Brick and mortar retailers unfazed by competition from etailers

Online shopping may have caught on but Indian retail chains are undeterred. Future Group for example plans to add 15 new Central stores. Shoppers Stop is planning to open four new stores this year. The new stores will have designated shop-in-shops for private brands to provide a luxe experience. The chain is targeting seven to eight per cent like-to-like growth in the department store segment.

Similarly, Max plans to open 40 to 45 stores at an investment of Rs 5 crores each. The stores will have omni channel capabilities in terms of digital displays and a WiFi environment. With rents declining, and e-commerce facing a slowdown, modern trade has resumed expanding its footprint, especially in large formats (over 50,000 square feet) and medium formats (10,000 to 30,000 square feet).

While e-commerce will continue to grow, and some categories will be bought predominantly online, most Indian consumers will continue to shop for high value products in brick and mortar stores. In a fragmented market like India, department stores have a role to play as authoritative experience environments for the consumer and as platforms to showcase diverse brands. In contrast, in the US Macy’s is closing 68 stores, Sears will close 42 stores, Kmart is closing 108 stores and discount chain Kohl’s has closed 18 stores.