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Shoppers Stop Ltd is in the process of rightsizing its HyperCity outlets and also changing the product mix in the stores to expedite the profitability of the model.
The company currently has 12 HyperCity outlets across the country. “As we realised that some of these stores are too big, we are downsizing them, and also increasing the share of fashion products in the product mix to enable the model to see store-level profits in the next two-three years,” said Govind Shrikhande, Managing Director and Customer Care Associate, Shoppers Stop Ltd.
Other models
According to him, the share of fashion products in the mix is being increased to 10 per cent from 5 per cent, and the plan is to take it to 15 per cent in future. “Profit margins on fashion products is higher at 19 per cent, and is going up,” he reasoned.
Talking about its other store models, he said its department stores have around 16 per cent private label products, while in home concept stores, it is 25 per cent. This will be increased to 18 per cent and 28 per cent, respectively, in the next two years. The K Raheja group-promoted company is also planning to expand its footprint across models. It has department stores (Shoppers Stop); large-format hyper market stores (HyperCity) and home concept stores (HomeStop). The plan is to add 8-10 department stores, 2-3 hypermarket outlets and 2-3 home concept stores this year. “We will invest up to Rs 125 crore for the purpose,” he said.
Shrikhande was in town to launch the company’s 13{+t}{+h} HomeStop store in the city. It is also opening its 56{+t}{+h} Shoppers Stop and 14{+t}{+h} HomeStop in Chandigarh.
Home segment
With the evolving and growing realty scenario in Chennai, the consumption of categories in the home segment is growing.
“We already have a sizable base of loyal customers who shop at the home sections in our Shoppers Stop stores in the city. This existing catchment of customers is indicative of their desire for a dedicated home shopping experience,” he said.
Shoppers Stop, on a consolidated basis, expects to post over Rs 3,000-crore turnover for the 2012-13 financial year.
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