New Delhi: With the Indian retail sector having opened up to foreign players, it is Swedish retailer Rusta that has now announced its plans to set up its operations in the country. While the company has been sourcing finished products from India for the past one decade, the furniture and leisure products manufacturer has now come up with plans to set up its office in India as also up its imports from the country.
""We are very positive about India. India is a huge country and we realized it had to contribute to our growth more than what it is currently,"" said Goran Westerberg, CEO, Rusta.
The company, which has been sourcing goods worth $10 million from India until now, will now increase the same to around $40 million per year as well as increase its manpower as it seeks to buy products directly from suppliers now. ""We realized that running our business by way of third party agents was not a sustainable model...obviously we will grow in terms of the number of offices here too,"" Westerberg said.
The $450 million company deals in a wide range of products including furniture, decorative items, home textiles etc. While the company currently has stores only in Sweden, almost 50% of its products are sourced from other countries in Asia and Europe.
With the new investments in place, Westerberg said India will rank as the company's second biggest market for sourcing after China in the next few years. Currently India remains at the tenth position, ranking after China, Indonesia, Vietnam and others. Almost 45% of products for the company is being sourced from China.
Despite the government allowing 100% foreign direct investment ( FDI) in the single brand retail sector, the company said it is not keen on setting up its stores in the country. Even as opening of the sector will provide India with the necessary skills and competence, Westerberg said the company will first explore Scandinavian countries for expansion before looking at Asia.
""We are looking at India as a long term market. It is a huge challenge to get known here, both as an importer and a retailer,"" he said.
Rusta currently has 67 stores in Sweden and plans to add 10-12 stores every year. The company has five offices in Asia, including in China, Bangkok, Shanghai and now India.
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