One of India’s oldest chains of departmental stores, Shoppers Stop, is planning to open premium outlets across the top metros to draw millennial shoppers seeking the latest in fashion.
Its recently opened 50,000- sq.ft outlet in Gurugram will sell recent additions in its premium offerings, such as bags from Coach, Kate Spade and Micheal Kors, men’s apparel from Armani Exchange and FCUK, women’s fashion brand Jones New York, and beauty brands such as Tom Ford and Jo Malone, apart from ethnic wear labels, kids clothing and inner-wear. The store will also house coffee chain Starbucks and toy retailer Hamley’s.
Shoppers Stop has been working on two new-store formats over the last 12-18 months and is upgrading existing stores. The store designs were conceptualized by two separate global design agencies.
For its more premium store in Gurugram, the retailer has roped in London-based retail design agency Dalziel and Pow.
The retailer with 84 departmental stores across 40 cities will add another half-a- dozen premium formats in the top metros over the next few years, Rajiv Suri, managing director and chief executive officer (CEO), Shoppers Stop Ltd, said in an interview.
“We have opened this, we will test it for six months, see what is working and what is not and then we will fine tune it. The next few stores will be modern and in line with changing aspirations of the customers," said Suri, who took over as CEO in 2018.
“Between the two formats, depending on the affluence index of the area, we will use one of the two," he added.
Shoppers Stop, which announced its second-quarter earnings last week, has also significantly increased its store opening guidance for the year, increasing the earlier forecast of 4-5 stores to 8-10 this financial year. Moreover, the chain will open 40 new beauty doors (a mix of shop-in-shops and stand-alone stores) this fiscal year to capture the growing trend among urban Indian shoppers to upgrade to more premium beauty products.
In all, it has over 120 beauty point of sales in India, including stand-alone stores and shop-in-shops. More beauty tie-ups could be announced soon, Suri said. The retail chain has rights to operate and sell beauty brands of The Estée Lauder Companies Inc., which include MAC, Clinique, Bobbi Brown, Smashbox and Estee Lauder. The chain also runs home furnishing stores under HomeStop.
Shoppers Stop started out in 1991, and is part of the Mumbai-based K. Raheja Corp. It has been synonymous with launching fashion departmental stores that sell everything from women’s ethnic wear and men’s formal wear to kids’ clothing and accessories.
The company is upgrading its stores to improve profitability and lift footfalls.
In all, the chain has refurbished half-a-dozen existing stores and plans to revamp its beauty sections in over 15 locations. Earlier, it had shut down loss-making stores and re-sized a few outlets to improve profitability. Besides, it has discontinued with over 35 brands (17 apparel and 20 home) and added a dozen new brands in its stores.
The retailer has also intensified its focus on private labels with a large in-house team of designers. This could help the company increase its private labels revenue from 13% in FY19, to 15% in FY20, analysts at Motilal Oswal said in a research note last month.
Changes at marquee retailers come at a time when they have been facing stiff competition from online retailers and new and emerging global fast-fashion brands such as H&M and Uniqlo. “There is a certain time in your journey when you are fully ready as a company, you have the right product, and team, technology and store concepts, and you have the financial resources without going to the bank," Suri said, dismissing fears that a slump in consumer demand will impact the chain’s plans to improve its offerings. “When the economy is down it is the best time to invest," he added.