Infinity Retail, a subsidiary of Tata Sons, has decided to stop expansion of its Croma brand of electronics stores to new cities.
“We will close this financial year with 52 stores and have withheld expansions into new cities, except Rajkot in Gujarat. We have adopted a hub-and-spoke model and unless the distribution centre is located close to the stores it is not possible to have stores in new cities,” said Ajit Joshi, CEO & MD, Infinity Retail.
With Tata Sons, its parent company, investing in the retail venture, funding has not been an issue with Croma.
“We will, however, continue to launch new stores in the cities such as Mumbai and Delhi, where we are already present but no new cities will be added as we have decided to stop all expansions now,” said Joshi.
Meanwhile, Croma has entered into a revenue-sharing contract with mall-owners and landlords. “Unlike in the past, where real-estate owners were not ready to share revenues, today they have become more professional and are open to revenue-sharing. This has made our business more vibrant,” said Joshi.
Considering the slowdown has not affected durable retailers, Croma is now looking forward to the festival season ahead. For instance, sales in categories such as laptops have been on the rise, with Sony’s Vaio and HP registering high volumes. There is an increased focus on developing the area of personal care with less established brands in the segment. Products such as foot spas, hand-held massagers, face-steamers and, more recently, jewellery cleaners have been introduced under the Croma brand, with private brands expected to contribute nearly 20 per cent of the turnover.
Adding more exclusive items to its portfolio, Croma has tied up with Chef Sanjeev Kapoor’s company Wonderchef for range of imported utensils and cookery and bakery products from Italy.
Source: Business Line