Home Retail Retailers raise a toast to “Manchester of the East”

    Retailers raise a toast to “Manchester of the East”

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    Ahmedabad, popularly known as the city of textile industries, has become a robust retail destination quite recently with the launch of five malls in quick succession. The city has also been witnessing a series of infrastructural development and has already emerged as one of the most promising cities in the country in terms of economic prosperity. It is said that the city boasts of the credibility of a focused approach towards development from the Gujarat State Government. In January 2009, the government hosted Vibrant Gujarat Global Investors’ Summit in Ahmedabad and in one go, it has signed over hundred MoUs with leading national and international players for various projects to be developed across the state. Thus, considering the huge potential the city has to offer, retailers and real estate developers consider Ahmedabad as one of the prospective locations for strategic expansion and keep it on the radar next to metros like Delhi and Mumbai.

    The city formally witnessed organised retail boom with the launch of 3.24 lakh square feet Gallops Mall, followed by Mall and the trend is enhanced when 4.5 lakh square feet Iscon Mega Mall on SG Highway opened its door for brands including Tommy Hilfiger, Giordano, Esprit, Westside, Benetton, , ColorPlus and Reliance with Mega Mart as one of its anchor tenants, the shopping behaviour of the local residents are getting transformed. With the success of the mall, a bunch of developers have also shown keen interest in the market and consequently joined the league. With these new malls, the expectation of a convenient leisure space for Amdavadis has been met to a large extent besides the experience of exposure to the national and international brand mix. Other operational malls in the city include Dev Arc Mall, which is spread across 3.5 lakh square feet, SRS Shittal Varsha-3 of around 40,000 square feet and Gulmohar Park of around 2.20 lakh square feet.

    Describing the potential of the market for high-end brands, Sanjay Thakker, chairman of Benchmark Cars, which promotes and distributes Mercedes cars in Gujarat, stated, “The state is becoming a potential luxury market. We realise that there is significant demand not just from Ahmedabad but also from the adjoining cities, towns and rural areas”.

    However, the city is yet to witness another round of retail development, which would be brought about as as , the close to one million square feet mixed use project promoted by Alpha G:Corp, starts getting operational. The project, which has 700,000 square feet retail-cum-entertainment space, will house around 110 retail brands, besides anchor stores, hypermarkets and multiplex as the key tenants. Other upcoming projects include Venus Infrastructure promoted Venus Square mall of around 2.25 lakh square feet, which is coming up on CG Road in the city.

    Speaking about the retail prospect in the city, , MD, stated that Ahmedabad has lot of industries and also is a very buoyant market for investment. So employees from national and international financial institutions add to the population besides a huge crowd of students who keep coming in the city.

    Shweta Pillai, senior marketing executive, Venus Infrastructure & Developers Ltd, stated, “Ahmedabad has now gained the tag of mega-city. Quite a good amount of infrastructural development has happened and more is in the pipeline. Moreover, the two major retail growth factors like increasing middle-class with high disposable income and increased brand consciousness among the target audience are also in place.”

    Retail experience:

    The Mobile Store, one of the premier mobile retail chains in India, finds Ahmedabad as a very good market to grow. With 30 operational stores in Ahmedabad out of the total 80 stores in Gujarat, the retailer is eyeing further expansion in the city. Speaking about the purchase behaviour of the customers in the city, Agarwal stated, “Traditionally for the telecom industry, Gujarat is a very good market. People in Ahmedabad are pretty much acquainted with gadgets and related equipment.” Elaborating further, he stated that people in Ahmedabad follow the latest fashion trends along with the value for money they spend.

    Wellness retailer , which operates its store at Iscon Mega mall in Ahmedabad, also finds the city very prospective for its brand. Sharing the brand’s performance in the city, Shriti Malhotra, general manager, , said, “Wellness retailing is comparatively a new phenomenon in India, however, customers in Ahmedabad, like in the rest of India, relate extremely well to ’s positioning as a natural brand. The brand has been received very well in the market. The store performance is getting stronger with increasing footfalls and transactions and the customers have responded very well when we have reduced prices of some of our best selling products in March this year.”

    Besides stores in malls, high streets have also been doing equally well in Ahmedabad. One such retailer is V Mart, which is operational in the city since 2003. Sharing his retail experience, , CMD, V Mart said, “V Mart has ventured on its retail operation from Ahmedabad. The experience says that people in Ahmedabad are potential buyers and they look at value for money.” He further stated that the city is crowded with lot of young customers who are quite fashionable. “Our focus is always on youth and family which match with the array of products that we offer,” he added.

    Ahmedabad at a glance

    Population: 35 lakh (as per 2001 census)

    Male-female ratio: 1000: 886

    Average monthly income (as per Venus Square estimate): Rs 10,000-25,000 for people in between age group 18-25, Rs 26,000-35,000 for people in between age group 26-35, and Rs 36,000- 1 Lakh for people above 35 years.

    Retail brands present: Wills Lifestyle, M&B Footwear, CCD, , Provogue, Etam, Metro, Landmark, Reebok, Arvind, Timex, ColorPlus, Gas, Tommy Hilfiger, Esprit.

    Operational malls: Iscon Mega Mall, Himalaya Mall, Dev Arc Mall, Gallops Mall, SRS Shittal Varsha-3 and Gulmohar Park Mall

    Upcoming malls: AlphaOne, Venus Square

    Shopping trends

    Elaborating on the purchase behaviour of the customers in Ahmedabad and their shopping trend, Pillai stated that shopping trend sees a wave during the weekends. During promotional sales, festivities like Diwali, Rakshabandhan, or in-house celebrations like weddings and cultural festivities are also focused upon. Besides this a major chunk of the buyers are impulsive shoppers. Since there is a demand for one stop shopping centers, she stated that a combination of brand and product mix will be a hit in the market.

    Expectations

    After the success of high-end brands like Tommy Hilfiger and Esprit in Ahmedabad, Major Brands is all set to launch in the market in September this year. The company will open its female fashion brand store Promod in Gulmohar Park. Speaking about the plan, Kamal Kotak, director, Major Brands, stated that the company was a bit reluctant to go in the market sometime back because of doubts on the availability of right catchment. “But when we saw that the Tommy Hilfiger store was successful in the region and even Esprit was doing well, we thought that this would be the right time to go to the city and identified Gulmohar Park as the location,” informed Kotak. The mall is strategically located on the Satellite Road, which is eventually a good catchment because of the younger population and the working women in the age group 22-35, stated Kotak.

    Sharing his expectation from the market, , marketing manager, , the company engaged in retailing Denmark-based high end sleep and comfort products brand Tempur in India, stated that the city has a vast business backing and thus the spending capacity lies there in. “Out of the total population in Ahmedabad, 5 per cent of them are luxury lovers and another 15 per cent are solution seekers. In addition, 8 per cent of the population consists of technology lovers. Moreover, Ahmedabad is one of the richest cities of India with per capita income more than the national average and there lies the prospect for our brand,” stated Sachdeva.

    Malhotra believes that Ahmedabad is a city with tremendous potential and therefore more new brands and retailers need to set up stores in the city to provide a variety of shopping options and experiences to customers. “This is important to grow the retail base for organized retailing in the city for the long term,” stated Malhotra.

    But Kotak at Major Brands is quite conscious of the market and said that Ahmedabad can never be treated at par with cities like Delhi and Mumbai. “We can’t compare Ahmedabad with Mumbai or Delhi. It’s a small market and we can’t expect a turnover as big as we see in our stores in Delhi or Mumbai,” added Kotak.

    The missing links

    With the legacy of being the city of premier educational institutes including Indian Institute of Management, National Institute of Design, Mudra Institute of Communications, , Entrepreneurship Development Institute of India and BJ Medical College, the city has enough young population for brands to cater to. But most of the operational malls and the upcoming malls are still awaiting a proper mix of brands for the youth to attract them to their malls, observed the developers. Out of the six operational malls, two malls have multiplexes with them. Again, PVR is not an option to Amdavadis till date. Big Cinemas is located at Himalaya Mall in the city, besides Cinemax and City Gold multiplex as the other two options for localites. Now the mall developers and retailers are trying to identify the missing links and fill in the gaps in the long run in Ahmedabad.

    Sarimul Islam Choudhury