Hindware Home Retail (Pvt.) Ltd. (HHRPL) is a subsidiary of HSIL Limited, the leading manufacturer of sanitary ware in India. HHRPL is a premium home interior and solutions retail chain under Evok, a brand that was introduced in the year 2008. HHRPL has 17 Evok stores pan India and in the year ending March 31, 2013, HHRPL reported a turnover of Rs. 90 crore.
Evok is an extension of the group’s vision to evolve into a total home solutions enterprise. The core vision of HHRPL is to be a one-stop shop for the consumers looking for solutions to their home interior needs, office spaces and modular kitchen requirements. HHRPL has 17 Evok stores pan India. These mega format stores are spread across 1,70,000 sq.ft. Currently, HHRPL is in the process of expanding Evok stores with its smaller format modular kitchen franchise model outlets in Tier-I and II cities.
Evok stores offer over 20,000 SKUs in categories such as furniture, furnishings, bath products, modular kitchens, modular wardrobe, entertainment units, flooring, lighting and lifestyle home accessories sourced and coordinated from across the world.
Apart from products, Evok also provides ‘Design to Build’, a personalised end-to-end interior planning and design services, which assists home and office makers visualise, choose and create their desired homes. Using 3D technology, consumers can not only put their thoughts into planning but also take a virtual walk-through that enables seamless transition from idea to implementation. This service offering also caters to B2B segment.
Market Size and Market Share
At present, the modular kitchen industry is estimated to be around Rs 2,000 crore and witnessing 25 percent growth YOY, fuelled by demand from non-metro towns. And, India’s franchising industry too is poised for immense growth in the next five years and retail will be one of the key sectors in its progress.
Evok plans to capitalise on these opportunities and are investing heavily to provide franchisor support and knowledge for the entire business project, from site selection, installation, training and promotions.
“HHRPL is covering almost 20–22 percent market share in organised structure,” says Ajay Seth, COO, Evok.
Evok Mega Home Store forayed into the organised home retail market of India in 2008 with an estimated investment of Rs 250 crore. As per the claims by the company, it is the largest home interior retail chain in North India. Currently, Evok is successfully operating 17 retail stores.
The franchisee model will focus only on modular kitchens, a novel and upcoming concept in mini metros as well as potentially lucrative markets, waiting to be tapped. Evok will focus on Agra, Meerut, Jalandhar, Bhopal and Patna in Phase I, which will begin from end of 2013. This will be followed by Phase II for south. Evok has set itself a target of developing 10–12 locations for FY 13-14.
Each franchisee will have to invest around Rs. 25 to 30 lakh and retail space of 1,000– 1,200 sq.ft. The company will invest a similar amount for brand building, training, etc.
Given their premium positioning and the basket of products they offer, the target group Evok serves is mainly between 25–45 years age group.
Evok’s strategy is to capitalise both the main city hub as well as its catchment areas. Location strategy depends on many factors, such as space, price, local consumer shopping pattern and commuting convenience.
Moving forward, specifically for the modular kitchen franchisee business, Evok will be targeting high-street locations. In mini metros, which will be Evok’s focus area with this model, as per our study, we have found it to be suitable.
According to Seth, “Apart from a TVC campaign, we are optimising all available communication platforms from radio, social media, PR to traditional POPs, danglers and print media. From discount coupons, exchange offers, festival discounts, end of season sales, EVOK has round the year calendar.”
Evok will be introducing a customer loyalty programme soon across the country and expects a 15–20 percent contribution in sales besides creating a huge repurchase intents.
HHRPL plans to expand its footprint in mega format for the year 2014–15 with 10–12 new stores. Expansions are planned in cities like Mumbai, Ahmedabad, and Noida, while the rest are in the finalisation mode. At the same time, with another format, HHRPL plans to expand through its modular kitchen and wardrobe franchise model in Tier-I and -II cities. This expansion plan will be done in two phases. In the first phase, focus will be on Agra, Meerut, Jalandhar, Bhopal and Patna. In Phase II, Evok will look at the rest of India. The immediate plans are to develop 10–12 locations or stores by FY 13–14. These will be small format stores of 1,000 to 1,200 sq.ft. floor area, where HHRPL will invest around Rs. 25–30 lakh per store and the franchisee will be investing too. So, in sum, Evok is coming up with 20–22 new locations in the year 2013–14 and this figure will lead to 50 locations till year 2015–16.