty seeks to replicate the same value-driven approach in cosmetics. Its first store opened in Bengaluru, with plans to expand into cities like Gurugram, Pune, and Hyderabad. This move is a natural extension of Zudio’s strategy, tapping into a mass-market segment that is underserved by premium competitors.
Zudio’s Role in Trent’s Growth and Global Expansion
Zudio’s rise has not only transformed Trent’s revenue structure but also positioned the brand as a key player in India’s retail industry. As of FY24, Zudio had surpassed Westside in terms of store count and was expected to outpace it in revenue soon. Trent reported a staggering 50% growth in sales for 2023-24, largely attributed to Zudio’s contribution. Zudio’s revenue reached ₹7,000 crore in FY24, and analysts predict this trajectory will continue.
In a bold move, Zudio also expanded internationally by opening its first store in Dubai, targeting the large Indian diaspora. This entry into the overseas market signals confidence in its business model and marks Zudio’s readiness for global challenges.
What the Future Holds for Zudio
With analysts forecasting Zudio to eventually surpass Westside as Trent’s leading revenue generator, the brand’s future looks promising. Its ability to marry affordability with style has resonated with India’s growing consumer class, particularly in small towns. Zudio’s success also stems from its exclusive design portfolio, low gross margin, and high productivity per square foot.
As the beauty segment gains momentum and expansion plans accelerate, Zudio seems poised to lead both fashion and beauty markets, domestically and internationally. Backed by Tata’s reputation for quality, Zudio is on track to further solidify its status as a fast-fashion powerhouse while exploring new horizons in beauty and international retail.
In conclusion, Zudio’s journey from a niche fashion brand to a retail giant is a testament to Trent’s strategic foresight and Zudio’s adaptability. With plans to dominate both fashion and beauty, Zudio’s influence on the Indian retail landscape is only set to grow, marking the brand as a significant player for years to come.
