Government to talk to states on FDI in multi-brand retail

Food and Agriculture Minister Sharad Pawar Wednesday said the government will talk to the states about opening up the multi-brand retail sector to foreign direct investment.

The minister said there were 'serious problems' in allowing 100 percent foreign direct investment (FDI) in retail as it would affect the interest of small shopkeepers of the country.

'It will give good prices to farmers and consumers will also get wider choices. But we cannot bypass the small shopkeepers,' he told the Economic Editors' Conference here.

India allows 51 per cent FDI only in the single-brand retail. Multi-brand retail is restricted to cash-and-carry or wholesale outlets.

Rel Retail plans 4,000 stores in 4 yrs

Mukesh Ambani promoted Reliance Retail plans to set up around 3,000-4,000 stores in 19 formats in the next 4 years. The company is predicting 100% growth for the financial year 2010-11. Reliance Retail currently operates 19 formats such
as Reliance Fresh, Reliance TimeOut, Trendz and Digital and Jewels, among others.

The company is also aiming at entering the cash-and-carry business by opening around 3 outlets in the next 6-8 months. The cash and carry stores will have a square feet area 1.5 lakh.

The company has projected Rs 45,000 crore turnover from the retail business in the next five years. It is also bringing global brands like Hamleys, Diesel and Marks & Spencer under its roof in all formats.

 

‘Retail expansion will remain a core focus'

 ""The Managing Director of Aero Club, which owns the Woodland brand, on the company's growth strategy.."" 





         Harkirat Singh, Managing Director, Aero Club, the brand that owns the rough-and-tough brand, Woodland, says everything the company does has a green tag to it.


    “We are an outdoors brand and very much in tune with nature. Whatever we do, it will never be against the environment but rather in consonance with it,” he declares.
Interestingly, when BrandLine meets up with him on a balmy afternoon, he has coordinated his dress with a deep green and yellow turban — a signature Woodland colour.
In a freewheeling interview, Singh outlines the brand's persona and future growth opportunities for the company.
Can you trace Woodland's journey for us?

    We started operations in Quebec in Canada making specialised winter boots for the harsh climate there. We were suppliers for factories and leading retailers in Europe and Russia. We had tanneries in Canada. In the early '90s, we started looking for other markets to expand and we chose Europe and India. We had several other brands as well. Woodland was one of the brands that we launched in India.
When you entered India, the footwear market was largely dominated by players such as Bata and others from the unorganised sector. Woodland created a new category of expensive shoes which was well received. Between then and now, how has the market evolved?
  
      When we entered India, there were only Bata and Corona, among others. The youth took a fancy to our shoes as there was nothing in that category offering both fashion and utility. Even though we were priced high, we managed to connect with the youth and that did a lot to promote the brand. That was in the beginning and we gradually developed a product line especially for India.

      When did you change track from being a purely manufacturing company to a retail brand?
In the mid-Nineties, there was an invasion of Chinese products in the Canadian market. At that point of time, we consciously moved to the Far East, India and West Asia. The Indian market was growing and we considered it the right time to start our retail journey here. We opened our first store in 1997. The response was good and we start expanding and diversifying here. Currently, we have 300 company-owned, company-operated stores with a total retail space of around six lakh sq. ft. Our shoes and apparel are also retailed through 3,000 distributors pan-India.
Unlike many other players in the industry, you have not opted for the franchise route to expansion. What is the thought behind the decision?
      
           We did try the franchise model but somehow it did not work well for us. It is difficult to convince a franchise partner to stock higher-end products and also to keep a check on quality. Therefore, we decided it was best to go it alone.
What is your strategy for growth?
In the last six-seven years, the retail sector has grown but we have been very selective and slow in our expansion. Where there is a good opportunity, we go ahead with expansions. We started with the metros but are expanding to the smaller towns as they are also accepting all the brands, not just ours alone. Our belief is that growth should be consistent and our product offering should be good. We are particular about product quality and are trying to improve on it. Retail expansion will continue to be a core focus besides diversifying into specialised lines such as kidswear and a yoga line.
You have been looking to find your feet in China?
        
       Woodland is available in many countries. We are also going into China as it is a huge market in terms of consumption. We believe we can replicate our success in China. We have already appointed a distributor in Hong Kong.
There is lot of nature in Woodland. Does that reflect in your manufacturing practices as well?
Yes, very much. Woodland is all about adventure and that is the idea behind the brand. We believe you should be as close to nature as possible. We have tied up with a German company for technological knowhow. Our manufacturing facilities use robots and are reducing human intervention. It brings lot of perfection and improves efficiency. Also, we are working with our suppliers to reduce the impact on the environment. Reuse and recycle is core to our philosophy. For example, the chemical used in our shoes can be retrieved and reused. We use organic clothing and our leather is treated with vegetable tanning agents. We have formed a Woodland adventure club and are promoting it in schools. We will be promoting our products through social networking sites such as Facebook to take our products closer to our customers.
                

              What is the kind of growth you are looking? Are you likely to hit the bourses in the near term?
We are growing at about 20-25 per cent. Last year, our group turnover stood at Rs 600 crore. We are not looking for a listing. We don't need outside funds. For the current year, we have earmarked Rs 50-60 crore for product development and technology enhancements for our manufacturing facilities. We are also identifying the opportunity to open 60-70 large-format stores of an average size of 4,000 sq.ft. by 2011. 

'Koutons Retail delayed debt repayment, not defaulted

Apparel retailer Koutons Retail India Ltdhas only delayed payments to its lenders, a top official said, denying reports of a loan default , which had sent the company's shares plunging last week. 

The New Delhi-based retailer, currently valued at 4.75 billion rupees, lost 47 percent in market capitalisation last week, following reports of default and a rise in pledged shares by founders that led to murmurs of their probable exit. 

The delay was due to a "mismatch of cashflow, which will be rectified soon," Chairman D.P.S. Kohli told Reuters on Monday adding the company had a "slow first quarter". Shares in Koutons opened on Monday at an all-time low of 139.95 rupees, but recovered and were trading 0.48 percent up at 156.20 rupees at 3:35 p.m. local time in a Mumbai market that was up 0.44 percent. "Internal accruals will take care of debt repayment," said Kohli, adding that the festive season will boost sales at his 1,196 stores across the country. 




link ::


http://economictimes.indiatimes.com/news/news-by-industry/services/retailing/Koutons-Retail-delayed-debt-repayment-not-defaulted/articleshow/6683664.cms 

Croma wins 'Most Admired Retailer 2010

Tata Group company, Croma, has won 'Most Admired Retailer of the Year' in the consumer electronics category award for the third successive year at the Images Retail Awards 2010.

Croma offers consumers more than 6000 products across 8 categories of consumer electronics and consumer durables. Croma� is India's first nationwide Electronic Mega Store offering a unique shopping experience that is consistent across the country 

These awards are conferred by India Retail Association and is supported by all the leading retail entities in the country.

Infiniti Retail is a 100% subsidiary of Tata Sons. The company has launched Croma, a national chain of mega stores of consumer electronics and durables.

"We are honoured to receive this prestigious award for the Most Admired Retailer of the Year-Consumer Electronics. This clearly indicates our continued commitment to deliver a world class shopping experience, the widest variety of products and robust after sales service, coupled with interactive and helpful customer service for our discerning customers," Infiniti Retail's managing director and chief executive officer, Ajit Joshi, said in a statement here today.

Croma operates 52 stores across 10 cities pan-India.

The company posted a turnover of Rs1,021 crore in 2009-10.

Croma is the largest retail partner for all the leading brands including Sony, Samsung, LG, HP and Nokia.  

Retailers gear up to bring more international brands

         

          Many leading Indian apparel retailers, including , and , are gearing to bring in more global brands as they look to expand their portfolio within the next one year. 

•         "As the retail sector is opening up, more foreign brands are looking up to the Indian market. They are looking for local partners here," Arvind Lifestyle Brands Head of Marketing (Gant, Arrow & Izod) Amod Choudhary told PTI. Hence Indian retailers are trying to tap the opportunity for a win-win situation. 
• "We are aggressively looking to bring in more global brands. By the end of next financial year, we will have more brands in our portfolio," he said. 

• Arvind currently sells 11 apparel brands, including Flying Machine, Arrow, Gant and Izod among others. While premium formal wear brands have been their most successful ones, Choudhary said, adding casual and women's wear are the future growth areas. 

• Likewise, SKNL group is also in talks with five international brands and plans to introduce one of them in the next five to six months. 

• "We are in talks with five international brands in the world. They are across all segments, across the board. In the next five to six months, we are bringing an English premium shirt brand in India," SKNL Group President Apparel and Retail Ashesh Amin said. 

• Apart from increasing spending power among the youth, foreign retailers are eying the Indian market for their future growth as western countries were reeling under the economic slowdown in the last two years, he said. 

• Similarly Reliance Retail, which is currently planning to expand its apparel portfolio, said it is tying up with two international brands in the next two years. 

• "In the next two years we are likely to announce tie-ups with two more international brands," Reliance Brands President and CEO Darshan Mehta said without mentioning the names.  

• At present, Reliance Brands sells apparel brands like Diesel, Timberland and Paul & Shark. 

•   Recently Blues Clothing company, which sells luxury brands like Versace, Cadini and Corneliani, has also announced that it is planning to bring three Turkish fashions brands from by this month. 
• 
  

Retailers line up private-label launches in food products for Diwali

 Come Diwali and you can choose from a host of new soup, pasta, snacks and cereal breakfast brands at major retail stores. 

In a bid to make the most of consumers’ propensity to spend during the festival season, retailers are out to boost their private-label (in-house brand) portfolios, especially in the foods segment, and are lining up promotions over October and November.

Generally, private labels are 20-30% cheaper than mainstream branded products.

However, retailers are still able to make healthy margins on them, mainly because they do not have to spend separately on promotion and sales channel. 

The Future Group, which has in-house food products such as chips, noodles and breakfast cereals under the brand Tasty Treat, is starting a brand campaign —- Tasty Treat Khao Peo Mela —- across its Big Bazaar, Food Bazaar and KB’s Fair Price outlets next month.

“The idea is to celebrate the food offerings of our private brand Tasty Treat through in store marketing , sampling and activation to actively engage the consumer during the festival period,” Devendra Chawla, business head, private brand, Future Group Ltd said.
The group will also launch its range of pastas and jams during this period.

Chawla said the company is looking to derive 25-30% of its sales from private brands in foods, up from 22-23% now.

The contribution of private brands to sales is as high as 80% in categories such as apparels and the focus now is on growing the contribution of foods, he said.

K Raheja group promoted hypermarket chain.HyperCity will launch at least 25-30 private brands in foods (mithai, namkeen, 

savouries), non-foods and apparels in October, Ashutosh Chakradeo, head - buying, merchandising and supply chain, said.
Next year, when the company has at least 10-12 stores running, it will introduce an in-house brand in the electronics space, he said.

“At the company level, private labels contribute 20% to overall sales,” said Chakradeo.

Spencer’s Retail, the retail division of RPG Group, too, is going to launch new products in October under its FMCG brand Smart Choice. It will launch categories like breakfast cereals, soups and masalas.

Private labels account for 15-16% of Spencer’s sales, and the company is looking to increase this to 30% in a year.
Vineet Kapila, president, Spencer’s Retail had earlier told DNA Money the company was focused on private labels and that a separate team was working on expanding the private products in FMCG.

For Aditya Birla Retail, private-label products form 17% of sales with the foods category growing 50%. The company has brands like Feasters and Kitchen’s Promise in foods.Evidently, retailers are looking at foods as a category that can fuel growth.

Each retailer is thus introducing in-house brand offerings in breakfast cereals, soups, noodles, pastas, sauces and other processed foods, which are cheaper than products of FMCG companies. 

E-commerce to generate Rs 3,000 cr in 4-5 yrs: Biyani

       Future Group founder Kishore Biyani today relaunched his digital retailing arm, FutureBazaar.com, which is aimed to generate a tenth of the group's revenues in the next four to five years. 
       Biyani to launch revamped e-commerce initiative today

•            The relaunch followed a period in which the Rs 10,000-crore group decided to consolidate its loss-making formats and narrow the focus to ventures such as Big Bazaar, Food Bazaar, Central and Ezone, during the economic slowdown. Biyani said of the group's revenue target of Rs 30,000 crore in the next five years, FutureBazaar.com will contribute around Rs 3,000 crore. "We expect a business of Rs 1,000 crore in the next 18-24 months from the business," he said.

•          The group's relaunched venture includes mobile commerce, teleshopping and online platforms. "Physical stores are getting expensive. Digital commerce is cheaper to physical commerce by 5 to 10 per cent; in electronics, it is 25 to 30 per cent. We can save a lot a lot on warehousing and inventory costs in this format and pass on the same to consumers," Biyani said. http://sify.com/finance/e-commerce-to-generate-rs-3-000-cr-in-4-5-yrs-biyani-news-equity-kkbblsfdbfc.html

Future Group bets big on e-bazaar ..

Future Group is betting big on Future Bazaar, its e-commerce initiative, as it gears up to expand operation. To make this channel available for consumers online and through mobile, the company has unveiled The Battle, a dedicated four-day online shopping festival, which will offer mega discounts 

for consumer electronics products.

“We want to revolutionise digital commerce in retail in India. We will be offering the cheapest deals online, which will be 5-10 per cent cheaper,” said Kishore Biyani, CEO, Future Group.

Future Bazaar is the online retail venture of Future Group and sells products from its group companies. The company had ventured into the e-commerce space or online business four-years ago.

“We expect the scale to go up five times during this concentrated festival and touch 50,000 units. As more plans unfold, we can expect the e-commerce division to garner a R1,000-crore revenue in two years,” said Rajiv Prakash, CEO, Future Bazar.

Future Bazar is looking at gross margins of 12 per cent from the e-commerce venture. It may take this initiative to general merchandise, footwear and other products in future.

LINK ::

http://www.hindustantimes.com/Future-Group-bets-big-on-e-bazaar/Article1-606609.aspx