Noel Tata is looking at the option of closing the Hyper Books discount stores that sell books and music. This will be part of a restructuring of the Tata group’s book and music retail business. He also plans to shut some non-profitable Landmark lifestyle retail stores which sell books, music and movies.
The decision comes at a time when book and music retailing in India continues to be under pressure for both volumes and profits.
Hyper Books, launched in the middle of last year, runs two stores, one in Mumbai and the other in Bengaluru, each around 5,000 square feet in size.
“We are suspending all expansion under the Hyper Books format so as to focus our energies on the Landmark store format,” a senior group official told Financial Chronicle.
Landmark, owned by Trent, competes with the likes of the Raheja-owned Crossword and had a marginally negative performance in 2008-09.
“We may also close some Landmark outlets in tier-II towns, which have not done well, such as Baroda and Lucknow,” the official added. The stores have between 13,000 and 14,000 square feet of space.
Landmark’s chief operating officer, Himanshu Chakrawarti, however, denied any move to shut Hyper Books. “We are evaluating ways to continue and grow Hyper Books,” he told FC, unwilling to reveal more. Nor had any decision been taken on the Baroda and Lucknow stores, he said.
The Hyper Books store in the Mumbai suburb of Andheri is in the same building as the group’s Star India Bazaar hypermarket.
Industry experts say Ahmedabad’s Landmark (5,600 square feet) too was in danger of being closed. But its prospects have improved as its chief competitor, Crossword, has shut in that market.
The discount store chain was launched with much fanfare as an adjunct to the Star India Bazaar. Hyper Books sells bestsellers at discounts ranging between 10 and 20 per cent across.
Landmark had set up a separate team to focus on merchandise for the Hyper Books. The stores carried localised collections that cater to a slightly less affluent clientele, such as those attracted to the value retail offerings of Star India Bazaar. A fourth of the book collection consists English titles, and the rest is split between national and regional languages. It had tied up with Karadi Tales, Jaico Publishing House, T-Series and Shemaroo Entertainment.
Landmark stores, on the other hand, stock typical English and international collections and cater to a somewhat more brand conscious customer.
Crossword, owned by the Raheja- controlled Shoppers Stop, saw its operating profit for the fourth quarter of 2008-09 plunge 59 per cent to Rs 80 lakh. Its retail turnover in 2008-09 too more than halved to Rs 4.19 crore from Rs 9.5 crore in the previous year. Comparative numbers for Landmark have not yet been released.
Source: Financial Chronicle