Bangalore: Marks & Spencer Reliance India Pvt. Ltd is stepping up its expansion in the country after reporting strong growth across its brands. The UK-based retailer plans to open five stores of 20,000-23,000 sq. ft each by this summer, after opening just six in the whole of last year.
“We haven’t seen a slowdown. Our store expansion is picking pace and it’s a lot more aggressive now,” said Venu Nair, managing director, Marks & Spencer Reliance India.
Sales of Marks & Spencer’s clothing brands grew 33% in the December quarter, with men’s clothing climbing 31% and lingerie 28%. The company—which runs its business in India through a 51:49 joint venture with Reliance Retail, owned by Mukesh Ambani’s Reliance Industries Ltd—also sells women’s apparel, kids clothing, footwear and home products through 29 shops in the country.
The retailer will open stores this year in existing markets such as Delhi, Mumbai, Hyderabad, Bangalore, Chennai and in some new cities as well, Nair said. Most of its stores are located in malls, but it recently opened three standalone stores. Nair said a majority of its stores will be set up in malls.
Marks & Spencer globally has increased sourcing from India and South Asia to save costs and deliver products faster in its emerging markets. It now sources 61% of its material from India and South Asia, up 6% from last year. This has enabled the company to offer products at relatively low prices—it sells polo T-shirts for as low as Rs.500, for instance.
“Being able to source from here has the advantage of not just costs but also the lead time is shorter and we can get products to customers quicker,” Nair said.
“Having gotten their pricing right they should become much more aggressive in opening stores. They can easily double the number of their stores—29 is an insignificant number,” said Harminder Sahni, managing director of Wazir Advisors, a consultancy. “One of the reasons they are expanding so slowly is that their store size is large and they have a wide product range. Maybe they should look at doing some womenswear stores, menswear stores, etc.”
Marks & Spencer, which competes with the likes of Louis Philippe and Peter England, is also changing its store format to push its sub-brands. Apart from its eponymous brands, Marks & Spencer sells seven brands in India, including North Coast and Blue Harbour for men and Per Una for women.
“We’ve added a lot of props to our sub-brands. We’ve added things like different-coloured brick walls and rugs, according to the image of the different brands we’re trying to convey. There’s a much clearer brand segmentation in our stores,” said Amit Kothari, manager, marketing.
The company will likely launch its premium Saville Row-inspired range of formal menswear in India this year. “There are a couple of brands that we haven’t brought here yet and depending on the location we would bring them in; quite likely, this year. Currently, we don’t sell Saville Row, which is relevant to the Indian market,” Nair said.
A Times of India report in March said that Marks & Spencer was planning to launch its food retail business in India. Nair declined to comment on this.