Shoppers Stop banks on hyper local services to push e-commerce

As it waits to develop its own e-commerce capabilities, Shoppers Stop is expected to enhance its dependence on hyper local services of start-ups like Zop Now.

While it has its own omni channel strategy in place, implementation of the same is not expected to happen immediately, with the retailer pushing back its launch to 2017.

“We are working with Zop Now in Bengaluru and would be leveraging this association to other cities. Since we cannot fight the trend of hyper locals, there is no option but to join it. Right now we do not have any logistics support to serve our customers.

“Our omni channel presence is being done in phases and will take over 25 months, as we will have to create master data centres and warehouse management systems” said Govind Shrikhande, Managing Director of Shoppers Stop.

At the same time, Shoppers Stop has put up its own site, which is not a market place model, and is expecting 10 per cent of its sales to get generated from e-commerce channel in the next three years for which it has earmarked an investment if ₹60 crore.

“Our own site has yet to stabilise and we have to give it some time before it can be scaled up. It is a real store and not a market place model but with far deeper offerings,” added Shrikhande.

Meanwhile it will continue to sell through Snapdeal’s marketplace, having forged a tie-up this year. It has no option but to leverage the strength of one of the largest e-commerce players to ride the boom in online retailing.

On the other hand, furniture start-ups like Pepper Fry are also using the physical presence of Home Stop, the furniture vertical of Shoppers Stop.

However, dependence on online retail will be pertinent for brick & mortar retailers, since physical expansion of stores may not always be possible.

With physical retail expansion slowing down due to lack of mall development, Shoppers Stop is also rationalising its future store expansions. Shrikhande added, “There was a time when we were adding 10-12 stores in a year. As there is not much pipeline of malls available, we will be adding four stores every year.”

It is planning two new stores in Delhi-NCR before the year ends.

Looking forward to the festive season, Shrikhande adds, “The market has been slow, but we expect the second half to pick up on the back of the festival season, followed by the wedding season.”