In a candid conversation with Indian Retailer, Suresh Sadhwani, Business Head, Brand Factory, shares his views on the changing consumer behaviour and value shopping.
How do you see the retail industry shaping up?
The overall economy has a positive swing, the markets are looking up and the sentiments are high. In the last few months, we are seeing a consumerist economy, where people are actually loosening their purse strings and shopping. Retail has been growing with new brands and new format of stores entering the country.
Also, new retail brands are entering in various segments, apparels and non-apparels. Not just that, but retail landscape is also evolving, getting new buyers in the marketplace. Hence, with more investment coming in, various formats of retail looks promising in the coming year. At Brand Factory, we are creating expansion plans and growth targets to ride the growth wave and opportunity.
Do you think this online revolution will impact the brick and mortar presence in the country?
The market is large enough for all and more players to co-exist as India is a very young country and according to the recent studies on the economy, we have a burgeoning middle class. Currently most organised retail is concentrated in tier 1 and II markets, so in the first run, there is a huge landscape to cover. Also, there are additional consumers entering the consuming market. Hence, there’s enough opportunity for a lot of players.
Have you observed any significant changes in the consumer behaviour?
The consumer is now more evolved than 5 years back. They have become more conscious consumers, who now seek more value for the money. Be it on hi-fashion brands or white goods, the consumer has turned into a smart shopper, looking for the best deals and more bang for the buck.
How full price consumer is moving towards value shopping?
As mentioned in the above statement, the consumer has become more smarter and wants to get more value out of his spend, which can be through moving to value products or buying brands smartly through discount/promos and offers.
As more and more brands are venturing into the country, how do you see this trend?
The trend is positive and promises growth.
What is your pricing strategy as compared to your competitors?
We have no direct competition as we are India’s largest chain of discount fashion stores. We offer 365 days of discount on more than 200 brands in store. We follow a simple discount strategy, where we pass the benefit to the customers on products with lower margins and cover up on scale. We keep our overheads including rentals low. Therefore, we can survive with lower margins as compared to full price stores.
What are your expansion plans?
We have grown from 27 stores to 41 stores within a year through new store opening and a recent acquisition of a discount retail chain called “COUPON”. Further, we plan to open 10-12 stores every year. Moving forward, we aim to cover the width and breadth of the country and reach 100 stores by 2020.