Brand Factory to charge entry fee on 'free-shopping' days
, ET Bureau|
Updated: Nov 15, 2017, 05.54 PM IST
MUMBAI: Future Group is doing what perhaps no other retailer has done ever: charging customers a cover of Rs 100-250 to enter its discount fashion format Brand Factory.
The cover charge would be applicable during a five-day promotion campaign from November 22-26, when Brand Factory will charge consumers buying goods worth Rs 5,000 at maximum retail price (MRP) from its 50-odd stores only Rs 2,000, and even that would be returned in the form of free merchandise, gift vouchers and cash back in the company’s mobile wallet. Customers can also redeem the entry fee against purchases.
“We aren’t really charging, because it is refundable,” said Kishore Biyani, founder of the country’s largest retailer. “The move is similar to how pre-booking happens online and in the bargain we are gaining customer loyalty,” he said. But why a cover charge? “It is to encourage serious shoppers, and bring exclusivity to their shopping experience,” said Biyani who is also the chief executive at Future Group.
A year ago, Brand Factory — a discount chain built on the lines of American chains such as TJ Max and Marshalls — did a business of Rs 115 crore during a similar three-day shopping event, selling more than a million pieces of garments. But the crowd was too big to manage. Some 12 lakh people visited Brand factory outlets during the event. This time, the company expects a more controlled environment.
“Last year, there was chaos and we couldn’t service all customers,” said Suresh Sadhwani, business head at Brand Factory. “But now, we hope to limit the customers and curate the footfalls better,” he said. Over the past two years, several retailers have been taking steps to help customers impatient with long lines at checkout counters, especially on weekends.
To cut waiting time, companies, including some restaurants, are making the most of technology to come up with alternatives to beat the queue — deploying staff with handheld devices, setting up mobile counters, and/or offering home delivery.
When US brand Gap was opening its first store in India, it gave tokens to shoppers near the entrance of the mall, allowing them to enter the store in a ‘queue-like’ system instead of them jostling their way as it was expecting at least 5,000 walk-ins on its first day.
Brand Factory is targeting sales of Rs 200 crore during the five free-shopping days when it expects 12-15 lakh customers, Sadhwani said. The event is seen as Future Group’s one-upmanship with online marketplaces Flipkart and Amazon that are offering deep discounts to lure customers. But Sadhwani claimed the chain would not book losses despite the huge price offs during the event. “We have managed our inventory, and brands are sharing discount schemes as well,” he said.
Offline retailers have taken a turn for the better since 2014 when most physical stores reported subdued demand as ecommerce players wooed away consumers by offering huge discounts.
Future Lifestyle Fashion posted a 15% same stores sales growth in the last six months with Brand Factory registering the fastest growth in its portfolio at 24.2 per cent between April and September.
Brick and mortar retailers are also experimenting with global models such as flash sales, offering a single product for sale for a period of 24 to 36 hours.
The cover charge would be applicable during a five-day promotion campaign from November 22-26, when Brand Factory will charge consumers buying goods worth Rs 5,000 at maximum retail price (MRP) from its 50-odd stores only Rs 2,000, and even that would be returned in the form of free merchandise, gift vouchers and cash back in the company’s mobile wallet. Customers can also redeem the entry fee against purchases.
“We aren’t really charging, because it is refundable,” said Kishore Biyani, founder of the country’s largest retailer. “The move is similar to how pre-booking happens online and in the bargain we are gaining customer loyalty,” he said. But why a cover charge? “It is to encourage serious shoppers, and bring exclusivity to their shopping experience,” said Biyani who is also the chief executive at Future Group.
A year ago, Brand Factory — a discount chain built on the lines of American chains such as TJ Max and Marshalls — did a business of Rs 115 crore during a similar three-day shopping event, selling more than a million pieces of garments. But the crowd was too big to manage. Some 12 lakh people visited Brand factory outlets during the event. This time, the company expects a more controlled environment.
“Last year, there was chaos and we couldn’t service all customers,” said Suresh Sadhwani, business head at Brand Factory. “But now, we hope to limit the customers and curate the footfalls better,” he said. Over the past two years, several retailers have been taking steps to help customers impatient with long lines at checkout counters, especially on weekends.
To cut waiting time, companies, including some restaurants, are making the most of technology to come up with alternatives to beat the queue — deploying staff with handheld devices, setting up mobile counters, and/or offering home delivery.
When US brand Gap was opening its first store in India, it gave tokens to shoppers near the entrance of the mall, allowing them to enter the store in a ‘queue-like’ system instead of them jostling their way as it was expecting at least 5,000 walk-ins on its first day.
Brand Factory is targeting sales of Rs 200 crore during the five free-shopping days when it expects 12-15 lakh customers, Sadhwani said. The event is seen as Future Group’s one-upmanship with online marketplaces Flipkart and Amazon that are offering deep discounts to lure customers. But Sadhwani claimed the chain would not book losses despite the huge price offs during the event. “We have managed our inventory, and brands are sharing discount schemes as well,” he said.
Offline retailers have taken a turn for the better since 2014 when most physical stores reported subdued demand as ecommerce players wooed away consumers by offering huge discounts.
Future Lifestyle Fashion posted a 15% same stores sales growth in the last six months with Brand Factory registering the fastest growth in its portfolio at 24.2 per cent between April and September.
Brick and mortar retailers are also experimenting with global models such as flash sales, offering a single product for sale for a period of 24 to 36 hours.
