India Retail News.

India's first retail brand of non-formal leather shoes - Woodlands is all set to expand its reach and scale its size and design.

The company is doubling its production capacity to cater to the need of Indian market.It has also plans to expand its dealer network by 20% and get into more retail malls across India. The company also wants to woo the Indian consumer with the latest design for which it has hired a design team in Italy. The company also plans to get into formal footwear business under the brand - Woods, to cater to the smart and young executives of corporate India who are its loyal customers.

Apart from shoes, the company also plans to consolidate its retail apparel business for both men and women by launching new products. It has introduced denim range - jeans, jackets and waistcoat.

Reliance Fresh is now an independent entity spun off of RIL. The new business strategy indicates that the company is planning to make its food vertical end-to-end business with a fresh impetus on all its categories - fruits, vegetables and private label FMCG brands.

The company is determined to sell fresh fruits and vegetables despite protests in backward states of Uttar Pradesh, West Bengal, Orissa etc. Reliance Fresh has introduced its own brands in categories such as milk and ghee.

Reliance started by a conservative Gujarati family - Ambani has kept the meat business out of Reliance Fresh brand and is being handled by "Delight" brand of stores. The entire operations of Delight are handled separately - from sourcing to distribution to retailing as the Chairman, Mukesh Ambani himself is a strict Vegetarian.

Witnessing the success of global brands such as Adida, Nike, McDonalds operating on Franchisee modelMukesh Ambani managed Reliance Retail is also inviting franchisees to run various retail formats except Reliance Fresh and Reliance Hypermarkets. Yes!!! You are reading it right, the company is facing extremely high real estate costs which delays its plans and hence wants you to be their partners in retail growth :-)

Mr. Bijou Kurien, CEO, Reliance Lifestyle said,

We would capitalise on the traditional retailers' capabilities. The difficulty in locating land negotiating a good deal and then the time taken to conclude a deal are significant challenge.

However, we think that Reliance has significant managing capability, be it Real Estate or Supply chain and this move could just be under pressure from several politicians and bureaucrats where they faced stiff opposition. [As the saying goes, Live and Let Live, thus Reliance could have taken this strategy]

Mr. Kurien further added,

We will be able to co-opt traditional retailers instead of competingwith them. We would help neighborhood grocery stores by letting them purchase from our wholesale stores thereby reducing their cost of purchase, which comes as a result of super efficient supply chain.

Reliance Retail operates in the following formats,

• Reliance Digital [About Reliance Digital ]
  
• Reliance Tiemout [About Reliance Timeout]
• Reliance Footprints [About Reliance Footprints]
• Reliance Jewelery [About Reliance Jewellery]

If you have read what each of these stores is all about, and if you deem yourself fit and have the zeal to operate, send in your retail proposal.

Reliance Retail which is on a roll since late 2006 has chalked out an ambitious expansion plan for its Hypermarket under the brand Reliance Mart and Reliance Super. The company hopes to open and operate 30 such stores by the end of June-2008, which sounds bit too ambitious and may actually see it happen only by end of 2008.
Currently they have 4 stores - one each in Ahmadabad, Jamnagar and a smaller version of them in Amritsar and Gurgaon. Reliance Hypermarkets are a value for money retail stores selling everything from apparel to durables except the premium items.

Century Textiles Ltd is revamping its retail face - Cottons by Century. The company will also launch 3 brands - D'nims [read Denims], Centurian and UVA for the Indian youth.

• D'nims - will be a range of denim wear falling into the premium category
• Centurian - Trousers range made from Poly-Cotton and Poly-Viscose fibers
• UVA - casual wear brand

The company already has 41 Exclusive outlets and will add another 30. It is also planning to offer stores by franchisee route.

In another development, Goenka's promoted Welspun is planning to hive off Welspun Retail into a separate company. The company has two retail formats, WelHome and Spaces. The former is into value for money products and the latter is into high end furnishing. The company is on a rapid expansion plan to have 370 stores by 2010 and is also inviting franchisees .

Swiss watchmaker Rado has lined up plans to increase its point of sales from 150 to 175. It also plans to increase the number of exclusive showroom to 14 from the present 6. In the past 3 years, India's appetite for luxury goods has gone up and Rado has seen its sales grow 3% YoY. The company recently introduced Chronograph range of watches starting at Rs 67,000.

In a separate development, Tommy Hilfiger which was one of the early foreign retailers to taste success in India is now planning to have its presence in Tier-II and Tier-III cities - Ahmedabad, Ludhiana and Lucknow. Mr. Chaturvedi, CEO of Tommy Hilfiger India said,

There is immense appetite for luxury brands in India. The market is exploding. We are currently in the second phase of expansion and will be having 23 points of sale by the end of this fiscal.

The company may go in for shop-in-shop formats rather than having exclusive stores. High duty on imported goods is the main hurdle for its growth in India.

World's leading lifestyle retailer Armani has agreed to join hands with India's leading Realtor - DLF. Giorgio Armani will hold 51% stake in the venture. It is unbelievable that world class retailers are bowing down in India to Realtors because of the exuberant retail rentals at malls.

The JV will undertake the sale of several world class brands such as Emporio Armani, Armani Jeans, Armani Junior and Armani Collezioni. The first two stores will come in DLF's Emporio Mall at Delhi. The JV will focus on retailing footwear, handbags, luggage, watches, phones, perfumes, eye wear, sports gear and other accessories.

Apart from establishing its own stores Armani also has given nod to other master franchisees to retail at Luxury malls in India.

We conducted an exclusive survey at the end of December-2007 and collected data on the number of stores each retail chain operates in India. We summarize the data as follows.

• Shopper's Stop - Lifestyle Retail: Apparel segment, Personal care. Operates 23 stores across 11 cities
• Hypercity Lifestyle retail: all verticals operates two stores and has introduced catalog shopping for the first time in India
• Home stop Lifestyle retail: Home furnishing and decor products operates 2 stores with presence in 2 cities
• Mothercare Lifestyle retail: Baby products - 11 stores in 6 cities
• Tata Westside Lifestyle retail: Apparel - 27 stores across 17 cities
  
• Tata Star bazaar Value retail: All verticals - 4 stores
  
• Tata Croma Lifestyle retail: Consumer durables - 40 stores
• Vishal Retail -Value retail: Apparel, general merchandise and FMCG 72 stores in 50 cities.
• Reliance Fresh - Value retail: Food & Grocery - 300 stores in 30 cities
• Reliance Hypermarket - 2 stores.
  

The survey was restricted to only retail interests of listed entities.

The Total Retail market size in India at the end of 2007 was Rs 12,781 bn. Food and Beverage constituted a whopping 74% of the market followed by clothing and textiles at 9%.
The organized retail market breakup is as shown below. Clothing and Textile has the largest pie of organized retail market since Grocery [Reliance Fresh etc] are facing protests on opening new outlets in the backward states of India such as Uttar Pradesh, Orissa, Bihar etc.

Lal Mahal Group just a while ago informed us about their retail venture LM 365 Retail Chain of Food Stores. The group will open 15 retail stores in Delhi and the NCR today. The outlets will sell both food and non-food consumer products of mass consumption. The averegae size of each store will vary between 1,000 sft to 4,000 sft.

Lal Mahal is basically a agricultural commodity trading company. The group said that it will breakeven with LM 365 stores in the very first year of its operations.

Inner wear brand, Jockey, in India is repositioning itself as a Lifestyle brand with included focus on leisure wear segment.

To mark its entry, the company is offering new products in the women's segment such as Pyjamas and Gym Wear and will also open more outlets focusing on the needs of Trendy Indian lady.

Mr. Puri, Marketing Head, said,

The idea is clearly to position ourselves as a lifestyle brand for which we are adopting a 360 degree initiative, creating super-premium categories for women and opening more exclusive brand outlets.

The bulk of company's sales in India still come from Mens segment.

Related Reading:
E-Spirit sees huge potential for Lingerie market in India
Inviting Franchisee offers for Straps Lingerie

Every Indian industry wants to make it big in the retail sector. Kansai Nerolac paints with dominance mostly in Automobile is now turning its attention to the fast growing Construction segment.

Nerolac has said that it will establish 45 Impression Style Zones which will help the Indian consumer visualize design and conceptualize their homes. The showrooms will be equipped with workstation where a trained associate will show a demo on Nerolac proprietary software on how the designs and patterns will look like.

45 such zones will be setup in the south Indian cities of Bangalore, Hyderabad and Chennai. Each outlet will be backed by 20-25 company approved contractors. All of them will employ Nerolac certified painters :-)

If your readers are interested in Franchise opportunities, then you may contact the company directly depending on the vertical of your expertise or interest. Do tell them that you read about their offer on OmRetail.com.

Spykar
Vertical: Retail Apparel
Required Capital: Rs 25 Lakh
Contact: span@spykar.com or 022 - 40921000

Club City
Vertical: Food and Beverages
Required Capital: Rs 30-50 Lakh
Contact: 931120-70576

Levis
Vertical: Clothing
Required Capital: Rs 50 Lakh to Rs 5 crore depending on location
Contact: 011 32638433

Just Cuts
Vertical: Hair & Beauty Salon
Required Capital: Rs 20 Lakh+
Contact: justcuts@gitanjaligroup.com 93111-44600

KidZee
Vertical: Pre-school & Activity Center for kids
Required Capital: Rs 5 Lakh
Contact: kidzee@zils.esselgroup.com

Veta
Vertical: Education and Training
Required Capital: Rs 8 -12 Lakh
Contact: 99529-77771

Travel Port
Vertical: Tours & Travel
Required Capital: Rs 3 - 6 lakh
Contact: 98679-74602

Castrol Bike Zone
Vertical: Two Wheeler Servicing
Required Capital: Rs 15 - 25 lakh
Contact: 93853-98846 or castrolbikezone@rediffmail.com

In the silicon valley its a fight between Apple Inc and Microsoft to get a slot in your living room through IPTV. However in India, consumer durables company Godrej which entered your kitchen [Refrigerator, Microwave Ovens], bed-room[A/C], bathroom[Washing Machine] now wants to be present in your Living Room - Plasma and Color Television.

Mr. George Menezes COO Appliances Division said,

We are closely evaluating the possibility of entering the television segment both in the premium and mass market segment. Being a home grown company we want to design technology for the Indian market.

Godrej spends just 5% on R&D and the pie should be distributed to all the verticals of consumer durables making it impossible to launch a world class TV on its own. Our analyst adds that the company should just find out a reliable manufacturer in Taiwan or Malaysia and outsource the manufacturing and sell them under Godrej TV brand in India.

The Indian Consumer market was extremely buoyant in the year 2007 as evident from Holiday season sales. We now have exclusive numbers on the consumer durables sales. The consumer durables market witnessed a growth of 22%. At the end of 2007 it had touched Rs 20,425 crore.

Microwave Ovens saw the highest growth rate at 38% followed by Washing Machines at 17%. The market for Refrigerators grew 13.3% and Color Television by 11.4%.

The sales of Plasma TVs are growing at a faster rate compared to conventional CTVs. Similarly, sales of Fully Automatic washing machine is growing faster than the semi-automatic and frost-free refrigerators are being sold at a faster rate than conventional cooling products.

Reliance Retail is in talks with global majors to roll out 3 new formats in the lifestyle segment. The company is holding talks with several European and US retailers. Mr. Bijou Kurien said,

Announcements maybe made in the next few months. It will take a further 18-24 months to launch new store formats.

Reliance opened its Timeout store in Gurgaon's Ambience Mall. This store is twice the size of Bangalore's Reliance Timeout store and was the second in the series. The third store will open in Kochi and another 42 will roll out over India by 2010.