Leading legacy retail brands are looking at ways and means to go online. They are recognising the potential of having an online presence and are increasingly looking at associations with existing online players rather than starting from scratch. The latest to join the trend are Titan and Arvind, the textile brand.
Tata group’s Titan, favourite watch brand of many Indians, is reportedly buying a majority share in online jewellery store CaratLane. The move will give Titan a toehold in the online segment, and CaratLane will get access to Tata’s luxury jewellery line Tanishq.
Textile firm Arvind to take over Freecultr
In the meanwhile, Arvind is looking at acquiring Freecultr, an online crowdsourcing platform. Freecultr, founded in 2011, started off as an online clothing store. However, over time, it has turned to crowdsourcing T-shirts. Interestingly, Freecultr also has a chain of physical retail stores in select cities of NCR, Mumbai, Lucknow and Dehradun.
Backed by Sequoia Capital and Ru-Net, the company found itself in want of funds. The deal with Arvind might be to aid the cash flow. A person (citing anonymity) familiar with the deal confirms this,
“They have been boot-strapped lately and have been trying very hard to raise funds.”
Online fund crunch a real crisis with all the money drying up
Online companies are finding themselves in a precarious position. Money is hard to come by with investors turning up their noses at any mention of more funds. Harminder Sahni, founder of Wazir Advisors makes some chilling statements. He says,
“That money has now disappeared and it has clearly come down to this pass that these businesses are unviable or cannot survive without money.”
He also says that online companies, “are available at throw away prices and these are going to shut down unless somebody comes and acquires them.”
These are ominous predictions for the online industry, and it establishes the fact that online still has a long way to go. A healthy relationship between online and offline companies will help plug the leaks wherever they occur, and enable a mutually beneficial playing ground for both.