Shoppers Stop to add 12 new stores in FY23; focuses on private labels

Source: Financial Express, 05 July 2022

Retail chain Shoppers Stop Ltd has plans to launch 12 new stores in FY23, primarily in tier-2 and tier-3 cities, and will continue to invest in store renovations.

Shoppers Stop plans to increase the share of new and refurbished stores to over 50 per cent in FY23, said the latest annual report of the company.

The company will also continue to invest in its private labels, including celebrity endorsements.

Shoppers Stop is investing in the new-age technology and is backing its data analytics project Jarvis to maximise its understanding of customer behaviour and preferences.

“Project Jarvis, a massive data lake and analytics project, will significantly improve our overall analytical capabilities, enabling us to get ‘closer’ to our customers through the use of a propensity model and better mining of behavioural data and preferences,” the report said.

This can then be translated into much more effective marketing and product recommendations, leading to greater customer accretion and stickiness.

“We are enhancing the supply chain function through an automatic inventory replenishment system that can trigger customer-centric product assortments to optimise sales,” it said.

Shoppers Stop revenue for the financial year ended on March 31, 2022 was at Rs 3,111 crore, and the company was operating 88 stores that contributed 86 per cent of its sales.

“We have planned the launch of 12 new stores in FY23, primarily in tier-2 and tier-3 cities, and will continue to invest in store renovations, which have a typical payback of about 3 years,” it said.

Its omni-channel play is growing stronger with increasing digital sales, while offline sales are improving with increased coverage.

“Our omni-channel transformation has been very well-timed and our aim is to replicate the captivating in-store browsing experience with an array of categories and brands across all the channels,” said Shoppers Stop MD & CEO Venu Nair while addressing its shareholders.

Besides, the K N Raheja group firm will also continue to invest in its private labels which continue to be a strong focus area for the company.

“Kashish, Life and Fratini have grown to become power brands and we will continue investing to market them further, including celebrity endorsements,” said Shoppers Stop.

In FY22, Shoppers Stop’s 16 private labels accounted for 14 per cent of sales.

“In beauty, we are planning to introduce more products in the make-up, skincare and fragrance categories,” said Shoppers Stop, adding: “The growth in private label sales will also see a boost with our expansion in tier-2 and tier-3 cities, which usually witnesses higher sales of private labels due to our strong value proposition.” According to Shoppers Stop, it is the largest offline retailer of beauty products in India.

“We are expanding our omni-channel presence with the launch of standalone SSBeauty stores and SSBeauty online in FY23, catering to a diverse customer base — from teenagers to women in their late 40s.

Besides, Shoppers Stop is also unlocking a diverse and more powerful workforce and is continuously working towards the inclusion of employees from different backgrounds.

“Currently, around 1 per cent of our team are persons with disabilities and LGBTQIA+ community, and we are planning to increase this to 2 per cent by the end of FY23,” said Shoppers Stop non-executive chairman B S Nagesh.

Zara logs over 61 pc growth in India revenue to Rs 1,815 cr in FY22; posts profit of Rs 148.76 cr

Source: Financial Express, 12 June 2022

Spain’s Inditex, which owns luxury fashion brand Zara, posted a net profit of Rs 148.76 crore and revenue of Rs 1,815 crore for the financial year ended on March 31, 2022, according to the latest annual report of Trent Ltd. In FY21, Inditex Trent Retail India Private Ltd (ITRIPL), a JV which is engaged in the operation of Zara stores in India, had reported a net loss of Rs 41 crore and its revenue fell 28.3 per cent to Rs 1,126 crore in the pandemic impacted year.

The Inditex group of Spain owns 51 per cent while Trent has 49 per cent in ITRIPL. “During the year under review, the Zara entity recorded revenues of Rs 1,815 crore,” said the annual report of Tata group retail arm Trent. The entity for Zara currently operates 21 stores across 11 cities. There has been no increase in the number of stores in the last two years.

“The incremental store openings for Zara continue to be calibrated with focus on presence only in very high-quality retail spaces,” it said.

Zara competes with the likes of other foreign brands such as H&M, and UNIQLO in India. Inditex group of Spain has another similar association with Trent, which operates Massimo Dutti stores in India. It has also reported revenue growth of 43.9 per cent during FY22.

“The entity for Massimo Dutti operates 3 stores and recorded revenues of Rs 59 crore in FY22,” it said.

Massimo Dutti India Pvt Ltd had reported a profit of Rs 1.48 crore in FY22. The business of both entities is essentially limited to the distribution of Zara and Massimo Dutti products in India. Both entities are required to source merchandise only from the Inditex Group.

“Also, the choice of product and related specifications are at the latter’s discretion. Further, the entities are dependent on the Inditex group for permissions to use the said brands in India subject to its terms and specifications,” said Trent.

Retail businesses grow 23 pc in April: Retailers Association of India

Source: Financial Express, 13 May 2022

Retail businesses across India grew 23 percent in April this year in terms of sales as compared to pre-pandemic levels of the same month in 2019 with customers coming back to stores, as per industry body RAI.

According to the latest survey by Retailers Association of India (RAI), retail businesses across regions grew in April 2022 with sales in North India rising 32 percent, West India (24 percent), East India and South India (18 percent growth each) in comparison to the pre-pandemic sales level in April 2019.

“It is heartening to see that customers are back in the stores, shopping and retailers are witnessing quantity growth in sales,” RAI CEO Kumar Rajagopalan said.
In terms of categories, the quick service restaurant segment grew the highest at 45 percent in April 2022 over the corresponding period of 2019, followed by consumer durables and electronics at 26 percent.

Apparel and clothing, and sports goods categories grew by 23 percent each, while footwear rose by 22 percent, as per RAI.
Food and grocery segment witnessed a growth of 15 percent and jewellery also saw a rise of 8 percent in April this year compared to the same month of 2019.
However, the beauty, wellness and personal care segment is yet to recover to pre-pandemic levels. It registered a decline of 1 percent in the period under review as against April 2019.

Rajagopalan, however, said, “While most of the categories have shown good performance, it is important to note that about 10 percent of this growth can be accounted to inflation. We do hope that this continues since the headwinds, thanks to inflation, could act as a dampener for the upward trajectory.”

Amazon India’s strong smartphone business growth in 2021 driven by tier 2, 3 towns: Company official

Source: Economic Times, 23 May 2022

Amazon India’s smartphone business grew 30% in 2021, nearly double that of 2020, driven by customers in small towns who are choosing premium smartphones above Rs 20,000, a top company official said.

Signalling changing consumer trends post pandemic, Nishant Sardana, category leader, smartphones and accessories at the ecommerce major, told ET that the growth in units in 2021 was led by mid-premium smartphones in the Rs 20,000-30,000 and Rs 30,000-Rs 50,000 segment, which saw more than 50% on-year growth, driven by post-Covid requirement for high-performance smartphones.

“Over the last year, we have seen customers gravitate towards smartphones which are ideal for multitasking, which can manage work, entertainment, and day-to-day use cases as well,” Sardana said. He added that customers are opting for performance-centric smartphones with a better processor and larger RAM.

“Display-size, refresh rates will continue to be an ongoing battle,” he said. Speaking about the smartphone market’s premiumisation trend, Sardana said the install base of approximately 50-60 million smartphones in the price band of Rs 5,000-10,000 bought in the past 3-4 years now want a better experience.

“They want more from their smartphones—consuming OTT content, play games, but they realise what I have today is not sufficient, I need to upgrade to a better experience, and that’s where we are seeing the premium above Rs 20,000 with 5G support doing very well,” Sardana said. Small-town customers in tier 2 and tier 3 cities have contributed to 70% of smartphone purchases, which is three times more than tier 1 cities.

Three out of four smartphones, sold on Amazon India, are being purchased by customers from tier 2 cities and towns, reflecting the demand from small towns, Sardana said. Market trackers are also seeing a similar transition to digital platforms, especially in smaller towns.

Counterpoint Research in December 2021 reported that beyond being a safer, and sometimes the only alternative to Covid-19 hit-offline retail stores, special offers, a wide variety of choice and pricing were the primary reasons for customers to prefer online channels for smartphone purchases.

“Reverse migration of knowledge workers from big cities to smaller cities played a key role in popularising online channels,” the report said. Amazon India is also seeing an uptick in 5G smartphones since 2021, thanks to growing awareness about the next gen networks, with the marketplace adding a special section of 5G smartphones to cater to the demand. Recently, the marketplace has come up with the Amazon Inspire programme, an information hub containing reviews, unboxing videos, and other  product-related content, that goes live on the first day of the sale. “This will help the customers not only maximise their savings but also win phones and coupons by engaging in games and participating in quizzes,” Sardana said.

Lulu Group to invest Rs 2,000 crore in malls, hypermarkets in Karnataka

Source: Economic Times, 23 May 2022

UAE-headquartered Lulu Group on Monday signed an MoU with the State Government proposing to invest about Rs 2000 crore in setting up four shopping malls and hypermarkets and food processing units for agri exports.

The investment will commence from this financial year itself, according to the MoU signed by Additional Chief Secretary (Industries) EV Ramana Reddy and Lulu director AV Ananth Ram in the presence of chief minister Basavaraj Bommai and Lulu Group chairman MA Yusuff Ali at Davos.

Industries Minister Murugesh Nirani and IT/BT Minister CN Ashwath Narayan too are with the CM, taking part in the world economic forum (WEF) at Davos.

The Lulu investment is projected to add about 10,000 jobs, according to the company.

Lulu is the largest retailer in the Middle East, and the group company Fair Exports, has rice, fruits, vegetables, spices, and other items in its export portfolio and has offices in Delhi, Maharashtra, Karnataka, Tamil Nadu, and Kerala.

UAE-based retail major Lulu Groupto invest Rs 3,500 crore in Tamil Nadu

Source: Economic Times, 29 March 2022

UAE-based retail major Lulu group on Monday announced an investment of Rs 3,500 crore in Tamil Nadu to set up shopping malls, hypermarkets and a food-logistic park. A memorandum of understanding (MoU) to this effect was signed on Monday by Pooja Kulkarni, Managing Director and CEO of Tamil Nadu Industrial Guidance & Export Promotion Bureau and Ashraf Ali MA, Executive Director of Lulu Group, the company said in a statement.

The MoU was signed in the presence of Tamil Nadu Chief Minister MK Stalin; Industry Minister Thangam Thenarasu; Yusuffali MA, Chairman of Lulu Group; other officials and dignitaries at the Abu Dhabi Chamber of Commerce HO in Abu Dhabi. 

As per the MoU, the first shopping mall will come up in Chennai by 2024, while the first hypermarket is expected to open by this year-end itself at the Laxmi Mills compound in Coimbatore. 

Lulu Group will also set up food processing and logistics centres for procuring and processing agri-produce for exports to middle eastern countries. 

A high-level delegation from Lulu will soon visit the state to finalise locations and related formalities. 

“State of Tamil Nadu provides excellent infrastructure and support to the investors and we are very happy to explore bigger investment opportunities not only in Chennai but also in tier two cities such as Coimbatore, Salem, Madurai, Trichy.

“Our aim is to provide more than 15,000 direct and indirect job opportunities to Tamil youth in the next 3 years,” Yusuff Ali said.

Lulu Group currently operates more than 225 hypermarkets and shopping malls in the Middle East, Egypt, Indonesia, Malaysia and India.

The group employs more than 57,000 people globally.

Lulu Group has announced an investment of Rs 2,000 crore near Ahmedabad to set up a modern shopping mall.

It has committed an investment of Rs 500 crore to set up a food processing plant in Greater Noida, Uttar Pradesh. 

In India, Lulu Group already has four operational shopping malls in Kochi, Thrissur, Trivandrum and Bengaluru. 

The mall at Bengaluru is not owned by the Lulu group but it is managing and operating the property.

The group’s business portfolio ranges from hypermarket operations to shopping mall development, manufacturing and trading of goods, food processing plants, wholesale distribution, hospitality assets and real estate development.

Amazon to open largest office space in Tamil Nadu for 6,000 employees

Source: Economic Times, 30 March 2022

Chennai: Amazon on Tuesday opened its largest office in Tamil Nadu at an 18-floor facility in Chennai which will house 6,000 employees across teams like Amazon Web Services, customer support, technology, engineering and with a special focus on R&D work relating to Amazon’s devices including Echo.

The new office marks Amazon’s fourth office in Tamil Nadu and will take the company’s total office area in Tamil Nadu to over 21 lakh square feet. The company has four fulfilment centres and three sort centres. In 2021, Amazon set up its first devices manufacturing unit in India in Chennai and now, the company said hundreds of thousands of Fire TV Stick devices are manufactured in the facility.

“We are committed to create 20 lakh jobs, direct and indirect across the country by the year 2025,” Vinod Mathews, Director, Global Real Estate & Facilities, Amazon said. “The new office marks Amazon’s fourth office in Tamil Nadu reiterating our commitment to the state and the region. This new office is to further strengthen our presence and participation by supporting the country’s growth, creating employment opportunities and investing with a long term horizon.”

He said that Amazon first began operations in Tamil Nadu with close to 50 people based in Chennai in the year of 2005. Today, with over 14,000 employees in the state, Tamil Nadu has emerged as a significant location for the company’s people and business strategy.

The office was inaugurated by the Chief Minister of Tamil Nadu MK Stalin. “We believe that the launch of Amazon’s new office in Chennai will have a multiplier effect on the state economy. The expansion and investment will bind both the economic and social well-being of the state. We look forward to further investments by Amazon in Tamil Nadu focused on job creation and infrastructure expansion,” Stalin said in a statement.

Mano Thangaraj, Minister of IT, Government of Tamil Nadu, Neeraj Mittal, Secretary, Department of IT, Government of Tamil Nadu and other senior officials from the state government were also present at the event.

E-commerce companies log $2.7bn in sales in 1st 4 days of festive sale: RedSeer

Source: Economic Times, 09 October 2021

E-commerce platforms, including social commerce and grocery, garnered about USD 2.7 billion in sales in the first four days of the festive sale and are on track to achieve the USD 4.8 billion gross GMV mark, consulting firm RedSeer said on Saturday.

RedSeer Consulting had last month forecast that online platforms would see 30 percent year-on-year growth in gross GMV at USD 4.8 billion during the first week of festive sale. These platforms are expected to potentially clock over USD 9 billion gross GMV (Gross Merchandise Value) during the entire festive season this year as against USD 7.4 billion last year – a growth of 23 percent.

Gross GMV refers to the total value of goods sold on the platform prior to subtracting cancellation or return.

“…the first week (October 2-5) of festive sale of 2021, e-commerce platforms, including social commerce and grocery, altogether the platforms garnered about USD 2.7 billion in sales and are on track to achieve USD 4.8 billion gross merchandise value (GMV)…” RedSeer said in its ‘Mid-Festive Check In’ report.

It added that the first four days of the festive week in CY2020 accounted for 63 percent of the overall festive week sales – as compared to this year where it accounts for about 57 percent of the projected sales.

Smartphones contributed about 50 percent of GMV during the first four days of sales.

“With the festive sales lasting longer than last year (9 days compared to 7 days) – we are observing the customer demand being more spread out across the period than being concentrated in the first half of the Festive week. To that tune, we have observed sales of about USD 2.7 billion across e-commerce platforms and we expect another further about USD 2.1 billion over the next five days,” Redseer associate partner Ujjwal Chaudhry said.

The report estimates that over 75 percent customers are planning to buy equivalent to or more than last year across categories like mobiles, large appliances, beauty and fashion.

E-commerce companies see a large chunk of their annual business coming in during the festive sales and they make significant investments ahead of time to ramp up their capacity and add features to be able to handle the spike in orders, while ensuring a smooth experience for shoppers and sellers.

Companies across the spectrum including Flipkart, Amazon, Snapdeal and Myntra have lined up new launches and offers to woo shoppers during the festive season. Players hold multiple sale events that are timed around Dussehra and Diwali.

Global retail market has reached pre-Covid levels: Lulu Group

Source: Economic Times, 11 October 2021

The global retail market, including India, has almost reached the pre-Covid level. A full recovery is expected very soon with the renewed demand and bounce back of retail, said M.A. Yusuff Ali – CMD, Lulu Group.

Lulu Group has faced a delay of its three mall projects in the country due to the disruption caused by the pandemic and the subsequent lockdown impacting the retail industry the hardest.

“While no business has been immune to the pandemic over the last two years, I am confident that it is just a matter of time before the retail sector bounces back. We faced some delays in the projects, but there were no plans to drop any investment plans because of the COVID-19 created business situation,” said Yusuff.

LuLu Group International has committed Rs 5000 crore to develop retail malls across Bangalore, Trivandrum and Lucknow. The firm had earlier planned to open these stores last year. However, the outbreak of pandemic globally halted its plan.

“India holds a huge potential in the retail sector, and there is no slowing down of investment from LuLu Group globally. The second investment phase will be a sizeable amount in India over the coming years,” said Ali.

The firm’s two projects – in Lucknow (Uttar Pradesh) and Thiruvananthapuram (Kerala) are expected to open by the end of this year and early next year. The group has also extended its second retail destination, an 8 lakh sqft Global Mall in Bangalore. While the Lulu Hypermarket – the giant Hypermarket in Bengaluru is spread across 2 lakh sqft, and Funtura is set up across 60,000 sft, the largest indoor entertainment zone in India.

At the onset of the pandemic, consumer behaviour shifted towards ‘conscious buying’, leading to a significant shift in consumer purchase behaviour across physical retail and E-commerce. The F&B, E-commerce, pharmaceuticals, and the traditional grocery retailers as the top-performing sectors witnessed steady growth despite the pandemic.

The Abu-Dhabi based firm plans to further expand to more tier I and tier-II cities in the coming years to tap into the growing retail market in the country. “We will set up more than one store in big cities, but smaller cities will have only one store. We see a revival across our malls globally, including India,” he added.

With an annual turnover worth $ 7.4 billion, and a workforce of over 50,000 globally, its business portfolio ranges from hypermarket operations to shopping mall development, manufacturing and trading of goods, food processing plants, wholesale distribution, hospitality assets, and real estate development across 22 countries. Currently, Lulu Group operates 215 Lulu stores and 23 shopping malls across the GCC, Egypt, India, and the Far East, serving services to more than 1,100,000 shoppers daily.

Green shoots of recovery were witnessed in India’s retail segment with significant improvement in sales and getting closer to the pre-COVID levels. Delhi and Bangalore are leading the sectors’ growth with an expected addition of over 5 Mn Sq. ft of the overall organised retail stock respectively followed by Hyderabad expected to add over 3 Mn Sq.

CBRE South Asia in its latest report titled ‘India Retail Reboot 2021, said the report highlights that India’s organised retail stock has reached 64.3 Mn Sq. ft as of H1 2021 and is expected to cross 82 Mn Sq. ft by 2023.

Livspace plans business expansion with $50 million investment

Source: Economic Times, 18 September 2021

New Delhi: Livspace, an omnichannel home interiors and renovation platform, plans to invest $50 million for its retail business expansion across India and Asia Pacific(APAC), the company said in a press release.

The company holds a 65% market share in the organised home interiors sector and also plans to set up 150 Design Experience Centre (ECs) over the next 18 months.

With this phase of expansion, the company expects to capture the demand for modular solutions from markets such as Indore, Surat, Lucknow, Mysore, and more.

“The home industry suffers from massive fragmentation. By setting up another 150 Design Experience Centres in over 60 cities in India and over 20 cities in the Asia Pacific we intend to bring the same goodness to these new markets”, said Ramakant Sharma, founder, and COO, Livspace.

The new centers will supplement an existing network of over 25 stores in both metros and non-metros, such as Delhi-NCR, Bengaluru, Mumbai, Ahmedabad, Jaipur, Kochi, etc.

During this phase, the company will look to onboard over 1,000 new design entrepreneurs across the country and also look to grow the team overseas.