Govind Shrikhande
Managing Director Shoppers Stop Ltd.
Sustainability must be thought about by every individual as well as organizations. Reducing consumption of depleting resources...
Govind Shrikhande, Managing Director of Shoppers Stop Ltd., shares some facts about the Indian apparel retail market in an interview with Fibre2Fashion Correspondent Manushi Gandhi.
Synopsis:
Shoppers Stop Ltd. is an Indian department store chain promoted by the K Raheja Corp Group. It was founded in 1991 and its annual revenue is more than 300 million USD. It has about 61 stores across India and employs about 14000 people. It retails a wide range of branded apparels. The Nuance Group - one of the leading airport retailers in the world and Shoppers Stop Ltd. have formed a Joint Venture called Nuance Group India Pvt. Ltd. (NGIPL), which operates the Duty Free stores at Bangalore International Airport.
Mr.Govind Shrikhande is the Customer Care Associate & Managing Director of Shoppers Stop Limited. He has been in the company for more than 13 years. He started his association with the company as the Vice President of Buying & Merchandising function and has since grown within the company managing roles of the Chief Operating Officer. Before joining Shoppers Stop Ltd, he has been associated with Mafatlal and Johnson & Johnson in the past. He was part of the team that launched Arvind Denim & Arrow.
Excerpts:
Nearly 15% of Shoppers Stop (SS) net worth is invested in IT. Can you tell us how this investment has helped your business? Please enlighten us about what technological transformations have taken place at SS over the last few years?
To manage large retail chains, technology is an enabler & a “Must Have”- hygiene requirement. We deal with multiple seasons, categories, sizes, consumer profiles, different cities & regions & different levels of supplier partners etc. To manage the large scale of transactions, variables & quality – one requires to invest in an end to end ERP system which can support all activities from back-end to front-end and analytics. As a first mover in the area of tech investments, we have been able to be ahead of the market in every area of customer touch points. And our scaling up from 28 Stores to 65 Stores in the last 4 years has gone off well.
What kinds of problems are often faced by leading chain retails with respect to human resources? Do you feel that it is a very demanding industry?
Retail associates are the least appreciated human beings in the society. They stand in the store between 8 to 10 hours every day. They serve the customers, with happy faces every single day. They don’t get to enjoy Diwali, Xmas or Eid. It is a tough job at low salaries; as a result the industry faces large level of attrition.
Few regions have been suffering from the problem power crises; do you think this is adversely affecting the growth of retail sector?
Power is a perennial problem in India. Apart from shortages & cuts, power costs have risen in India dramatically. In some cases they have more than doubled in less than 4 years. This affects profitability of stores.
Indian market and Indian population is very diverse, so do you think that the demand is also very diverse and differs from region to region? According to you, what is the Indian apparel consumption trend at present?
Apparel consumption is a mirror of the society that we live in. As the demographics of India have turned younger & the per capita income is growing – aspirations of Indians have also seen a huge change. From a country that took more than 50 years for fixed line telephones to reach 100 million- we today boast a base of more than 900 million mobile connections that have developed only over last 10 Years. As marriages are becoming a 2 to 3 days affair- the need for specific clothing for specific occasions increased. Also the rise of mall & party culture has helped consumption. The rise in number of working women has driven ladies western wear category dramatically. So overall apparel consumption has a bright future. There are a number of regional differences that exist in India- whether it is sarees in the south or SKD in smaller towns etc. We always keep the customer in mind & fine tune our assortment in terms of categories, brands & price points.
FDI in single brand retailing has been a very critical issue in the country. What are your views on it? Will you partner an international retailer through foreign direct investment?
FDI in single brand or multi brand retail have been more politicized than required. Both have advantages as well as some disadvantages but in the long term the advantages can be higher. We should also work towards developing our cooperative sector- on the likes of Amul & Varana- especially for our food & vegetables & grains. We would be keen to consider a tie up for our hyper city format – once the rules & regulations are clearer.
Huge retail stores face a lot of problem of theft, loss of goods etc. Do you think this is a global problem or just limited to few regions? What is the solution to this problem?
Technology & processes are the right way to handle shrinkage. This is a global problem, but we have been able to successfully keep shrinkage below 0.5 % for the last several years through adoption of many best practices.
The cost of Indian Rupee has been very much fluctuating over the past few months. Over the time the inflation has also increased in the country. Has this affected the Indian retail sector?
Forex changes & inflation do have a very long term impact on all markets. Retail is no exception. As dollar strengthens import costs go up, resulting in higher retail prices. Higher prices lead to inflation, which in turn impacts demand & volume growth drops. So this is a vicious cycle that keeps on posing challenges for all industries, including retail.
What is the role of new influx of digital innovations and marketing opportunities in promoting brands?
Every new change has both advantages & disadvantages. Digital can be disruptive & hence needs to be understood & handled well. We are one of the largest social net worth companies in India & have been recognized as the no 1 company, for two years in succession by Fortune magazine. We have more than 5.1 million fans on our facebook page. Ours is the largest big-box retailer on facebook in India. We are also active on Youtube with more than a million hits on our own channel- Shoppers Stop 1991.
In the history of SS what can be called as thing "which shouldn’t have been" or an advice which you would like to give to a growing retailer?
We have had our share of “Kabhi Khushi Kabhi Gham”. We have learnt from each failure & come back strongly. But two key elements that have always helped us to surge back have been :
1. Focus on customers
2. Strong team work.
What is the role of sustainability in the company’s business and how it ensures to build a sustainable and ethical supply chain?
Sustainability must be thought about by every individual as well as organizations. Reducing consumption of depleting resources like water, power are the two key agendas on which we have worked over the last 4 years.. optimizing all processes and costs also help us on the path to sustainability.
Published on: 16/01/2014
DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.
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