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Retail News February 2008 |
Birla Retail in talks with farmers' co-ops for direct procurement
Even as India's largest business conglomerate Reliance Industries is facing trouble over its retail venture over procurement of farm products, its competitor Aditya Birla Retail Ltd, the retail arm of the $23-billion Aditya Birla Group, is trying to overcome the hurdles by tying up with farmers' cooperative societies.
The company, that has set a target of establishing 1,000-1,500 supermarkets and has earmarked Rs 8,000-9,000 crore in the next five years, is planning to tie-up with cooperatives to procure fresh farm products, vegetables and fruits.
"We are talking with some of the major cooperatives. They (cooperatives) have come to us," said Sanjay Badhe, senior vice-president of Aditya Birla's new retail initiative 'more'.
Meanwhile, the company has also gained access into farm sector by establishing direct links with farmers. Currently, it has around 25 collection centres across the country to procure farm products directly from farmers, said Sumant Sinha, chief executive officer of Aditya Birla Retail.
By the end of March 2008, it will have 500 supermarkets that include the retail chains acquired from Trinethra Super Retail, which are being rebranded under the umbrella of 'more'. In addition to supermarkets, the company would also set up 50-100 hypermarkets, each spread over a minimum area of 75, 000 sq ft, in the next five years.
February 5, 2008
Source: The Financial Express
Aditya Birla Retail has announced rebranding of Trinethra stores in Andhra Pradesh into its own format `more'.
Addressing a press conference here on Friday, Mr Sumant Sinha, Chief Executive Officer of the retail company, said the rebranding would be completed by the end of February. The company acquired Trinethra last year from India Value Fund. With this rebranding, the ‘more’ network would now comprise 350 outlets in various cities. Majority of them (278) are in the South. The company plans to open up to 1,500 supermarket format stores and 100 hypermarkets in the next three-four years.
February 2, 2008
Source: Hindu Businessline
Aditya Birla Retail to invest Rs10,000cr
Aditya Birla Retail (ABRL), the retail arm of the Aditya Birla Group, would be investing Rs 8,000 to Rs 10,000 crore in expanding its operations across the country over a period of five years.
The company, which aims to emerge as one of the leading retail players in India, plans to have nearly 1,500 supermarket and 100 hypermarket stores in the next five years. It is also investing in backend infrastructure to develop a robust supply chain, Sumant Sinha, chief executive officer, ABRL said.
ABRL, which launched its first store in May 2007 at Pune, currently has nearly 400 supermarket stores and one hypermarket store. Its retail footprint in South India extended to 275 stores following the acquisition of Trinethra Super Retail stores last year. The company is setting up a hypermarket in Baroda by this month-end. At present, it has one such store in Mysore.
Andrew Denby, chief executive officer (supermarkets), ABRL, said the company's retail stores served 2 million customers last month.
February 1, 2008
Source: Business Standard
Reliance to launch auto speciality stores
Reliance Retail Ltd will open on Thursday the first outlet in a chain of speciality stores that will sell auto accessories, and service cars in a bid to get a share of the wallets of car owners in one of the world’s fastest growing automobile market.
The company will launch Reliance AutoZone outlets in the western town of Jamnagar in Gujarat, where its parent Reliance Industries Ltd has a refinery. It plans to open up to 400 such stores nationwide in the next three-four years. Each AutoZone outlet will house a service centre for cars as well as two-wheelers.
The store will also retail electric bikes and the company plans to offer buying and selling of used cars in coming months. The company plans to open many of the AutoZone outlets alongside Reliance Retail’s other formats, including the hypermarkets and supermarkets, as well as having such outlets in independent locations.
Car makers currently sell 1.4 million cars a year in India and the figure is expected to touch 2.2 million units by 2010. Reliance says it has not tied up with any of the auto companies and will go it alone.
Reliance has picked Jamnagar to roll out its first 12,000 sq. ft AutoZone outlet as the company has space next to the hypermarket that it opened there this week.
January 31, 2008
Source: LiveMint
Arvind Brands to launch large format stores
VF Arvind Brands announced that the company would be opening up large format retail stores as an effort to combat high rentals. The company, which is a joint venture between the VF Corp and Arvind Mills, will be unveiling its new outlets later on this year. Properties for the new outlets are in the process of being taken already. Most outlets will be in the range of 3,000 to 6,000 sq ft.
The company will be selling brands such as Jansport along with denim brands such as Lee and Wrangler, so that all brands complement each other.
January 30, 2008
Source: The Economic Times
Aditya Retail witnesses growth in South
The Aditya Birla Retail was seen a significant growth in retail in south India, as compared to other regions of the country. The south Indian market is growing faster due to organized retail being in the region for a longer period of time. The company also saw greater growth in the region as it bought local chain Trinethra in January 2007, which already had a strong regional presence with its brands FabCity, Fabmall and Trinethra.
According to Suman Sinha, CEO of Aditya Birla Retail, the acquisition of Trinethra propelled the company into having a strong presence in south India, in the states of Andhra Pradesh, Tamil Nadu, Kerala and Karnataka. The company has 275 stores in the south of which 68 are Fabmall stores that are located in Karnataka. Aditya Birla Retail also has 60 stores in the city of Bangalore in Karnataka, 8 stores in Mysore and 10 stores in Mangalore.
The company plans to re-brand all of its Fabmall stores by the end to January to its own brand called More. The company will also be looking to open stores in smaller tier II and tier III cities. Aditya Birla Retail is also keen on launching its own specialty formats, for segments such as footwear, consumer durables, discount stores and jewelry.
January 26, 2008
Source: Business Standard, The Hindu Business Line
Reliance Retail to tie up with international retail giants
After its marketing and distribution agreement with Apple Inc., Reliance Retail is now looking to form similar agreements with other international retailers and is already holding talks with 3-4 companies to create an exclusive tie up in the specialty format arena.
According to Bijou Kurien, president and CEO of Reliance Retail (Lifestyle), “The tie-ups for speciality retail will be in non-food, non-FMCG categories such as apparel, footwear, consumer electronics, home and interiors and furniture among others.” The company is reportedly in talks with Lowe, the US based home improvement retailer. The company’s tie up with Apple to open its iStore in Reliance Digital has already started operations in Bangalore.
January 25, 2008
Source: The Economic Times
Big Bazaar plans to become independent entity
The Future Group’s flagship format, Big Bazaar will be turning into an independent entity and is currently planning an aggressive expansion for the next two years. According to Rajan Malhotra, CEO of Big Bazaar, “We plan to invest substantial amounts in the next one-and-a-half to two years in order to increase our footprint to 300 by the end of June 2009.”
There are 80 Big Bazaar stores at present and has signed property agreements to open 140 more. The company will be investing Rs. 3,000 crore over the next two years for its plans. Big Bazaar will also be focusing on in-house labels for further growth and will be promoting its own labels to the mainstream.
January 25, 2008
Source: The Hindu Business Line
Reliance to open 45 TimeOut stores in next 3 years
Reliance Retail will be adding 45 Reliance TimeOut stores in the country in the next three years, These stores will stock everything from books, stationary items, music, toys etc. According to Bijou Kurien, President and CEO of Reliance Retail (Lifestyle), the company will be looking to open stores across the country, even in tier I and tier II cities.
At present the company has launched the store as part of a pilot project in Bangalore and Gurgaon and another store would be opening in Kochi in March this year. The company will be investing Rs. 3-20 crore per store, depending on the size and location of the store.
January 24, 2008
Source: The Economic Times
Arvind Mills to invest Rs. 400 crore in retail business
Arvind Mills announced that it will be investing Rs. 400 crore in the next four years to expand its retail business and reach its target of becoming a billion-dollar company. Arvind Mills will be putting in Rs. 300 crore in large format retail stores and Rs. 100 crore in smaller format stores.
According to the company, there will be 30 large format Megamart outlets opened and about 200 small format Megamart stores opened in 100 cities by the year 2012. Each outlet will receive Rs. 8-10 crore as investment. The first of the company’s Megamart Outlet Center’s was launched, and will be opening second Megamart outlet in Pune at the end of May.
January 23, 2008
Source: Financial Express
Videocon to make its foray in cash and carry retail
One of the country’s largest consumer durable retailers, Videocon Industries will be making its debut in the lifestyle and grocery retailing arena with its cash and carry format of outlets. Videocon has reportedly already hired many senior level expats who have retail experience with global companies. The venture is to be headed by Marco Padella, an Italian who has worked with companies such a Carrefour and Metro AG.
Videocon will reportedly be tying up with a global major, but which company it will be is not yet known. Videocon’s subsidiaries such as Next Retail, Planet M and its cash and carry business will be formed under Videocon Retail in mid 2008, instead of Videocon Industries as it is currently positioned.
According to Venugopal Dhoot, CMD of Videocon Industries, “The growth in consumer demand and the growing share of the organised players in retail is compelling. We see the retail business, which is currently doubling for us each year, as a great value proposition.” The company has brought in KSA Technopak, Ernst & Young and Price WaterhouseCoopers to advise the team on its retail initiative, while in the mean time, the company has been busy acquiring land in Calcutta, Bangalore, Ahmedabad, Ahmednagar and Aurangabad.
The company hopes to open 40 large stores, ranging from 75,000-1 million sq ft by the year 2012. Stores will carry a variety of items such as food, grocery, apparel, consumer electronics, home furnishings, general merchandise and other items.
January 16, 2008
Source: The Economic Times
SPAR might launch chain of large kirana stores
Dutch retailer SPAR International who recently tied up with Landmark Group for a hypermarket format store chain, might also be creating a chain of kirana stores that might be launched as early as 2009. With its master licensee, Max Hypermarkets, SPAR is planning to have sub-licensee agreements with bigger kirana stores so that it can be a part of the neighborhood supermarket format.
The company operates as a neighborhood store or as a local supermarket in most countries and will be following similar principles for its functioning in India. According to Gordon R Campbell, MD of SPAR International, “As modern retail progresses in India, people who run the small stores will expand into large neighbourhood stores. We will work with these people who run their own local supermarkets. These independent retailers can be part of the Spar umbrella in India.”
Under the new arrangement, SPAR will assist kirana stores with layout of stores, retail technology, merchandising and other aspects of the business. SPAR currently operates three types of formats; a hypermarket format, a large supermarket format and SPAR Express, a small size format.
January 16, 2008
Source: The Economic Times
Koutons Retail to acquire 51% of Upper Class
Men’s apparel manufacturer, Koutons Retail announced that it will be acquiring 51% stake in Upper Class, a Delhi based ladies wear brand. Upper Class already has a strong base in women’s wear and will be the perfect compliment to Koutons Retail, expanding portfolio. The company was listed in 2007 and has a Rs. 3,000 crore market capitalization currently.
Upper Class is owned by Rajesh and Amita Sachdeva and specializes in casual wear bottoms for women. The company is worth Rs. 25 crore and exports its products to all the leading European brands and is also available at Splash and Lulu stores in the Middle East.
Its products are sold at multi-brand outlets such as Globus, Shoppers’ Stop, Piramyd and Pantaloons and are also available at exclusive stores in Delhi, Ludhiana, Vadodara and Jaipur. According to Rajesh Sachdeva, the company would like to grow with this new arrangement and will help Koutons make its entry into the overseas market.
January 16, 2008
Source: The Economic Times
Future Group to invest Rs. 300 crore in Future Ventures
The Future Group will be investing Rs. 300 crore in Future Ventures India Ltd, so that the company can handle acquisitions. According to Pankaj Thapar, Future Capital Holdings Ltd (FCHL) Head of Investments and Acquisions, "Future Ventures would act mainly as an investment company for group's acquisitions. The group has decided to pump in Rs. 300 crore within 2008." All investments by the group and funds managed by FHCL will not be clubbed together.
January 13, 2008
Source: The Economic Times
Future Group looks for fresh acquisitions
The Future Group is keen to grow its business through fresh acquisitions and is reportedly in advanced stage of talks to acquire stake in companies in both fashion and food retail segments. According to Kishore Biyani, CEO of Future Group, “We are negotiating to pick up stakes in several retail firms that are mainly in the apparel and food segment. Some of these deals are in fairly advanced stages of negotiation. We will not pick up more than 50% in any of the chains. We are eyeing both national and regional retail chains.”
The company recently bought a minority stake in Sankalp Retail Value Stores, which is the master franchisee of MyDollarStore, a US based retail chain, which have pioneered the concept of dollar stores in India and offer international products at fixed prices of Rs. 99 only.
January 12, 2008
Source: The Economic Times
Reliance Retail to launch home solutions format store
There is a buzz in the marketplace about Reliance Retail planning to unveil its brand of home format stores in Kolkata on a trial basis. The company has reportedly acquired prime lots of real estate where it will launch the first of its home format stores, which will stock everything for the home, ranging from furnishings, décor, curios, lifestyle products and kitchenware.
If the pilot project in Kolkata is deemed as successful, the company will be opening around 1,200 such stores across the country. Reliance Retail director Raghu Pillai is said to be heading this new division, and there are also reports that the company has tied up with US home store giant Lowe’s for this venture.
Some are suggesting that the land being used for these stores was originally acquired for Reliance Fresh stores, which were ultimately put on hold for the entire state of West Bengal and are now being used for other formats of Reliance Retail.
January 05, 2008
Source: The Economic Times
Fresh approach: from farm to shop, old ways get a new twist
Every tomato and cauliflower at ITC Ltd’s Choupal Fresh store here tells a tale and therein lies a larger tale—one about how modern retail initiatives are slowly but surely starting to transform India’s famously leaky farm-to-kitchen supply chain.
Most customers at ITC’s fruit and vegetable stores here seem to barely notice the small flyers, which talk of how the vegetables got there, but that’s fine by the company, better known as India’s largest cigarette maker.
What matters to ITC is the perception of freshness that it has been able to create and, more critically, how it has been able to improvise a system, at least locally, that allows the budding retailer to bring fresh produce at more attractive prices to customers even as farmers get better prices and much more certitude in their life.
Amid swirling and unanswered questions about the good and bad of organized retail in India and the impact it might have on existing systems of buying and selling, especially fruit and vegetables, many big industrial houses have jumped into food retailing.
Many of them have ambitious plans to either create their own supply chains or partner with others to dramatically cut down on what many believe is significant—up to one-third—wastage of fruit and vegetables in India today. Meanwhile, several industry estimates have food and grocery as the fastest growing among all segments of organized retail. Currently just 1% of all fruit and vegetables sold in India are estimated to be through modern retail.
While critics of organized retail have pointed to the lack of cold chains and other transportation infrastructure as evidence of modern retail only paying lip service to farmers, companies such as ITC are looking at creative local loops to develop more reliable—and profitable—ways to link farmers to their customers.
For the Choupal Fresh stores in this city, the story actually begins at Anil Kashith’s eight-acre farm in Yadgaon village, where the Kashith brothers grow vegetables and grapes.
Every morning, Kashith gets a phone call telling him which vegetables ITC needs that day and in what quantity. When the company truck rolls in at around 10am, he harvests exactly what was needed and loads the vegetables on to the truck.
The truck then does the rounds of some 300 similar farms and gets to the ITC’s collection centre at Manchar around noon. Here, the final destination of the produce is clearly marked and the produce is weighed, sorted and stacked for each store. The farmers are paid and the produce moves on to the stores by 1pm.
By 3pm, Kashith’s vegetables are in Pune’s store shelves and billed as Today’s Harvest. It is proving to be a draw, says S. Sivakumar, chief executive of ITC Agri Business. “We tell people where the vegetables came from in part to improve the assessment of freshness that consumers make.”
February 4, 2008
Source: LiveMint
Checkpoint survey cautions against retail shrinkage
It's that time of the year again when retailers gear up to woo their customers with the best of everything -- from lucrative merchandise, great offers to excellent services. Everything is at its peak this season. But on the other hand, the dark side to retail is called "retail shrinkage" is also at its highest point this season.
Shrinkage losses are caused mainly by people stealing goods or money from the company (by customers, employees) and also by a range of small or large process errors, accounting lapses and pricing mistakes that produce apparent inventory losses. According to a recent global research conducted by Centre for Retail Research, UK and sponsored by Checkpoint Systems Inc, shrinkage cost the world's retailers $98.6 billion, representing an annual "tax" on honest consumers everywhere of $287.70 per household.
The Global Retail Theft Barometer Survey Information Report deals with all retail sectors and vertical markets in India, Australia, Japan, Singapore and Thailand. The survey information was provided from 103 large retail businesses of these countries. They operated 16,230 retail stores with combined retail sales of $65,418 million, equivalent to 6% of retail sales in these five countries. The highest shrinkage rate was found in India, 2.90 per cent, a reduction of 9.4% over last year's 3.20%.
February 4, 2008
Source: Expressindia.com
Retail biggies cash in on patriotic fever
Retailers are realizing that Republic Day and the sense of patriotism it generates, is a great day to cash in on creating special sales for consumers. The biggest of the sales takes place each year at Big Bazaar outlets, which holds one of its annual “Sabse Saste teen din” (the years cheapest three days) sale, and offers a wide variety of discounts.
The sale will continue on January 27th as well. The company netted around Rs. 100 crore on single day sale two years ago. Last year, sales for the three-day period reached Rs. 150 crore and the company is hoping for a record sales figure this year as well.
This year Delhi based grocery chain Big Apple created a sale where it sold 26 items for Rs. 26 only. Reliance Trendz also had a special offer for 59% off on certain products in celebration of the country’s 59th Republic Day. Spencer’s created an offer of winning free cars, bikes and holiday packages, while Ritu Wears offered a discount of 26% on merchandise already marked at 50% off.
January 25, 2008
Source: The Economic Times
Retail fraud adds up to a Rs. 9,000 crore loss annually
The organized retail industry is growing by leaps and bounds, but the number of thefts is also increasing very rapidly and accounts for an estimated Rs. 9,000 crore each year. Shrinkage for Indian retailers varies between 3-4%, which is almost double than what it is in the west. Retailers are fighting back and investing in mechanisms to control shrinkage, such as RFID’s, IT solutions and training employees to fully understand and counter shrinkage.
According to Himanshu Chakrawarti, COO of Landmark, “The Indian version of a 'slip & fall’ scenario is typically a situation when a consumer claims he’s missing some valuable from the bag he had kept with the security. The matter invariably goes to the courts once the consumer sues and the retailer lines up a legal defence. Though such cases are still rare, it’s happening.”
Some of the popular methods being used are return fraud, slip and fall, which for the Indian scenario translates to customers claiming that valuables from bags kept at security are missing, and the rapidly gaining method of sweet heartening, where an employee teams up with a friend to bill an expensive item with a lower-priced product.
January 22, 2008
Source: The Economic Times
International brands such as Puma, Esprit and Tommy Hilfiger are doing very well as consumers look to own a greater number of ‘branded merchandise’. Brands have been doing well, thanks to high margins and strong marketing and branding which have created a definite persona in the minds of customers.
Brands with high ‘aspirational value’ are faring the best, as consumers are willing to pay higher amounts for this merchandise. According to Sailesh Chaturvedi, CEO of Tommy Hilfiger India, “This is clearly the case of customer upgradation. It happened in many other sectors like people buying bigger TVs, cars with bigger engines and now it is happening with apparel.”
Global brands such as Tommy Hilfiger are growing at over 100% and will reach Rs. 100 crore by the end of the financial year; Esprit is growing at over 200% and will reach a turnover of Rs. 75 crore. The original aspirational brands such as Louis Philippe, Van Heusen, ColorPlus and Levis are also doing well.
January 17, 2008
Source: The Economic Times
Retailing to grow faster in India that in the US
In an interview with Rediff, Rodney Fitch, Founder and Chairman of Fitch, one of the world’s largest design consultancies in the world, emphasized India’s role in the global retail market and stated that retailing in India would grow faster than in the Unites States. Fitch has designed stores for Wal-Mart, Best Buy, Marks & Spencer, Tesco, Target and several others of the world’s leading retailers.
Describing India’s retail sector as “wonderful, exciting and challenging”, he said that the country lacked design resources currently and with the country’s strong visual culture, the market has attracted design firms such as Portland, Landor, Fitch and Brand Union. The company is part of the WPP communication group and has offices in Mumbai and Delhi at present and will soon be opening an office in Bangalore and other cities as well.
January 14, 2008
Source: Rediff Money
Younger generation driving retail growth in India
The retail sector in India is one of the most exciting and dynamic sectors and has seen a significant growth in the past few years with the entry of several new chains. Factors such as increasing disposable incomes in the middle class, higher number of consumers in the urban areas, easy availability of credit, rising nuclear families, larger number of working women and a rural consumer who is awakening to the convenience of modern retail stores are some of the factors fueling the growth in the sector.
As a greater number of younger people start to work, their amount that is spent on products such as lifestyle products, eating out, services etc increases. Consumers no longer feel guilty about spending money and like to indulge themselves rather than save their money.
According to an analysis by Ernst & Young, the number of households in the upper middle class and high-income group has increased by 270%, from 30 million to 81 million. With over 50% of the population under the age of 25, the youth is driving the growth in the retail sector and will continue to do so for some time ahead as well.
The three main aspects that most youth look at before making purchasing decisions are uniqueness of a product, how contemporary it is and its value for money. Having a unique product is rapidly becoming the most important part of the decision making process and retailers are playing into this need.
January 09, 2008
Source: The Economic Times
Value for money is deciding factor for Indian grocery shoppers
A new survey conducted by Nielsen Company found that Indian consumers look for value for money in products they purchase. In an online survey conducted by the company, around 91% of respondents voted for ‘Good Value for Money’ as an important factor when selecting which grocery store to shop at.
Factors such as prices, promotions and perceptions about the store are also important factors in making that decision. According to Rajshree Dave, Director of Client Solutions for The Nielsen Company, “For Indians getting valued brands for a lesser price enhances their shopping experience and is a motivating factor for them to be more loyal to the stores.”
Other factors such as high quality of brands, location and availability of parking space are also important in selecting a grocery store. Interestingly, around 64% of consumers like to research and compare store prices and 58% of consumers selected stores based on word of mouth.
January 09, 2008
Source: Yahoo News
Indian farmers & traders to take on Wal-Mart
Farmers and traders in India who have been opposing the entry of global retail giants such as Wal-Mart are planning to create a chain of superstores where they will sell their products directly so as to not let the few large players set the market prices. This new venture will be backed by the Maharashtra government, which will reduce the infrastructure costs.
According to Sunil Pawar, general manager of the state’s agricultural marketing board, "It's a viable idea to counter private players, and if everything goes to plan the first of the superstores can come up in a few months." He added that the board was also in consultation with farmers’ cooperatives and traders associations and that the government had been very positive about the project.
Farmers and traders across the country have been struggling to overcome the new competition from retail giants such as Reliance Retail and are worried that they will not be able to survive for long. If all goes well, the first of the superstores will be launched in the next few months.
January 03, 2008
Source: The Economic Times
College students use the Christmas break to earn some money in retail
The Christmas break was the perfect opportunity for many college students to earn some money working at retail stores. The concept of temporary recruitment has been increasing, especially in sectors that are facing a shortage of staff, like the retail sector. Temporary jobs can earn students anything from Rs. 1,500-7,000 for 7-10 days worth of work.
According to Narendra Kala, CEO of Matrix HR Solutions, "While increased sales is key to additional staff needs, catering to maximum customers by providing high aesthetics as per the occasion is also a reason." Bulk of the demand in retail during the holiday period is for front-end jobs. Having good communication skills, computer knowledge and a pleasant personality are required to be placed for these retail jobs.
January 03, 2008
Source: Financial Express
Wal-Mart poised for cash & carry foray
The Bentonville-based retail giant Wal-Mart has finalised the business model for its cash & carry (wholesale) business in India.
The first warehouse (distribution centre), which will be up and running in Ludhiana, Punjab, by this June, will have a format similar to Wal-Mart models in the US. However, the product profile will be different from the US stores.
Wal-Mart’s cash & carry business, which is a 50:50 joint venture with the New Delhi-based Bharti group, is meant for large institutional or wholesale buyers and is not for retail sales.
Ted P Huffman, director of supply chain and logistics for Bharti Wal-Mart, said, “The distribution centre will be similar to Wal-Mart centres in the US, but it will be smaller.” While centres in the US are spread over 1 million sq ft —two football fields put together—the Indian centre will have a size of 80,000 sq ft. He says high real estate costs are the reason for smaller distribution centres.
Under the terms of the joint venture, Bharti will use Wal-Mart's back-end supply chain technology to sell to wholesale retailers. This includes the inventory system, logistics technology, cold chain infrastructure, truck tracking programmes and fuel management.
According to sources in the know, Bharti Wal-Mart had made plans for rolling out the technology for the distribution centre by the end of 2008 and Wal-Mart CEO Lee Scott had personally asked for the Indian operations to up and running by the end of the next quarter.
Further, the company is studying other locations across India to set up distribution centres. The Ludhiana centre will have 30-50 employees to sort goods for dispatch to different stores in North India.
February 3, 2008
Source: Hindustan Times
Esprit gearing up to launch new products
Casual wear company Esprit will be introducing a new range of products such as sportswear, home furnishings, cosmetics and footwear in an effort to launch itself as a lifestyle brand instead of just a clothing brand. The company will also be unveiling its large format stores, which will be around 8,000-15,000sq ft of space, which will be run by Madura Garments. The company expects to reach revenues of Rs. 75 crore this financial year.
Esprit currently has one large format store located at the Select CityWalk mall in New Delhi. The company plans to have 10-15 of such stores in the country by 2010 where it will offer the entire range of its brand, not just clothing for men and women. Manjula Tiwari, Brand Head of Esprit India, emphasized that the company was a lifestyle brand globally and wants to present the complete offering in India as well.
Esprit has 30 stores at present and aims to have stores in 21 cities and have 150 stores. New stores will be opened in cities such as Chennai, Kolkata and Hyderabad, and markets such as Bangalore, Mumbai and Delhi where the company already has stores will be further expanded.
January 28, 2008
Source: The Economic Times
Sears eyes cash and carry format in India
US retail chain Sears is showing interest in setting up a cash and carry business in India as it is the only format where 100% FDI is permitted. Company representatives have reportedly held meetings with officials of the Department of Industrial Policy and Planning so as to better understand the requirements. If all goes through, the company might be setting up in the next quarter.
Sears is the fourth largest retailer in the US and has around 3,800 stores in North America. Since the company already has a large stake in wholesale business in the US and Canada, the company is keen only for the cash and carry format in India as well.
Other international retailers who will be setting up shop in this format include Wal-Mart, which has tied up with Bharti and French retailer Carrefour. Germany’s Metro and South African chain Shoprite are the only two international retailers in the cash and carry format at the moment. Most retailers are keen to get their foot into the Indian retail market, so that when restrictions are lifted, they already have a base established and can swiftly move to consumer retail.
January 28, 2008
Source: The Economic Times
Carrefour to enter cash-and-carry market in India
French retail giant Carrefour announced that it will be entering the cash-and-carry segment in India and is currently in the final negotiations for its franchisee partner for other retail stores. According to a statement issued by the French Embassy in India, “Carrefour confirms its decision to enter the Indian market with cash-and-carry stores and confirms it is in the final round of negotiation to select an Indian franchisee partner for all other retail stores.”
The Embassy added that the company had short listed 3 companies for its joint venture in India and will be finalizing on its partner shortly. The company will be starting both retail businesses in the country in the second half of 2009. Top officials of Carrefour visiting as part of the French President Nicolas Sarkozy’s business delegation, visited India to finalize on its retail plans for India.
January 26, 2008
Source: The Economic Times
Reebok to expand lifestyle segment
Sportswear company Reebok will be expanding its lifestyle segment in an effort to maintain its leadership position in India. The branded sportswear segment in India is worth Rs. 1,700 crore and is one of the most competitive segments of the Indian retail sector. Reebok will be adding to its women’s wear portfolio and expanding its kids wear segment as well.
The company will also be launching premier sports apparel as well as footwear in the Indian market and expand its range in sports such as soccer. According to Subhinder Singh Prem, managing director of Reebok India, “India is an evolving market and what is true now may not be true in the future. We did not address the kids market two years ago. However, it is a huge opportunity now and threshold prices have risen. Moreover, parents want to be known by what their kids wear.”
Reebok is likely to launch its kids wear sports merchandise in department stores initially and open stand alone stores at a later stage. The company will be investing in soccer to improve Reebok’s brand awareness with children. Reebok will be increasing its stores from 580 to 750 by the end of 2008.
January 13, 2008
Source: Business Standard
South City shopping mall a big draw
The number of people visiting the South City shopping mall on Sundays has already hit the 75,000-mark, says Mr Sanjeev Mehra, Vice-President, Mall Operations. With the Spencer’s anchor store having opened recently — and the six-screen Fame multiplex scheduled to be operational soon — the footfall at South Kolkata’s newest shopping destination is all set to go up further.
Covering an area of more than a million sq ft, the South City mall on the Prince Anwar Shah Road is one of the largest shopping facilities the city has ever seen. It has more than 650,000 sq ft of retail space and over 134 retail outlets. “We are registering a footfall of over 20,000 on the weekdays. On Saturdays it is going up to 45,000, with the figure reaching its highest level on Sundays,” says Mr Mehra.
The Fame multiplex will be operational in another 10 days. Some other popular outlets such as Shopper’s Stop are all set to open soon, which will draw an even larger crowd. The mall has a nine-level car park that can accommodate almost 1, 350 vehicles.
February 4, 2008
Source: Hindu Businessline
Reliance Retail Ltd on Wednesday launched ‘Reliance Mart’, a hypermarket, at Reliance Greens, Motikhavdi in the Jamnagar district of Gujarat. Reliance Mart would also cater to the needs of the staff of the Reliance refinery.
Spread across 83,000 sq ft of shopping area, the new Mart will offer a range of over 35,000 products catering to the entire family. This is the second Reliance Mart to be launched in Gujarat.
February 1, 2008
Source: Hindu Businessline
Reliance Super opens in Gurgaon
Reliance Retail launched the second of its Minimart format stores called Reliance Super at the Mega Mall in Gurgaon. The company has successfully launched several formats such as Reliance Fresh, Reliance Trendz, Reliance Mart, Reliance Footprint, Reliance Digital, Reliance Wellness, Reliance Timeout and Reliance Jewels.
The store covers an area of 13,500 sq ft and carries a range of 10,000 products, in food and grocery, home care, apparel, accessories, FMCG, consumer durables, auto accessories, lifestyle, footwear and health and fitness products. The stores will also carry a range of Reliance’s own private labels and will offer services such as an alteration and a food and beverage counter.
At the launch of the Mini mart in Gurgaon, President and CEO (Operations and Strategy) of Reliance Retail, Raghu Pillai stated that, “The launch of Reliance Super is yet another step by Reliance Retail towards providing an international shopping experience to all our customers at unmatched affordability, guaranteed quality and choice of products and services. Reliance Super marks the achievement of another milestone in our effort to unleash a retail revolution in India.”
January 19, 2008
Source: DMA NewsDesk
Future Capital’s logistics fund slated for launch in March
The financial services company of the Future Group, Future Capital Holdings, will launch its logistics fund in March in a move that will help the group’s flagship company, Pantaloon Retail India Ltd, India’s largest listed retailer, and other retailers looking for modern storage infrastructure as they expand across the country.
The fund will invest between $700 million and $1 billion to set up warehouses across India’s seven key metros in two-three years. This investment vehicle will be the largest in Future Capital’s portfolio, which includes three other private equity funds. A hospitality fund is in the pipeline.
The fund will invest in setting up 18-22 million sq. ft of warehouse space across India. Pantaloon will likely be an anchor tenant at the warehouses, taking 10-25% of the portfolio.
Future Capital will list on the stock exchanges on Friday, weeks after its Rs4,900 crore initial public offering was subscribed 133 times.
February 1, 2008
Source: LiveMint
Concor to handle logistcs for Bharti-Wal-Mart
The Container Corporation of India (Concor) will be taking care of logistics for the Bharti-Wal-Mart joint venture. The company will reportedly be procuring and supplying fresh fruit to Bharti-Wal-Mart, and is also wanted to offer its services to other major retailers such as Subhiksha, Mother Dairy and Big Bazaar.
According to Suresh Kumar, Concor’s director for finance, “There is a huge consumer demand for fruit in the country, much of which is imported. So, there was a great business opportunity. When we evaluated the entire cost of starting this business, including setting up cold chains, it was found that returns could be pretty attractive.”
The company has already set up a central store near Sonepat, in Rai Harayana, with an investment of Rs. 92 crore. The store has a controlled atmosphere and is a modern version of a cold storage and enhances the life of fruits.
January 19, 2008
Source: The Economic Times
Luxury Brands offer more than just a brand
Luxury brands that offer something more than just the product itself stand out in the minds of customers. Some of the worlds best known luxury brands such as Zegna, Ferragamo, Lladro, Pal Zileri, Hugo Boss and many more are investing in relationship managers and offering personalized services to customers to ensure that customers are completely satisfied.
Luxury brands offer extra services such as in-house tailors for personalized fittings, fashion consultants to assist in shopping, previewing limited edition collections before they are unveiled to the public and other such services. These specialized services are paying off very well for the retailers, especially with Hugo Boss where 15% of sales come from its personal shopping service.
Lladro offers a cleaning and maintenance service for its customers who can call for the service any time. According to senior brand manager at Lladro India, Sachin Sharma, “We have received a tremendous response after implementing these services and as a result the team is booked throughout the year. Moreover, it has also helped us in generating more sales. Customers who used to pick-up their pieces from abroad are getting more convinced to make their purchases here.”
January 20, 2008
Source: The Economic Times
Tata’s consumer durable chain Croma, is looking to expand in north India after having opened stores in several cities in the south and western regions of India. The company currently has stores in Pune, Ahmedabad, Mumbai, Surat and Bangalore. The company plans to open 25 outlets across India by March and is concentrating on larger cities such as Bangalore, Delhi, Mumbai, Pune, and Ahmedabad and will then be opening in tier I cities such as Ludhiana, Chandigarh and Jalandhar.
January 23, 2008
Source: The Hindu Business Line
White goods sales increasing due to easy availability of finance
Consumers are enjoying the benefits of getting finance easily and are increasingly buying consumer durables such as LCDs, top end refrigerators, washing machines and assorted IT products. The rising cost of real estate is also leading to consumers to spending the money on white goods instead of investing it in a real estate purchase. The consumer durable segment in India is worth Rs. 25,000 crore and this holiday season it beat its own expectations.
According to Sukhpreet Singh, general manager of brand marketing for Whirlpool India, “The durables industry is seeing a gradual trend towards financing purchases, particularly at the entry-level and high-end products. Almost 20 per cent of home appliances sales come through financing options, but the number could be larger if we take into account unorganized financing too.”
Samsung saw a 30% increase in sales during the holiday period, of which finance schemes accounted for 30% of the sales of premium products, with average prices of Rs. 35,000. Last year, finance schemes accounted for 20% of sales during this same period. The increasing use and acceptance of credit cards among retailers and consumers alike is also a major reason for this increase in consumer durable spending.
January 02, 2008
Source: Business Standard
Consumers favour Net research for gadget buys
Gadget buffs in India are increasingly moving online to research their next consumer electronic products purchase, with an overwhelming 83 per cent of survey respondents citing the Net as their most-tapped resource for such buys.
According to the Microsoft Digital Advertising Solutions’ Consumer Electronics Survey, while vendor sites emerged as the most used resource, portals came second, followed by search engines, and product review Web sites.
The Internet was the preferred choice in India because consumers could find the latest available models (67 per cent) and compare product features (65 per cent), and prices (62 per cent) and because they could do this at any time (61 per cent). Interestingly, quality and price were the key criteria for purchasing consumer electronics, rather than the brand name.
Nearly 10,000 MSN/Windows Live service users were surveyed across 10 markets — Australia, China, Hong Kong, India, Japan, Malaysia, Singapore, South Korea, Taiwan and Thailand — in a poll conducted by Synovate during August to October 2007 for Microsoft Digital Advertising Solutions.
“Consumers in India, by nature, generally prefer to go by recommendations and today they have access to a lot more people and communities on the Internet for advice,” Mr Vineet Gupta – India Marketing Manager, Microsoft Digital Advertising Solutions, said.
Products most often researched by the respondents included mobile phones, laptop computers and digital cameras.
Laptops, mobile phones and MP3 players were among the top three preferred electronic products bought online by Indian users. The purchase decisions for electronics most often appeared to be influenced by children in the Indian households.
February 3, 2008
Source: Hindu Businessline
Reliance Fresh on Watch list by Orissa government
Reliance Fresh could be facing the same problems in Orissa that it did in Uttar Pradesh, as the state government has reportedly assured a delegation of India FDI Watch that it would scrutinize the permission given to Reliance Fresh to open outlets in the state again. According to Dharmendra Kumar, Director of India FDI Watch, “We have been assured by a senior state government official that all possible steps would be taken for the rehabilitation of roadside vendors. The permission given to Reliance Fresh for opening outlets would also be scrutinized.”
The India FDI Watch is an association of small traders that has been opposing the entry of large retail players. In the meantime, Orissa has offered roadside vendors a special zone for them to operate in. Reliance Fresh opened in the state last September and has faced difficulties since it’s start, with a lot of protests from local traders.
January 29, 2008
Source: The Economic Times
Catalogue-shopping a hit in metros
Big retailers seem to have hit upon a smart way to keep their cash register ringing by attracting customers through catalogue-shopping.
For the first time, Hypercity Retail India Ltd, along with Shoppers' Stop, has entered into a franchise agreement with the UK-based Home Retail Group, Argos, to offer multi-channel shopping experience to its customers. Hypercity Retail India would offer this facility under the brand name of Hypercity Argos.
"This unique format of catalogue shopping is definitely suited for metros like Mumbai where retail space is expensive and has been a deterrent for retailers to reach out to a larger consumer base in a cost-effective manner," Hypercity Retail's CEO, Andrew Levermore, said.
Hypercity Argos' integrated multi-channel capability encompassing stores, home shopping and the Internet, would provide consumers a new horizon to shopping, he said.
The firm has launched its business with five stores in Thane and would be opening more stores by the end of the first year, Levermore said.
February 3, 2008
Source: The Times of India
High realty costs make catalogue-shopping a hit
Following, Hypercity Retail India Ltd and Shoppers’ Stop; the Bombay Store, is also planning to provide catalogue shopping facility in the next few months.
“It is too early in India, although internationally, it is a well-known concept. It will definitely take-off in the coming years,” Bombay Store managing director Asim Dalal said. While he does not plan to launch catalogue-shopping immediately, he said, “We will be launching it in the next one year.”
However, Mukesh Ambani-led Reliance Retail said it has no immediate plans to launch this offering. “We at Reliance Retail are not planning catalogue- shopping in near future though it is a growing field. Major retailers should do well looking at the stupendous growth patterns,” said Manu Kapoor , head of Reliance Retail Corporate Communications.
Though nascent in India, the catalogue shopping segment is huge overseas. The US market is estimated at around $180 billion, while the European market is pegged at around e50 billion.
February 5, 2008
Source: Business Standard
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