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  • 1. FASHION RETAIL MANAGEMENT: PROFILE OF MAJOR RETAILER START SOMETHING NEW ….PROJECT GUIDE: SUBMITTED BY:Mr. Sushil Raturi Ajay Kumar M/FMS/08/02Course Cordinator, FMS Dept. Bhavik Gandhi M/FMS/08/10National Institute of Fashion Technology, Prachi Jain M/FMS/08/20Mumbai Sameera Baig M/FMS/08/25 Soumya Mishra M/FMS/08/30
  • 2. FASHION RETAIL MANAGEMENT CONTENTSTOPICS Page No.1. Introduction………..……………………………………………....................... 032. Evolution….…………………………………………………………………… 073. Status 3.1 Various Location of Shoppers Stop………………………………..... 08 3.2 Number of stores…………………………………………………….. 09 3.3 Retail area……………………………………………………………. 09 3.4 Manpower……………………………………………………………. 09 3.5 Brands………………………………………………………………... 09 3.6 Awards……………………………………………………………….. 104. Sales Analysis………………………………………………………………….. 115. Financial Analysis……………………………………………………………... 166. Product Mix & Price Point…………………………………………………….. 177. Human Resource……………………………………………………………….. 198. Expansion Plans………………………………………………………………… 209. Strategic Alliance……………………………………………………………….. 2110. Promotion……………………………………………………………………… 222008 Page |2
  • 3. FASHION RETAIL MANAGEMENT 1 INTRODUCTION Then NOWThe company‟s flagship business of department stores is manifest in Shoppers Stop. A pioneer ofmodern retail in India, Shopper‟s Stop Ltd. today, is the country‟s largest chain of DepartmentStores. It offers customers an international shopping environment and a world-class shoppingexperience through its 24 stores in 12 cities. It houses a host of international and domestic brandsacross categories such as apparel, accessories, cosmetics, home & kitchenware as also its ownexclusive brands.Pioneer of modern retail in India, Shopper‟s Stop Ltd, has been instrumental in bringing aboutthe retail revolution in India. A professionally managed and systems driven organization,Shoppers Stop has always been attuned to evolving consumers. The customer insights haveenabled company to service them better and fulfill aspirations.Shoppers Stop has evolved its positioning to „Bridge to Luxury‟ and continues to reinforce itsleadership position. The company recently revealed our New logo, which reflects the essence ofthe company‟s new philosophy.HomeStop is the first-of-its-kind premium home concept store at Bengaluru, Mumbai and NewDelhi, offering a wide range of products and some of the most reputed national and internationalbrands.It is a one-stop-shop for all home needs ranging from home décor to furniture, bath accessoriesto bedroom furnishings, mattresses to draperies, carpets to modular kitchens & health equipment,all under one roof.2008 Page |3
  • 4. FASHION RETAIL MANAGEMENTSpacious, well laid out bookstores that feature methodical classifications, clear signages,dedicated enquiry/orders desks and attractive displays along with cafés, reading tables and chairswithin the store make Crossword the leader in the lifestyle bookstore category. Its uniqueproduct mix of books, magazines, CD-ROMs, music, stationery and toys is further enhancedwith services like Dial-a-book and Email-a-book and facilities like gift vouchers and „Return,Exchange & Refunds‟ policy. Crossword Bookstores Limited, is a wholly owned subsidiary ofthe company with 48 stores across the country.Mothercare PLC of UK, the largest specialist retailer for infant and toddler care, is now in India.It stocks a variety of products for mothers and babies, toddlers and children till eight years of agewith the focus being on style, function and safety. Mothercare is currently present as 19 storesincluding 10 shop-in shops at Shoppers Stop in leading metros.Shopper‟s Stop Ltd. has a 19% stake in Hypercity Retail (India) Ltd. The first store was openedin 2006 with an area of over 124,000 sq. ft. HyperCITY has redefined the experience of theIndian consumer in the big store format. Its offering includes food and grocery, generalmerchandise and apparel. HyperCITY provides a truly international shopping experience, wherecustomers can shop in comfort in a large, modern, and exciting environment.Shopper‟s Stop Ltd. has ventured into catalogue Stores, call and collect stores, internet retailwebsite and telephone orders through its subsidiary, Gateway Multichannel Retail (India)Limited under the name of „HyperCITY-Argos‟. Currently there are 5 stores operating at Thane.2008 Page |4
  • 5. FASHION RETAIL MANAGEMENTShopper‟s Stop Ltd.‟s foray into Food & Beverage began with Brio - a step up the evolutionaryladder from “franchised coffee bars.” Brio - the café bistro has been designed to be a warm &friendly place to relax, revive and reflect. It has a classic yet sophisticated ambience, friendlyservice and excellent food. Brio has 20 outlets in select cities.Desi café is the Indian fast food concept by Shopper‟s Stop Ltd. The menu is, expectedly, as fullof perennial favourites as it is with yummy twists. The best part of the fare is that it hassomething for every Indian. Be it the breakfast section, the snacks, or the mini-meals – thechoices are diverse enough to take you on a crosscountry tour. The company is currently running3 outlets of Desi Café, one each in Delhi, Lucknow and Mumbai.Shopper‟s Stop Ltd. has entered into a non exclusive retail agreement with world-renownedcosmetics major Estee Lauder to open M.A.C Cosmetics stores in India. M.A.C (Makeup-ArtCosmetics) the professional brand of choice, is the first brand under the Estee Lauder Group ofCompanies portfolio to enter the Indian retail market. Currently there are 4 M.A.C storesoperating in Bengaluru, Delhi and Mumbai (2) with Shopper‟s Stop Ltd.Arcelia is a new retail concept aiming at the growing accessories & cosmetics segment, with astrong emphasis on experience and indulgence and primarily caters to discerning womenshoppers. It retails cosmetics, fragrances, fine jewellery, footwear, handbags etc. Currently thereare 2 stores operational in Delhi and Pune.2008 Page |5
  • 6. FASHION RETAIL MANAGEMENTShopper‟s Stop Ltd.‟s entry into airport retailing is marked by a joint venture with The NuanceGroup AG of Switzerland, the world‟s leading airport retailer. Shopper‟s Stop Ltd is handling theretail operations in the duty paid zones whereas the joint venture company is handling theoperations at the duty free zones in international terminals. The joint venture company, calledNuance Group (India) Private Limited, is already operating outlets at the international airports atBengaluru and Hyderabad.Shopper‟s Stop Ltd. believes that the Indian consumers are looking for multiple options toentertain themselves and their families. It has forayed into the Entertainment sector by acquiringa 45% stake in Timezone Entertainment Private Limited which is in the business of setting up &operating Family Entertainment Centers (FECs). It has 5 outlets in Ahmedabad, Hyderabad,Kolkata and Mumbai.2008 Page |6
  • 7. FASHION RETAIL MANAGEMENT 2 EVOLUTIONYEAR EVENTS1991 The first store opened at Andheri, a suburb in Mumbai selling only Menswear1992 Ladies wear was introduced1993 Added Children & non apparels1994 Loyalty Program titled First Citizen was launched.1995 Opened second store in Bangalore1997 Launched co-branded credit card for our loyalty members in association with HSBC.1998 Opened third store in Hyderabad1999 Implemented JDA Retail ERP (a global leader in retail ERP packages). Opened our fourth & fifth store in Jaipur & Delhi2000 Opened sixth & seventh store at Chennai & Chembur – Mumbai. Acquired Crossword – India s leading retail book chain2001 Opened eight & ninth store in Pune & Bandra2002 Opened the tenth store in Kandivli – Mumbai2003 Opened the eleventh, twelfth & thirteenth store in Mulund – Mumbai, Gurgaon & Kolkata2004 Opened fourteen, fifteen & sixteenth store in Malad – Mumbai, Kolkata & Bangalore2005 Opened seventeen, eighteen, nineteen & twentieth store in Pune, Juhu – Mumbai, Bangalore & Ghaziabad . Launched M.A.C & Homestop – our home store.2006 Opened out twenty first (Mumbai) and twenty second store in Lucknow . Launched Mothercare in India and our F & B outlets Brio & Desi Café. Bought 45% of Timezone India .2007 Signed a 50:50 Joint Venture with the Nuance Group for Airport Retailing Signed an MOU with the Home Retail Group of UK to enter into a franchise arrangement for the Argos formats of catalogue & internet retailing.2008 Page |7
  • 8. FASHION RETAIL MANAGEMENT 3 STATUS3.1 Various location of Shoppers Stop:The location of various stores of Shoppers Stop Limited is classified into Shoppers Stop,Homestop, Hypercity and Speciality (Includes Crossword, Mothercare, Arcelia, M.A.C. Cliniqueand Food & Beverage outlets).The Shoppers Stop group has its presence in 14 cities and 9 states across India.2008 Page |8
  • 9. FASHION RETAIL MANAGEMENT3.2 Number of StoresSr Formats No. of Stores No. of cities Remark1 Shoppers Stop 24 122 HomeStop. 03 033 Crossword 48 144 Mothercare 19 08 10 shop-in-shop5 Hypercity 01 016 Hypercity Argos 05 01 Catalogue stores7 Brio 20 -8 Desicafe 03 039 M.A.C 04 0310 Arcelia 02 0211 Nuance 02 02 Airport retailing12 Timezone 05 043.3 Retail AreaTotal retail area of Shoppers Stop and its various formats total‟s to 1.6 millionsq. ft.3.4 ManpowerEvery Shoppers Stop employee is termed as Customer Care Associate toemphasize the belief that the customer always comes first. The total number ofcustomer care associates stands at 3754 in the year end March 31, 2008.3.5 BrandsSTOP - Smart, comfortable clothing with a perfect mix of classic and contemporary styling.LIFE - Trendy, energetic casual clothing & accessories based on global fashion trends.KASHISH - Elegant & exquisite traditional occasion wear for the ethnic chic.VETTORIO FRATINI - Sophisticated formal & causal clothing line for the power dresser.ELLIZA DONATEIN - Fashion formals styled with elegance for the modern working woman.HAUTE CURRY - Young & funky ethno fusion wear for today‟s young & trans-global fashiondivas.I JEANS WEAR - Fashion denim wear for the urban youth epitomizing individuality.INSENSE - Elegantly stylish yet practical & comfortable women‟s wear for social occasions.MARIO ZEGNOTI - Romantic fashion formals & smart casuals for stylish & flamboyant men.2008 Page |9
  • 10. FASHION RETAIL MANAGEMENTACROPOLIS - Basic, smart & comfortable line that offers value.INDI-VISUAL - India visualized in a T-shirt range A snap shot of everything that‟s inherentlyIndian in the most colorful manner.Shoppers‟ Stop offers a wide range of brands (more than 400 brands) for the entire family tochoose from. Exclusive and established brands share shelf space to offer an array of choicescustomers across all ages, tastes and occasions. Shoppers‟ Stop is the single largest retailer forLevi‟s Strauss, Pepe, Lee, Arrow, Zodiac, Ray-Ban, Swatch, among others. It is also a launchpad for non-apparel brands like Walt Disney, Tencel, Clarins and Elizabeth Arden.3.6 AwardsReceived the following awards from the “Clothing Manufacturers Association of India” (CMAI):Retail Professional of the year - Mr. B.S. Nagesh (For 3 consecutive years)Advertising Campaign of the year - Shoppers Stop (For 3 consecutive years)“Department Store of the Year” at the Star Retailer Awards“Value Retailer of the Year” to HyperCITY at the Star RetailerAwards.“Emerging Market Retailer of the Year” at World RetailCongress AwardsMr. B. S. Nagesh has been inducted into the World Retail Hallof Fame (The first Indian to be bestowed with this honour)“Retail Destination of the Year” at the Images Fashion Forum(For 4 consecutive years)“Most Admired Retailer – Technology Application” at ImagesRetail Forum“Most Admired Retailer – Leisure Category” to CROSSWORDat Images Retail Forum“Most Admired Retailer – Retail Design & Visual Merchandising” to HyperCITY at ImagesRetail Forum2008 P a g e | 10
  • 11. FASHION RETAIL MANAGEMENT 4 SALES ANALYSISCustomer Entry:The opening of new stores coupled with attractive advertising enabled the Company to attracthigher number of customers in new as well as existing stores. Retailers measure entry asfootfalls, which is the number of people entering the stores. This is computed through manualcount in all stores during trading hours.Conversion Ratio:Conversion is the ratio of the number of transactions (Cash Memo) versus the total customerentry into the stores. Tracking conversion helps the retailer understand the productivity of hisfront-end store employees and the attractiveness of the Merchandise and services. Consequent torecent stores being part of malls, the customer entry has increased but the conversion ratio hasdropped. However in absolute numbers customers converted have shown growth in 2 years.2008 P a g e | 11
  • 12. FASHION RETAIL MANAGEMENTSales:Gross Sales both at chain level and for Like-to-Like stores showed an improvement as comparedto last year. The growth was 34% in gross retail turnover. The sales per sq.ft. have beencomputed on built-up area.Apparel:The Apparel contribution to total sales of the company was 58.6% in 2007-08 as compared to58.9% in 2006-07. There has been growth in Non-Apparel segment which has resulted in Non-Apparel sales percentage growing. This is primarily due to customer buying life style products.Non-Apparel:This category includes Cosmetics, Personal Accessories, Jewellery, Leather goods, Home Wares,Electronics, Books and Music. These lifestyle products have high aspiration value, and as theconsuming class increases, there will be a big surge in the demand for this category. The Non-Apparel contribution to total sales of the Company was 41.40% in 2007-08.2008 P a g e | 12
  • 13. FASHION RETAIL MANAGEMENTPrivate Label & Private Brands:The Company aims to provide a differentiated and unique offering to the customer through itsown private labels as well as through exclusive private brands. The contribution of private labelhas decreased to 20.1% of sales from 20.6% last year and private label sales have increased by28%. The exclusive licensing arrangement with Austin Reed UK to retail men‟s & women‟swear has posted a healthy growth. As a part of its strategy to provide a wide range ofmerchandise to customers, the Company aims to fill in the gaps in the national brand offeringthrough its private labels & exclusive arrangements with private & international brands.Average Selling Price (ASP):Average Selling Price is the Gross Retail Sales divided by the number of units sold. TrackingASP helps the retailer to align the offering as per the customer segment as well as improve theproductivity of the floor space.Transaction Size (Rs.):Transaction size represents the amount spent by each customer on his buying. This is computedby the total sales divided by the number of cash memos.2008 P a g e | 13
  • 14. FASHION RETAIL MANAGEMENTMerchandise Purchase:The company‟s ability to present on the shelves correct merchandise assortments in the rightmix, style, colour & fashion is one of its most critical success factors. A team of Buyers &Merchandisers continuously ensure that the pricing strategy and value proposition are completelyin tune with the customers‟ expectations. They regularly monitor sales trends to optimizeinventory levels. Our well established systems and processes in Buying & Merchandising &Logistics enables the company to efficiently manage the flow of inventory to stores, provideprompt replenishments and manage pricing. The company believes in a broad distribution of riskwith no high dependency on any single supplier and has a diversified supplier base. Suppliers areselected after evaluation based on fairly stringent parameters which ensure the quality &reliability of supply. Alternate distribution channels for inventory have also been put in place asa contingency, should the need arise.Supplier Risks:Shoppers Stop broadly varied offering necessitates alliances with a large number of suppliersfrom various business sectors. In order to mitigate the risk involved, Shoppers Stop enters intoarrangements with vendors in various business formats such as Outrights Buy/Sale or return,Consignment & Concessionaire/Conducting arrangement.Shrinkage:Shrinkage in the retail business is defined as the loss in inventory through a combination of shoplifting, pilferage, and errors in documentation transaction processing that go unnoticed. Theyhave focus on inventory control and have set up a separate department called profitenhancement, which not only monitors Shrinkage on a regular basis but also looks at variousfactors that could lead to Shrinkage at stores and distribution centers. The Profit enhancementdepartment, Store Operations along with the Supply Chain team have worked together andmonitored the Shrinkage level on a month on month basis which has resulted in the Shrinkagepercentage being controlled at 0.47% of the Turnover and the company‟s endeavour will alwaysbe to lower this ratio through proper monitoring and continuously reviewing Inventorymanagement processes and systems.2008 P a g e | 14
  • 15. FASHION RETAIL MANAGEMENTLoyalty program:The Company has pioneered India‟s first retail loyalty program - “First Citizens”. The FirstCitizens base grew from 781,000 to 10,13,000 over customers in this year. During the currentyear, the First Citizens contributed 65% of the Company‟s annual sales. The First Citizenprogram has 3 tiers - Classic Moments (entry level), Silver Edge and Golden Glow. Membersfall into the various tiers on the basis of their spends with the company.First Citizens also earn differential reward basis on their current tier of membership. FirstCitizens receive:• Reward points on all their spends. Reward points can be redeemed for a wide variety ofmerchandise at Shoppers Stop.• Exclusive schemes, benefits and promotions.• Extended and exclusive shopping hours - specially during the festive season. Special previewsbefore the sale periods.• Invitations to exclusive events - both in-store as well as those organized outside the stores.• Home delivery of altered merchandise.• Exclusive First Citizens lounge at select stores to relax after hectic shopping.First Citizens always stay updated with all details pertaining to their membership as well as thebest of offers and privileges available, through a unique service launched last year - FirstCitizens First Through this service First Citizens get all the information that they want on theirmobile phones simply by sending an SMS.In the coming year your Company proposes to announce some ground breaking programs for it‟sFirst Citizens which will not only enhance front end sales but will also strengthen customerloyalty for the company.2008 P a g e | 15
  • 16. FASHION RETAIL MANAGEMENT 5 FINANCIAL ANALYSISThe Company has opened five department stores i.e one at Noida, one at Kolkata and three atNew Delhi during the year, taking its chain of department stores to 27 stores spread across India.The revenue has touched Rs. 11,602 million (previous year Rs.8,741 million), registering agrowth of 33% on y-o-y basis, whereas cash profit stood at Rs. 538 million and net profit atRs. 70 million against Rs. 743 million and Rs. 262 million respectively last year.2008 P a g e | 16
  • 17. FASHION RETAIL MANAGEMENT 6 PRODUCT MIX & PRICE POINTS of SHOPPERS STOPProduct Range Price PointWomen’s apparel:Shirts: formal 449-1395 casual 349-995Bottomwear: formal trousers 549-1899 casual bottomwear 349-1299 jeans 599-2599Mix n match: kurtas 419-1399 churidars,salwars n dupattas 1199Coordinated sets:(includes salwar kameez, churidar kameez and patiyalakameez ) 799-2999Ready to stitch materials 799-2999Skirts 399-999Dresses 699-799Knits (includes tops, dresses, n t-shirts) 399-599Lingeries 250-700Nigtwear 499-2099Women’s accessories:Hand bags 499-3845Fashion jwellery:sets 1390-4970earrings 125-470chains and necklaces 395-3990Fragrances 375-4100watches 1395-18000sunglasses 895-5990Writing instruments 50-1599crystals 99-599socks 99-299Men’s apparel:Shirts: formal 399-2299 casual 375-1299partywear 399-2990semiformal 375-15992008 P a g e | 17
  • 18. FASHION RETAIL MANAGEMENTTrousesrs: formal 599-2895 semiformal 575-1899 Casual pants 499-1399Jeans 799-3299 T- shirts and polos 399-1499Kurta pyjamas and stoles 475-1299Ties 299-1199innerwear 99-599seasonal 99-399Men’s accessories:Wallets 364-1599Watches 599-7995belts 499-9992008 P a g e | 18
  • 19. FASHION RETAIL MANAGEMENT 7 HUMAN RESOURCEThe Indian retail industry is growing by leaps and bounds and is poised for an unprecedentedgrowth. The Company is gearing up to the ride the growth wave and believe that our people willfuel this exponential growth in the future. Shoppers Stop continue to increasingly focus oninternal growth and development of our associates, cutting across levels and functions, throughfocused developmental efforts and growth opportunities.For the year under review, the HR dept. has provided 66 hours of training per associate and 320hours of international training. The company has been able to employ innovative strategies toattract talent from other industries as well as from renowned educational institutions. 104associates have participated in the Company‟s growth through ESOPs.The Company has a well-established system of competency mapping and assessment centredeployment that ensures a fair and transparent vehicle for providing growth opportunities to itsassociates. In the last financial year, 35 assessment centre were conducted covering 360associates across various levels.The company have been able to successfully deploy initiatives to enhance associate satisfactionlevels, which are reflected in the increase in the Associate Satisfaction scores for the fourthconsecutive year in a row. ASI or Associate Satisfaction Index computed through an annualonline survey for all the associates, tracks the satisfaction levels of associates on various workexperience, identifies the current drivers of employee loyalty, tracks improvement over last yearand identifies the current key strengths and weaknesses to take necessary action.2008 P a g e | 19
  • 20. FASHION RETAIL MANAGEMENT 8 EXPANSION PLAN  Geographical reach: The company continues to increase its Pan-India footprint. The Company has plans to increase the number of departmental stores to 41 in the next 3 years. In addition the company will also continue to expand its various other formats.  Hypercity – An entry into mixed retail: the Company has entered the hypermarket segment, which is a high growth segment by acquiring a 19% stake in Hypercity. The company believe that the scope for hypermarkets in India is immense. The store run by Hypercity has shown very impressive performance in the year gone by.  Format diversification: Shoppers Stop, in it‟s constant endeavor to capture wallet share, has diversified into multiple formats viz. HomeStop which retails hard and soft furnishings, Crossword for books, music and stationery, airport retailing by tying up with The Nuance Group AG of Switzerland, and F&B formats comprising Brio and Desi Cafe, and Arcelia, which retails high end non apparel and accessories for ladies.  Preferred partner for foreign players: the Company believes that by virtue of it‟s presence across all lifestyle categories in the departmental format, it‟s strong brand value and it‟s presence in the books and music segment, it is best placed to bring in international brands into the country, there by enriching the product bouquet for it‟s customers and in turn increasing opportunities for product diversification and profit enhancement.2008 P a g e | 20
  • 21. FASHION RETAIL MANAGEMENT 9 STRATEGIC ALLIANCE  Shopper‟s Stop Ltd. has entered into a non exclusive retail agreement with world- renowned cosmetics major Estee Lauder to open M.A.C Cosmetics stores in India.  Shopper‟s Stop Ltd. has a 19% stake in Hypercity Retail (India) Ltd.  Mothercare PLC of UK, the largest specialist retailerfor infant and toddler care, is now in India.  Shopper‟s Stop Ltd.‟s entry into airport retailing is marked by a joint venture with The Nuance Group AG of Switzerland, the world‟s leading airport retailer.  Shopper‟s Stop Ltd has forayed into the Entertainment sector by acquiring a 45% stake in Timezone Entertainment Private Limited which is in the business of setting up & operating Family Entertainment Centers (FECs). It has 5 outlets in Ahmedabad, Hyderabad, Kolkata and Mumbai.2008 P a g e | 21
  • 22. FASHION RETAIL MANAGEMENT 10 PROMOTIONShoppers Stop Ltd.believe that shopping today is not confined to need. It is a newform of entertainment, to fulfill new aspirations and to bring out the new self.Shoppers Stop revealed its new logo in all fanfare with Mr. Shah Rukh Khan as theguest of honour. Upon revealing the new look, Shoppers Stop also announced thenew cause of Think Green that it has taken up. The first initiative under the Think Green campaign is the cause of the Neem Tree. The exclusive brand „Life‟ merchandise is now sold with sachets of Neem seeds to help create awareness and encourage customers to support the cause. Shoppers Stop print advertising campaign, though tongue in cheek, also highlights environmental concerns. Shoppers Stop has been running a TV campaign which communicates the brands new baseline „Start Something New‟. Another exciting feature is the new limited edition of Shoppers Stop shopping bags. The first in the series are shopping bags depicting „Fashion through Ages‟ like the Audrey Hepburn – Breakfast at Tiffany‟s look and The John Travolta Saturday Night Fever look. The company has introduced Shoppers Stop Radio, the first of its kind retail radio format in the country. The Shoppers Stop Radio has two dedicated RJs (Radio Jockeys) who entertain customers while they shop. The radio plays all genres of music and also provides important information to customers related to shopping.2008 P a g e | 22