Reliance Retail and UK-based Clarks have ended their two-year joint venture due to significant disagreements over the terms of their partnership, according to three sources familiar with the matter.
As a result, Clarks is closing all its stores in India, which one source described as the UK footwear brand’s “exit strategy.”
32 Exclusive Clarks Stores Shut Across Cities:
According to the UK company’s website, Clarks Reliance Footwear Pvt Ltd, the India joint venture, managed 32 exclusive Clarks-branded stores across cities such as New Delhi, Mumbai, Bengaluru, Lucknow, Hyderabad, and Chennai.
Half a dozen mall owners confirmed the development, noting that Clarks has either closed stores in their shopping centres or is in the process of shutting them down.
Possible Re-entry as Fully-Owned Subsidiary:
However, a second source suggested that Clarks might restructure its India business and re-enter the market as a fully-owned subsidiary. India permits 100% foreign ownership in single-brand retail, allowing companies to sell various products under one brand name, such as Apple, Puma, or Marks & Spencer.
A global spokesperson for Clarks declined to comment, stating via email, “We won’t be commenting on this situation.” Reliance Brands, the Reliance Retail unit involved in the joint venture with Clarks, did not respond to requests for comment.
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Several major global brands, including Apple Inc., H&M, Uniqlo, Decathlon, and Ikea, have utilised the single-brand retail route, which allows them to operate exclusive stores, e-commerce businesses, franchises, and wholesale under a unified licence. However, single-brand licences have conditions: companies with more than 51% foreign investment must source nearly one-third of their products from within India.
Clarks, based in Somerset, England, entered India in 2009 through Clarks Future Footwear Ltd., a joint venture with Kishore Biyani’s Future Group. In 2022, Clarks shifted its partnership to Reliance Brands due to financial difficulties faced by the Biyani group.
A third source familiar with the situation said, “Clarks’ owners were dissatisfied with the way things were progressing with Reliance and were also uncomfortable with the terms of the partnership. As a result, they decided to terminate the agreement.”
