Faizan Haider, The Economic Times
New Delhi, 5 December 2022
Shoppers Stop is planning to open a value format to attract consumers opting for lower priced brands such as Tata Zudio and Landmark Group’s Max, two officials privy to the launch said.
The idea is to open stores on ty to sustain and the lines of Zudio and Max and capture a larger market especially in smaller towns,” one of them said. “The first store, sizes anywhere between 7,000 8,000 square feet could open in the next three months.”
Shoppers Stop is foraying in to the mass-priced segment after three decades of selling premium apparel and lifestyle merchandise. Experts said India’s consumption structure has been skewed in the past over a narrow base of richer consumers accounting for a large chunk of the overall market. However, as the economy is broadening across many more cities and the impact is reaching further down the income ladder, the opportunity for value-formats and value-brands is expanding.
“Shoppers Stop’s competitors have demonstrated mixed success in the mass segment. and servicing this segment needs merchandising agility to respond to varying customer preferences across markets, as well as the financial ability to sustain and scale,” said Devangshu Dutta, founder of retail consulting firm Third Eyesight. “In the diversity of India’s market, scale alone isn’t enough to guarantee success.”
Shoppers Stop may open first few of its value format stores in tier 2 cities before taking them to metroci ties, people cited above said.
The company did not respond to the email query till press time on Sunday.
“The value format segment is growing and during Covid 19 we have seen consumption increasing in Tier-2 cities,” said Shriram PM Monga, cofounder at retail consultancy firm SRED.
“These cities also have grade A malls now, offering retailers quality space.” Tata Group firm Trent had earlier indicated that Westside accounts for 70% of its standalone business but Zudio, an affordable fast-fashion brand, has the potential to outpace the department chain due to the size of the opportunity in the value segment.
For Lifestyle International, its value brands Max and Easy Buy have already outpaced the department stores by sales – back in 2019 – indicating that consumers are increasingly seeking either lower-priced merchandise or opting for global brands such as Zara and H&M for fashion apparel instead of department stores.
Shoppers Stop has 296 stores spread across 3.8 million square feet, which include 91 department stores, 11 HomeStop home furnishing shops, 139 beauty stores, and 25 airport doors. It is on track to add 12 department stores and 15 beauty stores during this fiscal year.
According to Retailers Association of India (RAI), overall retail sales in October 2002 grew 15% year on year and by 19% when compared to pre- pandemic sales level (October 2019).
(Published in The Economic Times)