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Dec 15, 2016
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Myntra seals the deal for Jabong with Arcadia group

Published
Dec 15, 2016

Flipkart-owned online fashion retailer Myntra has renegotiated some contracts signed by Jabong, after it found that they required high levels of minimum orders from top foreign brands, including Arcadia Group-owned labels Dorothy Perkins, Topshop and Topman, two people with direct knowledge of the development told the Economic Times.
 

Jabong


"Now [the minimum guarantee] has been reduced. Plus, they now can sell these brands on all three platforms – Jabong, Myntra and in some cases on Flipkart as well," the source said, adding that Topshop won’t be available on Flipkart.

Arcadia, UK’s largest fashion retail group, operates over 600 stores in 35 countries in North and South America, Europe, Southeast Asia, Middle East and other markets and its brands include Evans, Miss Selfridge, Burton, Outfit and Wallis. Jabong signed a deal with the London-based group in early 2014 to sell high-street fashion label Dorothy Perkins exclusively on its platform and subsequently brought in other Arcadia brands including Topshop and Topman.

Myntra acquired Jabong for about $70 million in July, pipping bidders including Future Group and Snapdeal. com.
It is now trying to bring Jabong back to financial health after the Gurgaon-based company lost its sheen over the years as costs rose and losses spiralled.
 
The management wil attempt to raise both Myntra and Jabong to profitability at the Ebitda (earnings before interest, tax, depreciation and amortisation) level by December 2017, Myntra chief executive officer Ananth Narayanan told ET in an interview last month.

"We are going to push for both and we are going to look for (Ebitda profitability) together," he said, adding that Jabong is expected to grow between 30-50% in the financial year ending March 2018.
 
 

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