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Business \n Standard, Mumbai January 27, 2011<\/i><\/p>\n Business \n Standard, Mumbai January 27, 2011<\/i><\/p>\n
Raghavendra \n Kamath
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Star Bazaar, the chain run by Tata-owned Trent Hypermarket, says \n it used the economic slowdown to book properties when prices were \n down, allowing it now to open more stores.<\/p>\n
Rentals of retail properties were 30-35 per cent lower than their \n peak during the economic slowdown of 2008-09, as retailers shut \n stores and scaled back their expansion due to lower footfalls.
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\n Starting the first store in Ahmedabad in 2004, Trent Hypermarket \n runs 10 Star Bazaar stores and plans to double the count by the \n end of 2011. Hypermarkets are larger versions of supermarkets, \n mostly stocking food and grocery, apparel and general merchandise, \n among other products.<\/p>\n
“We have a good property team. Our team quickly went and \n seized the opportunities during the slowdown,” said Jamshed Daboo, \n chief executive officer of Trent Hypermarket.<\/p>\n
Trent Hypermarket did a turnover of Rs 289.7 crore in 2009-10, \n with a net loss of Rs 29.1 crore. Last year, on the sidelines \n of Trent’s annual general meeting, chief financial officer P Venkatesalu \n said the company expected a break-even for Star Bazaar at the \n company level after it attained a critical mass of 25 stores.<\/p>\n
The late hypermarket entrants such as Reliance Retail and Aditya \n Birla Retail came much later but have opened a similar number, \n or more, of stores. Aditya Birla, which opened its first megastore \n in 2009, in Aurangabad, today runs nine hypermarkets. It wants \n to open seven-eight new stores every year. Reliance Retail, which \n opened first hypermarket in 2007 in Ahmedabad, today operates \n 18, under the Reliance Mart label.<\/p>\n
In 2008, Noel Tata, the then managing director of Trent, the \n parent of Trent Hypermarkets, said the company planned to invest \n Rs 2,000 crore to set up 50 hypermarkets in five years. The same \n year, Trent entered into an exclusive franchise agreement with \n UK’s retail giant, Tesco, to access the latter’s expertise in \n supply chain, marketing, stock management and retail information, \n among others.<\/p>\n
“Our essential game plan is to be the best hypermarket chain, \n not the largest. All our efforts are to simplify operations and \n make it foolproof to improve profitability," Daboo said at \n the Retail Leadership Summit organised by Retailers Association \n of India last week in Mumbai.<\/p>\n
Star Bazaar stores are about 70,000 sq ft each. Other retailers \n such as Hypercity are also planning to open stores in that range \n to optimise space utilisation.<\/p>\n
Retail consultant Devangshu Dutta, who works with many national \n and international retailers, does not think Star Bazaar’s slower \n pace of growth is an issue. “Every business has its own logic \n and plans. As long as they achieve their targets, they are a success. \n In the retail business you can pump a lot of money; stores can \n bleed for years. In the last five years, many retailers have lost \n money and have had to scale back," Dutta says.<\/b><\/p>\n
An executive from Trent said the company’s conservative strategy \n paid off, as it remained profitable during the slowdown and did \n not close a single store. Others — Reliance Retail, Aditya Birla, \n Spencer’s, etc closed over 300 stores, mostly supermarkets, to \n stem losses during the slowdown.<\/p>\n
“We were fortunate in the first cycle and have learnt our \n lessons. We have calibrated our growth,” Daboo said at the \n summit. Apart from introducing a live kitchen in its stores, the \n chain has introduced Tesco’s store brands in personal care, health \n and beauty and food in its stores. Star Bazaar will launch more \n products of Tesco, Daboo said.
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Business Standard, Mumbai January 27, 2011 Raghavendra Kamath Star Bazaar, the chain run by Tata-owned Trent Hypermarket, says it used the economic slowdown to book properties when prices were down, allowing it now to open more stores. Rentals of retail properties were 30-35 per cent lower than their peak during the economic slowdown of 2008-09, […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[3],"tags":[],"class_list":["post-3325","post","type-post","status-publish","format-standard","hentry","category-press-quotes"],"yoast_head":"\n