Retail brands back on expansion spree; DLF, Select Citywalk see significant jump in store openings

After more than two years of business uncertainty due to the lockdown and movement restrictions courtesy the Covid spread, retail brands are putting their expansion plans back on track. Organised retail brands are adding a number of stores and are even looking at adding new format stores in both shopping malls and high streets. “Well-capitalised retailers are looking to open 15 per cent more stores compared to last year; some are also looking to add new formats. Factors like increase in consumption, consolidation in small retailer categories and customers moving from unorganised to more organised retail experience, are facilitating this trend,” said Pankaj Renjhen, COO & Joint MD, ANAROCK Retail.

The pandemic had hit the industry hard, forcing many to shut non-profitable stores during the lockdown and stall expansion plans. However, with many moving past their pre-Covid numbers, the industry is more confident. In fact, according to a CBRE report, India’s retail leasing is expected to cross the pre-Covid levels this year. The country is likely to see a 25 per cent jump in new store openings in 2022 as compared to the previous year. “We are currently in the process of constructing an FAR of 60,000 sq ft. In addition would be 50,000 sqft from the existing retail portfolio. This opens a new vista of 1 lac sq ft of new leasable area. The plans for expansion and fit-out are back on track. We currently have 8 percent of the shopping centre’s space either under fit-out or being redone for new store spaces. Heads of several international brands have visited the shopping centre in the last few days,” Yogeshwar Sharma, Executive Director & CEO, Select Infrastructure Pvt Ltd, told FinancialExpress.com.

Similarly, DLF Malls too is witnessing recovery with organised retail bouncing back to pre COVID levels. “DLF Malls, with its strategic vision, has been successful in strengthening its brand portfolio and has added 130 unique brands across its retail and F&B categories in its 8 premium and luxury properties in Delhi-NCR. At a portfolio level, DLF Retail ended the financial year March 2022 with over 97% occupancy,” Pushpa Bector, Executive Director, DLF Retail, told FinancialExpress.com.

A look at the expansion plans of retail brands

ASICS: “Currently, we have 72 retail mono brand stores operated by the franchisees in India. We plan to add about 17 stores in 2022, majority of which will be in tier-II and -III towns,” said Rajat Khurana, Managing Director, ASICS India and South Asia.

Madame: “This year, we have launched 7 stores including FSOs & EBOs. We are planning to add another 15-20 stores in this financial year and the average size for these stores would be 1000-1200 sq ft,” said Akhil Duggar Jain, Executive Director, Madame.

Numero Uno: “We have launched approximately seven stores so far this FY. We plan to open around 35 more stores across the country with average store size of 700- 1000 sqft,” said Narinder Singh Dhingra, CMD, Numero Uno.

FabAlley & Indya: “Our plan this year is to double our offline footprint by adding 25 more EBOs, three of which have been recently launched. The stores will be a mix of company-owned stores and franchisees and the average size of these will be 600-800 sqft. We’re also looking at increasing our footprint of large-format stores by adding another 100 shop-in-shops in the next 12-18 months,” said Atul Chachra, Vice President, Retail, FabAlley and Indya.

Kunal Rawal (label): “This year, we will be relaunching our New Delhi store in DLF Emporio into a bigger space in the mall which will be about 1000 sqft. Not just that, in 2022 we will also be opening a standalone store in Kolkata,” said Kunal Rawal.

Kiehl’s: “We have recently opened our 15th store at Jio Drive, BKC Mumbai which is the brand’s first sustainable store in India. We plan to continue to expand our reach,” said Santosh Kumar, DGM Marketing, Kiehl’s India.

ORRA: “We have recently opened our largest store in Andheri West in Mumbai. We are opening two new stores, one in Preet Vihar in Delhi and the Other in Haldwani, Uttarakhand within the next 15 days. We are looking at opening 22 more stores during the coming year,” said Dipu Mehta, Managing Director, ORRA.

The segments witnessing more growth

The Retailers Association of India (RAI), in its latest retail business survey, indicated that sales in March 2022 showed growth of 28 per cent as compared to the sales levels in March 2021(Y-O-Y), and 12 per cent when compared to sales level in March 2019. The categories leading the store openings currently are fashion, electronics, beauty and cosmetics and QSR food chains, confirmed Pankaj Renjhen.

“While demand is heavy across all sectors right now, we are seeing heavy demand in athleisure and beauty segment,” said Yogeshwar Sharma. For DLF Retail, international fashion, international luxury segment, athleisure and F&B are the categories seeing an uptick.

While the expansion spree is on track, shopping malls are now also increasing rentals at their properties. “We were back to actual rentals during July-August 2021. We have now increased our rentals by about 20-25 per cent because we see the demand and retailers are able to lease at a higher price because they also see the potential,” said Pushpa Bector.

Where will these new stores be?

Retail brands are leasing across high streets and malls, depending on the locations, the proximity of the locations to their target audience, etc. While some brands are inclined more towards shopping centres, others see potential in spaces depending on factors like neighbourhood, proximity from residential areas, other stores in the area, experiences on offer, among other things. “It all depends on footfalls and customer traffic. As we do a detailed study of the market and consumer dynamics, we choose whichever suits our business needs. The location must make financial sense as well as keep in mind that we are a premium bridal jewellery brand,” said Dipu Mehta.

Another trend that’s taking up this expansion drive is opening up of more stores in tier-II and -III towns, with ‘high demand for organised retail brands coming from these areas’.