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| Spencer's Retail to invest Rs 100 cr in expansion plans |
| Press Trust of India / New Delhi Aug 18, 2009, 16:24 IST |
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After having shut down over 100 stores in the past year or so, Spencer's Retail, a subsidiary of RPG Enterprises, will now invest Rs 100 crore in expansion this fiscal and introduce some international apparel brands in the country.
The company is also looking at expanding the US-based Beverly Hills Polo Club (BHPC) brand, with which Spencer's Retail had tied-up last year. It will raise the number of BHPC standalone stores to 10 in the next six months from three at present.
"We are planning to invest Rs 100 crore this year on expanding our retail business. This will cover both the BPCH brands as well as 10-12 large format Spencer's stores we plan to open during next six months," RPG Enterprises Vice Chairman Sanjiv Goenka told reporters here.
"We are in discussions with three international players from the apparel category and we are hopeful of bringing them to the country soon," Goenka said.
He, however, refused to disclose further details, including names, of the brands or the nature of likely tie-up. Spencer's Retail had shut down over 100 of its outlets last year due to low footfalls and sales and high rentals.
"The period of shut downs is now over. We have opened five large format stores during past three months and all have reported sales to the tune of Rs 1,000 per sq ft a day, more than double the normal sales rate. So we are optimistic about revival," Goenka added.
Spencer's Retail has also entered into an agreement with French bakery chain Au Bon Pan and will open the first India outlet at Bangalore in October.
"Besides, we have just finalised agreements with another Western high-fashion apparel player and we will be launching it in the country in the next few months," Goenka added.
"We are ready to launch more such brands under exclusive agreements. Our tie-up with BHPC has shown good results and we plan to have a total of 10 outlets of the brand in the Delhi NCR region within next six months.", said Goenka.
Spencer's Retail today opened the third outlet of the American premium casual wear brand BHPC here in the city. The company, which had a turnover of around Rs 1,000 crore in 2008-09, has registered a growth of 18 per cent in its mainstream grocery business during the first quarter of this fiscal, he added.
Goenka said Spencer's is exploring the option of revenue sharing model with realty owners for its new stores.
"The realty players should also consider this option seriously. Although rentals in many markets are down by 20-25 per cent than the peak rate of two years ago, I believe there is still scope for more course correction," he said.
Asked about plans to raise fresh equity for the company's expansion, he said: "Not at the moment, but we might look into it towards the last quarter of the fiscal."
Goenka added that Spencer's Retail is in talks with other big Indian retail players for co-ordinating their back-end operations.
"But talks are still at the initial stages. All the retail majors need to discuss the issue in depth and it will take time to reach some decision," he said.
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