Tata Group’s Trent Hypermarket, which operates Star Bazaar, is planning to focus on its ethnic wear collection under its private labels this festival season.
“Ethnic wear is going to be a focus area this year and we intend to push our brands in private labels under this collection during the festival season. Private labels are generally 20-25 per cent cheaper than the rest of the brands,” said Jamshed Daboo, CEO, Star Bazaar.
Of late, Star Bazaar has been steadily increasing its private label offerings to get better margins and improve profitability for its formats.
Even Tesco (with whom it has a franchise agreement) has steadily been unleashing a range of products in the food and grocery segment and this will soon get extended to general merchandise. A host of items such as clothes hangers, toasters and even iron boards would get included at the Star Bazaar stores. There is also some amount of cross selling of Tesco and Star Bazaar’s private labels in the group’s lifestyle store Westside.
“Tesco brands are generally more expensive, but we have made sure it does not clash with the private labels of Star Bazaar. We have introduced some of our private labels at Westside stores as it has a gourmet section,” added Daboo.
Apart from private labels, Star Bazaar would also be giving 20 per cent discount in other categories such as gifting, health and beauty, select consumer durables and kids wear during the season.
“Some of the Tesco products, if they happen to come under this category, will also be offered a similar discount. We are looking forward at a double-digit growth during the festival season as our base is still small,” he added.
With 15 stores under it fold, Star Bazaar is launching more stores in places such as Pune and Bangalore in the next few months with the possibility of scaled down formats. “Today, the gross area of our stores measures between 30,000 and 45,000 sq ft, but we are open to smaller formats going forward,” said Daboo.
Meanwhile, with FDI in multi-brand retail being allowed, Tesco which already provides back-end support and infrastructure to the retailer is expected to have a more active role in the future. “The Tatas would definitely be open for a tie-up in the front end as well now that FDI has been opened up in India. The group has always believed in forging deeper relationships with its partners,” said Ramesh Jude Thomas, Managing Director, Equitor Consulting, a brand value management firm, which has the Tata Group as one of its clients.