Shoppers Stop to exit airport retail business

India’s oldest departmental store chain Shoppers Stop has decided to stop retailing at airports, making an exit from its joint venture partnership with Nuance Group. Its standalone net loss of Rs 21.43 crores for the first quarter this fiscal was attributed to the one-time provisioning of Rs 23.81 crores in its JV with Nuance India.

After inking the partnership in 2006, the company had planned to open five-six stores at international airports, however, it could open only a couple of them since duty-free retailing is an expensive business. Its JV partner, Zurich-based Nuance Group, has been awarded the duty-free contract for Bangalore International Airport and Mumbai International airport.

At a time Shoppers Stop is shutting its stores at airports, airports in Indian metros are emerging as the hottest retail spaces for brands. In fact, for some labels like Fabindia, their stores at airports are best performing outlets compared to other stores at other locations in the cities.

According to the research estimates of the Centre for Asia-Pacific Aviation (CAPA), duty-free spend at Indian airports is expected to reach 1.6 billion dollars (over Rs 10,400 crores) by 2021, witnessing an eight-fold increase in a decade and the combined spend on duty-free, duty-paid and food & beverage will reach 3.5 billion dollars (over Rs 22,800 crores).