Biyani, who is also group CEO of the Future Group, said he expects the government to issue clarifications soon on opening up FDI in multi-brand retail as well as in certain retail segments. Current Indian regulations do not allow FDI in multi-brand retail.

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“We had been slipping towards the lower end of the middle band over a period of time but are now climbing back,” says Westside COO Gaurav Mahajan . “We do not want to vacate our current positioning by alienating existing consumers but want to spread upwards,” he adds.

The chain is already test marketing an upmarket food section, Gourmet West, in Mumbai. A first in the lifestyle retail segment in the country, Gourmet West sells packaged vegetables and will soon add a sushi, cheese and wine counter to upgrade the experience of its consumers and increase frequency of their visits.

Industry analysts and officials say Westside has been lagging in terms of product innovation and fashion element in recent years when a slew of players — Reliance’s Trends and Landmark Group’s Max at the value end; Pantaloon in the mid-market segment and Shoppers Stop and Lifestyle in the premium market — piped up competition in the lifestyle retail chain space.

“Westside has been a conservative company compared to players like Lifestyle and Shoppers Stop, which expanded quickly between 2005 and 2008,” says a top retail executive, on condition of anonymity .

Westside is the oldest and largest of Trent’s businesses that also include Star India Bazaar hypermarkets and Landmark book and music shops. Started in 1998 after Tatas acquired British retail chain Littlewoods and renamed it Westside, the lifestyle chain now has 49 outlets across 28 cities in India.

Between financial year ended 2008 and 2009-10 , Trent’s stand-alone (largely Westside) revenue grew 8.6% to Rs 542.60 crore against Shopper’s Stop’s 30% growth to Rs 1, 478 crore. However, Westside is ahead in profitability because 85% of its merchandise is in-house brands.

Experts say Westside has lost out on sales productivity (due to lower ticket values) and footfalls in the past few years.

“Westside started out with a great model of private brands but as competition increased they entered fast-selling categories such as watches and cosmetics , which were in most cases managed by third parties. The look and feel then became inconsistent with the overall format,” says the retail executive.

The chain wants to turn that around. It has signed up London-based retail design consultants Fitch to spruce up its store appeal. “The shelf life of store design is 5-7 years. That is something we have not done for a very long time. We are in the process of jumping a few levels to catch up,” says Mahajan.

Westside is also tweaking its merchandise mix to suit micro locations. In its revamped Chandigarh outlet, for instance, a catchment with a high affinity to premium brands, Westside’s private labels have lent more space to brands Vero Moda, US Polo, Ed Hardy and Chicco.

The chain will open 11 large-format stores this fiscal and plans another 15 next fiscal to cash in on the boom in consumption, driven by rising incomes, booming economy and increased aspiration levels of a young consumer class.

Westside is also signing exclusive licensing agreements with international brands such as Aerology in footwear to quickly advance into higher price points.

“There are lots of niche international brands that are looking at being housed inside a department store rather than on their own in India as quality real estate is very expensive,” says Mahajan.

It has tied up with designers such as Wendell Rodrigues and Priyadarshani Rao and introduced premium in-house brands, Ascot for men and Nuon to drive this premium positioning.

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Group company Pantaloon Retail India, which opened its 50th store spread across 31,109 sq ft here, plans to add another 50 Pantaloon stores across metros and smaller cities. “In the next 3-4 years, we are looking to add around 50 new Pantaloon stores across the country,” Future Group Director and CEO (Retail) Rakesh Biyani told reporters here.

He said 18 such stores are in the process of being opened and agreements with various real estate developers have been signed for a dozen more. The company will focus on top seven cities in India along with the various state capitals under its expansion.

A Pantaloon store is spread across 25,000 sq ft to 30,000 sq ft on an average, he added. The funds for the new Pantaloon stores will be part of the Rs 2,100-crore investments to be made by the Future Group over the next three-years, which was announced earlier this month.

Besides, the group is also changing the look and feel of its Pantaloon stores by making it more colourful and vibrant, starting with the latest one here, with a focus to attract more young consumers. “With the new ambience within the store, we are targetting young high spending consumers. In a period of two to three years, our existing Pantaloon stores, especially in the metros will also be revamped,” Biyani said.

The Pantaloon stores contribute 15-20 per cent of Pantaloon Retail India’s total sales, a company official said. Pantaloon Retail India had posted a turnover of Rs 2,581.42 crore in the quarter ended September, as compared to Rs 1,954.21 crore last year. Its net profit stood at Rs 42.76 crore, as against Rs 26.33 crore the year-ago period.

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The company, that runs a chain of outlets such as Pantaloons, Big Bazaar, Food Bazaar, KB’s Fair Price and rural model Adhaar, will invest around Rs 600-700-crore every year for the next 3-years, its CEO, Kishore Biyani , told shareholders at its Annual General Meeting (AGM), here.

Pantaloon, a part of the Future Group, would be using the funds to add 15-million square feet retail space into its portfolio by 2014, Biyani said. “The funds will be used to add 3-million sq ft of retail space every year for the next three-years. This will be done across formats in both the value and lifestyle segment,” Biyani said.

Currently, it runs its outlets in 80 cities and plans to add another 30 cities in three years. However, about 60 per cent of the expansion would be carried out in the top eight metros, he said. Pantaloon presently has a presence across 80 cities in the country and plans to expand operations to 110 cities going ahead.

It also runs some regional brands such as Depot (book store), Shoe Factory, Brand Factory, Blue Sky, all, Top 10 and Star and Sitara. Besides, its subsidiary, Home Solutions Retail (India) Limited operates Home Town, a large-format home solutions store, Collection i, selling home furniture products and E-Zone, focused on catering to the consumer electronics segment.

Pantaloon Retail is currently going through a major restructuring exercise and would be a pure retail company in the next two-years. The company will complete 25-years in 2012. “In the next 2-years, we are going to see a pure retail balance-sheet through value unlocking. We want to bring all the retail formats under one umbrella,” Biyani added.

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The firm, which currently owns 21 private brands such as John Miller, Care Mate, Mohena, Koryo, was set up by the promoters of retail chains Big Bazaar and Pantaloon to recreate its private labels as conventional brands, besides providing brand consultancy services.

“We are looking at launching 4-5 brands over the next six-months. These will be across 7-8 categories. Some will be in the FMCG space and some in consumer durables. We will be entering into new categories with Koryo, our consumer durable brand,” Future Brands’ CEO and Managing Director, Santosh Desai, told reporters on the sidelines of AIMA event here today.

Koryo already has its presence in categories such as microwave ovens, TVs and other small appliances. The consumer durables category is growing at 40 per cent YoY, Desai said.The new categories and products will be available in the market in the next six-months, he said.

“We see a growth of about 50 per cent in our private brands and expect the private brands to keep growing at the same rate over the next few years,” Desai said, adding that Future Brands contributes around Rs 1,600-crore to the topline of the group.

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The Mumbai-headquartered conglomerate Future Group’s listed retail entity, Pantaloon Retail (PRIL), has reported a core retail turnover of Rs 2,493.7 crore for the June quarter, up 49.98% from the corresponding period last year. According to a company release, its consolidated annual turnover increased 27.6% to Rs 9,786.9 crore for the year 2009-10.

However, the company’s core retail businesses posted a total turnover of Rs 8,926.1 crore compared with Rs 6,341.7 crore in the year-ago period.“This result is a reflection of (the)company’s constant efforts to accelerate growth,” says a senior retail analyst with an international brokerage house. “Revival in economy and increased spending have reflected in the results.”

The store’s sales growth in value retailing stood at 9.5%, lifestyle retailing at 13.7% and home retailing registered a 12.02% growth, says the company release. During the year, to consolidate the company’s retail businesses, it had merged the home solutions business, Home Solutions Retail India (HSRL) with itself. Also, a wholly-owned subsidiary, Future Value Retail (FVRL) was created to operate its fast-growing value retail business. The company’s core retail business for the current year includes the retail businesses of PRIL.

Giving a future outlook for the industry, the company’s senior official said that consumers are coming back to shop and within the sector, women consumers are increasing compared with men, which is a good sign for the industry as a whole. On Friday, the company’s stock closed 2.2% up at Rs 473.50 on Bombay Stock Exchange (BSE).

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Pantaloon Retail (India) Limited, is a large Indian retailer, which is part of the Future Group, and operates multiple retail formats in both the value and lifestyle segment of the Indian consumer market. Headquartered in Mumbai, the company has over 1,000 stores across 71 cities in India and employs over 30,000 people, and as of 2010, it was the country’s largest listed retailer by market capitalization and revenue.

With effect Jan. 1, the company separated its discount store business, which includes the Big Bazaar hypermarket and the Food Bazaar supermarket businesses, into Future Value Retail Ltd., its wholly-owned subsidiary, so that the company may be listed independently.

The company’s brands include Pantaloons, a chain of fashion outlets, Big Bazaar, a hypermarket chain and Food Bazaar, a supermarket chain. Some of the company’s other regional brands include, Depot, Shoe Factory, Brand Factory, Blue Sky, aLL, Top 10 and Star and Sitara.

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The RBI direction came as the foreign shareholding in Pantaloon Retail by foreign institutional investors or non-resident Indians or persons of Indian origin under Portfolio Investment Scheme has reached the overall limit of 25.77 per cent of its paid-up capital.

Pantaloon Retail is the flagship company of Biyani’s Future Group. Shares of Pantaloon Retail today closed at Rs 387.25, down 4.9 per cent from the previous close.

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After launching the Dreamline range under the concept of co-creation with Hema Malini, Future group is aiming to boost its sales with the newly launched Sach brand, which will be co-created by cricket giant Sachin Tendulkar. While Dreamline is a range of home making and home improvement products, Sach has a presence in apparel and personal care segment. The group aims to achieve at least 25 per cent of its in-store toothpaste sales from the private brand within six months.

“Co – creation involves a well known person who comes together with an organization in a relationship which is much more than being a brand ambassador. The co-creator is closely involved in the development of the products, which invariably are products that are aligned to the persona of the co-creator. All products which are launched under the Sach brand name must have his approval before going ahead.

He is involved in prototype evaluation process; feedback from which is incorporated in the product. He plays a very important role in product development, and is involved in practically all phases of product development as well as the go to market strategy, the pricing etc., said Devendra Chawla, Head—Private Brands, Future Group. He however declined to comment on the revenue sharing percentage that the celebrity would garner.

The company, which launched the toothbrush range under the Sach label six months ago, plans to launch more products under the same label by the end of 2010. “We have apparel range and in FMCG we have started with oral care category with a toothbrush launch and more in the FMCG category to come out soon,” Chawla added.

While the company does not plan to go into co-creation for all its private brands, it is looking at expanding its apparel range under the Sach brand. Besides Sach, Future Group has launched a series of private brands ranging in foods with Tasty Treat, Home and personal care range with Cleanmate, & Caremate, staples with Fresh & Pure and Premium Harvest.

The Kishore Biyani-led Future Group has businesses spanning across the consumption space. While retail forms the core business activity of Future Group, group subsidiaries are present in consumer finance, capital, insurance, leisure and entertainment, brand development, retail real estate development, retail media and logistics.

Led by its flagship enterprise, Pantaloon Retail, the group operates over 16 million square feet of retail space in 73 cities and towns and 65 rural locations across India. The group’s speciality retail formats include supermarket chain – Food Bazaar, sportswear retailer – Planet Sports, electronics retailer – eZone, home improvement chain -Home Town and rural retail chain – Aadhaar, among others.

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Pantaloon retail has invested close to Rs 170 crore in home solutions retail and holds approximately 67% stake, while the rest is held by others that include ICICI ventures and Kotak SAEF India Fund. The two collectively invested Rs 120 crore in Home solutions in 2006, and Rs 150 crore in the rights issue in 2009.

The decision to merge was taken last year to have better synergy and efficiency in the retail business, however the board approved the demerger of the consumer durables, home imporvement and furniture businesses from Home Solutions into Pantaloon now, according to a filing with the exchanges.

These other share holders will now be alloted preference shares and equity in lieu of their investment in Home Solutions, which would be close to Rs 500 crore according to analysts. The deal is subject to the company obtaining statuary approvals and share holders nod.

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