www.indiaretailing.com INDIA’S BEST SELLING MAGAZINE ON MODERN RETAIL AUGUST 2013 VOL. 12 NO.8 `100 ww w ww ww ww ww ww ww ww w w w w w w w w w .i .i .i .i .ind nd nd nd nd nd nd nd nd nd d dia ia ia ia ia ia a ia ia ia ia a ia a ia ia ia a ia ia ia ia ia ia ia a a a ia ia ia ia ia ia ia a a a ia ia a a ia ia a ia ia a ia a ia a ia a ia ia ia a a a ia r re r re re re r r r r r re re re re r r r r re r r re r r r r r r r r r r r r r r r r r ta ta ta ta ta a t il il il il il ilin in in in ing. g. g. g g. g. g. c c c c co co co om m m m m INDIA’S BEST SELLING MAGAZINE ON MODERN RETAIL AU AU UG G G G GU GU GU GU GU GU GU GU GU GU GU GU GU GU GU U GU GU GU U GU GU GU GU GU GU GU GU GU G GU U GU U U GU G G G G G GU G G G G G G G G G G ST ST ST ST ST ST ST T T T T T T T T T T T T T T T T T T T T T T T T T T T 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 201 0 01 01 013 3 3 3 3 3 V V V V V VOL OL OL OL OL OL OL L L. . 12 12 12 1 12 12 1 12 12 12 12 1 12 12 1 12 1 12 12 1 12 1 1 12 12 12 2 12 12 2 2 12 2 2 2 2 12 1 1 N N N N N N NO NO NO NO O N N N N N NO N .8 .8 .8 ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` ` 10 10 10 10 10 10 10 10 10 10 10 10 1 10 0 0 0 10 10 10 0 10 10 10 0 10 0 10 10 0 0 0 10 10 10 1 1 1 1 1 1 1 1 1 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ENTREPRENEUR Gaurav Saraf, Joint M D Square Foot Offering Innovative Floorings RETAIL EXCELLENCE Gurkirat Singh Khera Owner SNOWHITE with ‘Yes Man’ Success Mantra INSPIRATION RETAIL !!! Indian Entrepreneurs Inspired by the Magic of Retail Indian Entrepreneurs Inspired by the Magic of Retail
Indian EntrepreneursInspired by theMagic of Retail
Indian EntrepreneursInspired by the Magic of Retail
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Inspiration RetailRetail has inspired entrepreneurs all over the world and transformed shop-keeping to a modern scientifi c business. This special annual edition of Images Retail designed around this very theme “Inspiration Retail” features some of the brightest Indian entrepreneurs who were fi red by Retail’s fascinating power to infl uence consumer spending. Today, they might have limited presence, but yet, within their region, they have managed to win and retain fortress-strong customer bases, giving much heartache to any corporate majors wanting to enter their region.
We have also spoken with the second generation of entrepreneurs who had enough belief in the dreams of their fathers and forefathers to not only continue to be in the business of retail but also bring in the much needed change and accoutrements to retain competitiveness in the changing market dynamics. What is also interesting is how they have still remained true to their core principles and values. It was a rare delight for our team to interact with these retailers and realize that they do not fear the uncertainties in the business and rather get inspired from the majors. These master retailers share with us the dos and don’ts that form their business mantras, and the core of their continuing to be successful in all situations.
Images Retail continues to discover many progressive retailers and bring their insights, views, suggestions, and vision about Indian modern retail to show the path to the aspiring entrepreneurs. Our mission for next 12 months is to identify vibrant enterprises – businesses which had an appetite for fast pace growth and making a mark in the Indian retail industry. We would be happy to hear from our readers telling us about such retailers. They will have all our support in assessing the true worth of their concepts and presenting their stories to the potential partners.
The forthcoming India Retail Forum on 25th & 26th September will be just the right platform for them to be with the best minds in retail and it will be our endeavor to help them connecting with the right partners for business growth. Celebrating a decade of recognizing excellence in retail businesses, we at IMAGES are gearing up for the Grand Finale of the 10th anniversary congregation and we hope to see some of these retailers making it the glittering stage of the coveted “Images Retail Awards”.
AUGUST 2013 • PAGES 154 • VOL. 12 NO. 8
Editor in Chief Amitabh Taneja Editorial Director R S Roy Publisher S P Taneja
Editorial Assoc. Editor Rajeev Kumar Chief of Bureau (Bengaluru) Copy Editor Shipra Sehgal Correspondent (Bengaluru) Roshna Chandran
Manager-International Relations Noelia Piriz
Creatives Art Director Pawan Kumar Verma Dy. Art Director Deepak Verma Layout Designer Rakesh Kumar Sr. Photographer Vipin Kardam
In Conversation ..........................................138Promoting Fitness 24/7Dr Vikram and Srilekha Reddy of Snap Fitness, the health club chain from US, talks about their plans for the fi tness market in India
Technology .................................................144Serving Retail TechnologyWincor Nixdorf, a technology solution brand in retail, discusses its operation across the globe and its India plans
Entertainment ...........................................147“We create an experience that cannot be replicated at home”Gautam Dutta of PVR launched its fi rst bowling centre PVR BluO in 2009. He talks about the relevance of innovation and the key learning in the business
Case Study .................................................148Improving the Way Millions of Indian Customers Shop, Save, and Get RewardedDiscussion on the partnership between Payback India and Future Group to effectively implement the business philosophy for retaining the largest customer base. A look in the case study
Perspective ..................................................44Seven Principles of Highly Successful Retail BrandsLearn some basic practices adopted by the top retailers, which benefi ted them to drive retail success
Entrepreneur ...............................................50Offering Innovative FlooringsGaurav Saraf, Joint MD, Square Foot, elaborates on the company’s innovative solutions and concepts of fl ooring
Retail Excellence .........................................56Snowhite with ‘Yes Man’ Success MantraDelhi-based fashion apparel brand discusses their successful policies to run a multi-brand store
Market Research .......................................126On the HighIncreasing urbanisation, social acceptance, high intensity marketing and relaxation of import rules are favouring the growth of liquor market in India
Profi le ........................................................130Making Fashionistas the Accessories WayWith an initial investment of Rs 10 lakh, Ayesha Accessories clocked sales of over a crore in December last year and is mulling an international foray in Europe
Retail Concept ...........................................134Leading the PackRecently launched studio-cum-experience zone DIY Square houses wide range of tools for home, hobby and garden category. The brand is betting big on Indian territories
16 ............................... International Round Up22 .........................................National Updates 34 ..............................................New Openings151 ...........................Personality of the Month 152 ...........................................................Index
R EGULARS
Cover Courtesy: Reebok, New Jersey, USA | Design: Chute Gerdeman | Photo: Mark Steele
INSPIRATION FOR MANY, SAM WALTON FACED MANY CHALLENGES AND HURDLES BEFORE WAL-MART COULD BECOME THE WORLD’S LARGEST DEPARTMENT STORE AND SET A TREND FOR MANY TO FOLLOW. HAD HE GIVEN UP WHEN THE FIRST STORE HE SET UP AT NEWPORT HAD TO BE LEFT BEHIND JUST BECAUSE THE
LANDLORD REFUSED TO RENEW THE LEASE AGREEMENT, PERHAPS TODAY WAL-MART WOULD HAVE JUST BEEN CONFINED TO WALTON’S IMAGINATION OF MAKING IT BIG IN RETAIL. IN HIS BOOK “SAM WALTON – MADE IN AMERICA,” HE IS QUOTED SAYING: “AND OUR SUCCESS, IT TURNED
OUT, HAD ATTRACTED A LOT OF ATTENTION. MY LANDLORD,THE DEPARTMENT STORE OWNER, WAS SO IMPRESSED WITH OUR BEN FRANKLIN’S SUCCESS THAT HE DECIDED NOT TO RENEW OUR LEASE KNOWING WELL THAT WE HAD NOWHERE ELSE IN TOWN TO MOVE THE STORE. HE WANTED TO GIVE THE STORE TO HIS SON. I HAD NO ALTERNATIVE BUT TO GIVE IT UP. AFTER DOING EVERYTHING RIGHT, I WAS BEING KICKED OUT OF TOWN. IT IS NOT JUST A CORNY SAYING THAT YOU CAN MAKE A POSITIVE OUT OF MOST ANY NEGATIVE IF YOU WORK AT IT HARD ENOUGH. I HAVE ALWAYS THOUGHT OF PROBLEMS AS CHALLENGES, AND THIS ONE WASN’T ANY DIFFERENT. I HAD TO PICK MYSELF UP AND GET ON WITH IT, DO IT ALL OVER AGAIN, ONLY EVEN BETTER THIS TIME.”
When the I in Retail Stands for Inspiration
Cover Story 60
Capital isn’t scarce; vision is – Sam Walton
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perspective
44 . IMAGES RETAIL . AUGUST 2013
Principles of Highly Successful Retail Brands
SUCCESS DOESN’T ALWAYS COME WITH SHEER LUCK. FOLLOWING SOME BASIC PRACTICES THAT HAVE BEEN ADOPTED BY THE TOP
RETAILERS WILL ALWAYS BE BENEFICIAL FOR THOSE WHO WANT TO BE FAMOUS IN THE RETAIL INDUSTRY. HERE I UNVEIL THE SEVEN
SECRETS TO SUCCESS IN RETAILING
By Mani M Mani
11 CREATE THE DEMANDAll successful retailers have at least one item or product that their retail store is famous or stands for. That particular stuff need not bring any profi t, but they have one in order to succeed and be remembered. Think about it, currently one cannot make out any variation to make a retail brand unique because such demands are markets not in existence today, as seem to be known. Whenever such a demand is created, competition is rendered irrelevant as the rules of the game are re-defi ned. The known examples are I-pod and cirque du soleil.
In the world of retailing, Walgreens is one example. They are credited to have invented milk shakes and malted milk drinks in the 1930s. This
concoction was the outcome of the demand from most of the people during their lunch break looking for a light but energetic or nutritious beverage and in the same period the mixer-grinders were launched. This was a natural serendipity.
What is your innovative invention to create a new market and demand? Even if that is not going to contribute to a great degree to your revenues, you ought to have one if you are keen to build your retail brand for the long haul.
22 ASSOCIATIONJust like “The Bond - James Bond” is associated with certain images, icons, style statements, gizmos, cars and even rites and rituals, think carefully about the kind of associations that
would complement your retail brand and your target audience. Use all of them always and that too upfront. Because you do not have many options to build a distinctly different character and personality to your store brand, think of the Indian fi lm personalities. Each one brings a set of imageries, traits, attributes, values and so on.
Likewise, there is a need to treat your retail brand as a living personality with certain unique characteristics. Cognitive psychology says: “People – shoppers and customers – have a tendency to choose to identify themselves with such personalities to even shop among their desired peer group, too.” After all, majority of shopping is primarily encouraged by the leisure or surplus time one has at his discretion. So, make your retail brand attractive and interesting for your target audience to befriend it.
7By Mani M
SUS
REB
By Mani M7Perspective_By Mani M mani.indd 44 8/1/2013 7:30:50 PM
perspective
AUGUST 2013 . IMAGES RETAIL . 45
33DESIGN PARAMETERSFirst and foremost, the basic tenet of retail is to design experiences in the branded environments. Be minimalistic if you are in the premium segment or else please simplify whatever you are attempting to do in this visually polluted retail environment. The absence of the clutter would enable you to make the shoppers see what you would like them to see and carry in their mind and shopping basket.
Great experience is what everybody is seeking or expecting. Enhance specifi c values that express and represent values – common values to the buyer, which lead to memorable experiences. A smart retail designer should know that what is designed is not the space or interiors but experiences. The retailer and his designer should consciously script the kind of relevant experiences they would like their shoppers to carry with them, if the retail brand needs to stay on top of the mind of its customers. First of all put the customers in their comfort zone, while giving them unexpectedly pleasant surprises or WOWs. You do that and these “WOWs” would translate to the WOM (word-of-mouth) publicity.
For example, Giorgio Armani designs are epitome of simplistic minimalism, visiting Las Vegas is a wholesome experience with multitudes of surprise in an otherwise a desert or having the famous “hurricane” cocktail in Pat O’Briens in New Orleans, LA.
44 PEER GROUPShopping is predominantly a social intercourse for people, per se including your shoppers. Each of them while forming a group, a league or a tribe would choose to hang out with their peers. After having identifi ed themselves with the store brand’s personality, each of them would enjoy shopping amongst their group. The retailer and the brand strategist should remember this and orchestrate the right mix of experiences in their respective branded environments. One of my perennial observation and complaint is that no retail brand of India origin has any unique, special and distinct character, any which way. If at all there is any, that is far too subtle and much more is needed.
Social recognition and projection of status is a very common trait among the people from recently developed economies such as India. Make your retail brand so grandiose that your target audience should take pride in showing of the retail brand: from where they bought, whatever they may have. Social standing being very important, Indians judge others by looking at the brand, style and “X” factors of store brand; even the address of the store.
55 CHANGEEmbrace change and don’t be a lame. If you want to radically alter the product, market or system, you might as well come up with another brand,
Perspective_By Mani M mani.indd 45 8/1/2013 7:30:52 PM
retail excellence
56 . IMAGES RETAIL . AUGUST 2013
IN THE TIME OF RECESSION, WHEN MOST OF THE RETAILERS
WERE FINDING IT HARD TO RECOVER THE RUNNING
COST, THERE IS ONE SHOP IN DELHI AT CONNAUGHT PLACE NAMED SNOWHITE APPARELS THAT REMAINS UNAFFECTED. GURKIRAT SINGH KHERA AND
HIS DEDICATED TEAM OF 60 EMPLOYEES IN THE STORE CLAIM TO HAVE CREATED A
MAGICAL EXPERIENCE IN THE OUTLET WITH THEIR SELLING
SKILLS, MERCHANDISE MIX AND COMMITTED RELATIONS WITH
THEIR CUSTOMERS TO CHURN AN ANNUAL TURNOVER OF
AROUND `30 CRORE FROM THIS SINGLE STORE. AVINDER BATRA TALKS TO THE TEAM TO UNVEIL
THE LONG JOURNEY OF THE STORE AND OVERWHELMING
RESPONSE FROM THE CUSTOMERS EVEN IN HARD
TIMES.
Spread across 6,000 sq.ft., Snowhite Apparels is a family store on the busy street of Connaught Place, New Delhi. What is worth noticing is the ease and effectiveness with which each customer is serviced by the sale attendants. Claiming to be one of the oldest retailers in the city, the company started their business in 1928 as dry cleaners. In 1958, they began to manufacture their own shirts and trousers. Today, apart from selling various other brands such as Louis Philippe, Van Heusen, Allen Solly, Arrow, Givo, Wills Lifestyle, Park Avenue, Adidas, Lee, Octave, and Puma, they also stock their private label brand “Snowhite” and supply
shirts and trousers to commercial institutions such as corporates, banks and hotels. The company sells 1.5 lakh shirts from its stores every year.
PIONEERING THE CONCEPT OF ‘MBO’Snowhite Apparels claims to have introduced the concept of MBO (multi-brand outlet) in fashion, followed by many others in Delhi and then all over the country at a large scale. “We always had in mind that such a format will change the concept of shopping in the coming years. Today sitting in CP, the main hub of fashion, we observe fashion everyday and come out with new ideas to implement them in our store,” says
Vijay Malhotra who is associated with Snowhite for last 36 years.
The company has been selling men’s formal wear since 1958 and were the pioneers in stocking every new formal fashion brands in their store; in 1988, United Colors of Benetton was introduced, Van Heusen in 1991, Reebok in 1994-95, Allen Solly in 1995, and so on. It was around the year 2000 when fashion brands entered the Indian market at a comprehensive level. Today, nearly after 12 years, fashion brands have swept the Indian markets by storm. The fashion industry has seen drastic change and today all outlets store merchandise in vogue to meet the expectations of the customers.
RETAIL PRESENCESnowhite Apparels currently has eight stores, four in New Delhi (one each in CP and Rajouri Garden and two in Karol Bagh), three in UP and one at Shimla. According to the company offi cials, the retailer prefers to do business on its owned property as it saves major portion of the running cost in the form of rentals.
Commenting about not expanding on national level, Malhotra says: “In today’s fi ercely competitive scenario, most of the brands are loss making on retail front even though they have national presence. It is a challenge to earn profi ts on store-to-store basis.”
CP STORE: ROLE MODEL FOR MANYSnowhite Apparels at CP has introduced the latest fashion brands from the times they have been launched in India. According to
the Indian customers, the store is changing the way of shopping. “The company’s sales fi gures are so impressive that the competitors conduct surveys to understand our business format. We can make out that they are not buyers but have come to examine our business model for reference,” reveals Malhotra.
The CP outlet offers regular items for men, women and kids such as formal shirts, casual wear, belts, ties, innerwear, ethnic wear, turbans,
stoles, moujaries, and suits. While the ground fl oor is all dedicated to menswear category, displaying 40-45 popular brands, women wear and kidswear section is on the fi rst fl oor.
SALES ATTENDANTS: THE DRIVING FORCEUsually retailers invest in location, product mix, design of the store, visual merchandising, etc., but they do very little on grooming the front staff and their requirements. At
Snowhite, rewards and commissions of up to `15,000 and above are given to each employee on the basis of their monthly performance. Revenue sharing is a must with the bottom staff who drive the sales. This important force is never ignored by the retailer. When bigger/national retailers are dealing with the challenges of high attrition rate at front level, Snowhite has set an example for its competitors in the retail industry by retaining its sales staff for around 40 years.
HIGH STREET VS MALLAccording to Malhotra, every high street has its own USP, whereas a mall has one or very few shops of that kind. Mall culture still lags behind high streets in terms of sale during weekdays. “It will take another 20-25 years for Indians to do serious shopping from malls,” feels Malhotra.
Further, shopping centres have 80 percent shops of apparels offering 70-80 percent sales discounts competing with each other, leaving no room to earn margins. Usually a retailer in MBO would get a margin of 25-30 percent on the MRP cost. “We give minimum sales discounts and still sell all our brands due to reasonable prices offered.”
CHECKING FASHION ON DAILY BASISBeing in the fashion industry, it is imperative to do consistent scrutiny of the selling pattern of the brands in the store and the new launches in the Indian market. The team is always on a lookout for any new brand missing in their store. “We check every new brand on the basis of popularity. It is the need of the time that we stock all popular brands in our stores . Thus, choosing from among the brands falling almost on the same price scale makes buying easier for one or the other piece. Further, through consistent sales analysis, we make sure that the stock is sold within the time period and does not accumulate in dead stock,“ informs Malhotra.
There is almost negligible dead stock of around `1 lakh every six months, which is also returned under the agreement with the companies.
MERCHANDISE SELECTION: UNPARALLELED EXPERIENCEMalhotra has been buying merchandise for Snowhite for almost 20 years. He spends atleast two hours everday sitting on the sales counter and tracking the sales of every brand and design patterns that are making a move from the shelves. “This helps in noticing the buying pattern of today’s customers. On those basis, we make the choice of the best merchandise of any brand which is kept in their EBOs. We try to accommodate the merchandise which is 70 percent saleable in their stores,”
THE COMPANY PREFERS TO DO BUSINESS ON ITS OWNED PROPERTY AS IT SAVES MAJOR PORTION OF THE RUNNING COST IN THE FORM OF RENTALS
So, what is the lesson here? Walton’s story is all about passion and inspiration. It is about wanting to swim against the tide and still not grinning and complaining about the odds. Making it big without any formal training or handholding of any large corporate, Walton’s story resonates with the stories of many retailers in India who have managed to create a niche for themselves in wake of strife competition they face day in and day out from the corporate and multinationals. Take the example of the fi rst department store in India “Akbarally’s,” inception of which dates back to 1897, a store that garnets a century of trust with loads of innovations added early on when the market for organised retail was not even conceived. Today, on a revamp stage, the oldest department store of the country is gearing up to stand shoulder to shoulder with other national department store chains and revive its legacy of setting new trends in the market. In the words of Late Fakhruddin T Khorakiwala in one of his interviews with IMAGES Retail, he had shared: “Till 1992, we had absolutely no competition. It was considered to be a status symbol to shop at Akbarally’s. With the mall culture setting in, we slowly lost our popularity. The younger population today does not remember Akbarally’s; they are more inclined towards shopping at malls because of the ambience and also the variety offered.
Sam Walton, Wal-mart
in Retail Stands for Inspiration
When the
Capital isn’t scarce; vision is – Sam Walton
By Zainab Morbiwala
INSPIRATION FOR MANY, SAM WALTON FACED MANY CHALLENGES AND HURDLES BEFORE WAL-MART COULD BECOME THE WORLD’S LARGEST DEPARTMENT STORE AND SET A TREND FOR MANY TO FOLLOW. HAD HE GIVEN UP WHEN THE FIRST STORE HE SET UP AT NEWPORT HAD TO BE LEFT BEHIND JUST BECAUSE THE LANDLORD REFUSED TO RENEW THE LEASE AGREEMENT, PERHAPS TODAY WAL-MART WOULD HAVE JUST BEEN CONFINED TO WALTON’S IMAGINATION OF MAKING IT BIG IN RETAIL. IN HIS BOOK “SAM WALTON – MADE IN AMERICA,” HE IS QUOTED SAYING: “AND OUR SUCCESS, IT TURNED OUT, HAD ATTRACTED A LOT OF ATTENTION. MY LANDLORD, THE DEPARTMENT STORE OWNER, WAS SO IMPRESSED WITH OUR BEN FRANKLIN’S SUCCESS THAT HE DECIDED NOT TO RENEW OUR LEASE KNOWING WELL THAT WE HAD NOWHERE ELSE IN TOWN TO MOVE THE STORE. HE DID OFFER TO BUY THE FRANCHISE, FIXTURES, AND INVENTORY AT A FAIR PRICE; HE WANTED TO GIVE THE STORE TO HIS SON. I HAD NO ALTERNATIVE BUT TO GIVE IT UP. IT WAS LOW POINT OF MY BUSINESS. AFTER DOING EVERYTHING RIGHT, I WAS BEING KICKED OUT OF TOWN. IT IS NOT JUST A CORNY SAYING THAT YOU CAN MAKE A POSITIVE OUT OF MOST ANY NEGATIVE IF YOU WORK AT IT HARD ENOUGH. I HAVE ALWAYS THOUGHT OF PROBLEMS AS CHALLENGES, AND THIS ONE WASN’T ANY DIFFERENT. I HAD TO PICK MYSELF UP AND GET ON WITH IT, DO IT ALL OVER AGAIN, ONLY EVEN BETTER THIS TIME.”
In 1945, Sam Walton started a Ben Franklin franchise store in Newport, Ark and founded Walmart in 1962 at Rogers, Arkansas, United States. Walmart, a multinational retail corporation that runs chains of large discount department stores and warehouse stores, grew into the world’s largest company in 2002. Its mission is to help people around the world save money and live better -- anytime and anywhere – in retail stores, online and through their mobile devices. Each week, more than 245 million customers, and members visit their 10,800 stores under 69 banners in 27 countries and e-commerce websites in 10 countries. With fiscal year 2013 sales of approximately $466 billion it is today amongst the world’s three largest companies. Walmart is also the world’s largest private employer with 2.2 million associates worldwide.
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cover story
AUGUST 2013 . IMAGES RETAIL . 61
Expansion for us took a backseat simply because I was running short of human resources.” But today, with the young and dynamic Huzefa Khorakiwala taking charge, we shall soon see the name yet again afresh on the mind of its patrons.
The concept of electronic chain stores in the country is not copied from the West and nor is it fair to state that it was only post the entry of big corporate houses such as Future Group and Reliance that we saw the mushrooming of the likes of Vijay Sales, Kohinoor Electronic, etc. Being technologically advanced is synonymous with being “modern.” And unfortunately the term “modern” today implies some kind of association with the West. But what if we were to say that one of India’s largest electronics chains happens to be a complete “made in India” brand? At some point of time, majority of us have been compelled to make a visit to Vijay Sales to check the latest in phones and electrical appliances. But not many know that the foundation of this store was laid way back in 1967 when the concept of television wasn’t that prevalent forget advent of any other modern electronics that we are so used to of using today. In a media interview, Nilesh Gupta, Managing Partner, Vijay Sales, had shared that the fi rst Vijay Sales was opened by his grandfather Nanu Gupta, at Mahim in 1967 and it was just a 200 sq.ft. shop that specialised in selling black and white television sets. The second store came into inception only in 1986. Till 2001–2002, the brand was just present in Mumbai with about 15-20 stores and it was post the rapid expansions being undertaken by the recently entered MNCs that Vijay Sales too geared up to spread its wings. The fi rst Vijay Sales store outside Mumbai was opened in Surat in 2002 followed by Pune outlet in 2004. Today, the company has a strong base of customers not only in Mumbai but also in Ahmedabad, Delhi, Haryana and UP. What led to their success was their innate ability to keep their ears to the ground and keeping the dynamics of a particular region in mind before beginning operations. Another aspect that has kept them attaining the
top position is maintaining a strict business model when it comes to expansion and not getting lured by the easy route of opting for expansion through the franchise mode.
With just 65 stores, majority being in Maharashtra, Avenue Supermarts’ supermarket and hypermarket chain D-Mart today stands very much close with retail giants such as Future Retail and Reliance Retail in terms of turnover. The Mumbai-based supermarket chain D-Mart made a topline of `3,350 core in 2012-2013, whereas Future Retail clocked in `14,201 crore form its 1,000 odd stores and Reliance Retail clocked a turnover of `10,800 crore from its 1,450 stores. Again, the birth of D-Mart which was in 2000 by R K Damani was led by a vision to excel in its area of operation step by step rather than pumping in money for an all out expansion to make it big nationally. Today, present in Gujarat, Andhra Pradesh and Karnataka along with a strong presence in Maharashtra, the chain has managed to be profi table and clock huge turnovers primarily because it chose to expand on turfs where it could afford to buy a property rather than cough up heavy rents. Another thing D-Mart did differently was refraining from opening up at malls, thus saving on various overhead charges such as CAM that add to the rental cost. Out of all its stores, only 10 are on rent and again if the company doesn’t see the store making profi t in 2-3 years of its operation, they do not shy away from shutting shop there.
From being considered “mere dukandari” to witnessing the interest of international chains such as Wal-Mart and Carrefour, retail in India has grown multifold since last decade or so. It is estimated that the size of retail in the country will be close to 1.3 trillion in 2020, out of which almost 30 percent shall be contributed by modern retail. This is proof enough that we are yet to witness a lot many entrepreneur-driven enterprises in retail where the core driver will be that of “inspiration” and “passion.” Little wonder, it is only apt for us then that we dedicate our 2013 annual issue of IMAGES Retail on individual retailers who have dared to listen to
their hearts and set an example and inspiration for many to follow. The theme for this issue’s cover story is “Inspiration Retail,” wherein we have aimed to bring before you some of the brightest entrepreneurs in India who got inspired by retail’s fascinating power to infl uence consumer spending and have ventured into the crazy world of retail. Today, they might just have their presence through one store or a maximum of two or three stores, but yet, within their region, they have managed to win such a strong customer base that they give tough competition to any corporate houses wanting to enter their region. The case of Jalans at Varanasi is the best example here.
We have also spoken with the second generation of entrepreneurs who had enough belief in the dreams of their fathers and forefathers to not only be in the business of retail but also bring in the much-needed change to be at par with the changing market dynamics yet remaining true to the principles and values of their group. Accentuating this would be the story of The Bombay Store, Natural’s Ice Cream, Society Stores in Mumbai, etc. It was delight to interact with these retailers and realise that they do not fear the uncertainties in the business and continue to get inspired from the evolving scenario. These master retailers have shared what it takes to become successful in retail business.
As a country, India has always been entrepreneurial - right from the street vendor and the so-called “mom-and-pop” small grocery stores run by individuals or families to the corporate bigwigs like Future Group and Reliance. Modern retail in India has nurtured the dreams of many entrepreneurs, inspired by figures like Mukesh Ambani and Rakesh Biyani, by offering them bountiful growth opportunities to enter new formats, categories and markets. These are very much visible with the likes of Vijay Sales, D-Mart, The Bombay Store, Naturals Ice Cream, Kalyan Jewellers and Joyalukkas who have perfectly exploited the opportunities offered by the nascent Indian market and have managed to create a niche for themselves in the face of stiff competition from both the corporate and multi-nationals.
Cover Story.indd 61 8/1/2013 8:12:54 PM
130 . IMAGES RETAIL . AUGUST 2013
STARTED IN 2010 BY THE MOTHER-DAUGHTER DUO JACQUELINE AND AYESHA KAPUR AS A LITTLE
CORNER AT DEPARTMENT STORE CASABLANCA WITH AN INITIAL INVESTMENT OF `10 LAKH,
AYESHA ACCESSORIES CLOCKED SALES OF OVER A CRORE IN DECEMBER LAST YEAR AND IS MULLING
AN INTERNATIONAL FORAY IN EUROPE
By Tripti Bisht
The accessories are designed by Ayesha Kapur (Face and Co-founder of the brand who is mostly involved in trend research since she is in the US), Jacqueline Kapur, and Jyotis Feraud (French designer and stylist).
STORE EXPANSIONAyesha follows a slow-and-steady approach for expansion to ensure that its initial foray into the fashion accessories market is on the right foot. So far it has been opening usually 5-10 stores every year. With an aggressive expansion strategy, it plans to have 100 stores in next 3 years. Almost 50-60 percent of the upcoming stores will be in MBOs. An individual Ayesha store draws an investment of `25 lakh. The brand plans to further increase its presence in metros and tier II and III cities preferably in malls. Some of the new stores of Ayesha will come up at Raipur (City Centre mall); Thane (Viva City); Bhandup West, Mumbai (Neptune Magnet mall); and at Cochin, Ahmedabad and Pune (Central). The current sales ratio of Ayesha stores in metros and tier II and III is 9:4. In the next six months, six to seven MBOs are planned.
The new stores will come up based on the upcoming malls, identifi cation of new cities, and new tie-ups with shop-in-shops. Footfalls at the
Accessories Way
FILLING THE VOIDAyesha Accessories was founded to fi ll the large void in fashion accessories for young Indian girls. Growing from just an idea over the dinner table between Jacqueline and Ayesha Kapur, the brand recorded a revenue of `10 crore last fi scal. Jacqueline Kapur, MD and Co-Founder, Ayesha Accessories, opened Casablanca in 1999 which became a platform to launch Ayesha Accessories 11 years later.
“Ayesha is an inspiration for me and my daughter that grew out of the fun we have shopping for accessories. As a teenager, my daughter kept splurging all over the world with me, except in India since no ‘girls have fun’ things were available, even though the country has more young girls than anywhere in the world. That’s how the idea of designing and creating an accessory brand for young girls and women started over the dinner table. Moreover, the accessory market in India is very large, relevant to youth, and mostly unorganised. There are no serious players addressing the youth,” says the senior Kapur.
FOOTPRINT AND MARKET SHAREOf the total fashion jewellery and accessories market, only about 5
percent players including Ayesha Accessories fall in the branded segment at present. The brand currently has 42 stores; 28 EBOs and 14 MBOs across the country. It’s growing at a CAGR of 42 percent with a year-on-year sales growth rate of 30 percent.
PRODUCT PORTFOLIOAyesha Accessories offers fashion products such as ear and neck pieces, rings, bracelets, bangles, anklets, wrist bands, hair accessories, sunglasses, watches, hats and caps, bags – backpacks, travel pouches, sling bags, laptop sleeves, scarves, key chains, glitter pens, and shoe laces priced between `98 and `1,190. Ear and neckpieces, rings, bracelets, and bangles priced between `298 and `798 are the most popular among customers.
Ayesha has recently launched a new men’s line called “Unknown” to bridge the gap in the male accessories market, which targets young men. The sub-brand offers items such as rugged leather neckpieces, key chains, bracelets, wallet chains, laptop sleeves, and scarves. Currently, Unknown is retailed at Ayesha stores. Going forward, the brand plans to increase the collection and dedicate a wall unit to it.
