Prominent malls are asking brands to either share revenues from their omnichannel operations or altogether stop such activities from their shopping centres.Select Citywalk and Pacific in Delhi and High Street Phoenix, Oberoi and InOrbit malls in Mumbai among those either incorporating such clauses in their rental agreements or objecting to retailers from carrying out omnichannel from malls.
“Wherever we enter new agreements or go for renewals, we tell retailers, in case of any e-commerce activity with fulfilment happening from the store or if there is an order that happens from the store, we request for revenue share on the same principle as we do from stores,” said Anupam T, vice-president at Oberoi Mall in Mumbai. “If existing retailers don’t have permission for e-commerce, we don’t allow that. If the e-commerce is not defined clearly in the purpose of the agreement, then we can always restrict them.”
Some malls even have a comprehensive ‘e-commerce policy’ that includes clauses like not using stores for warehousing online sales, maintaining price parity for products in the stores with online and barring brands from advertising online portals from the storefronts.
“I am not sure if price parity clause will work,” said Abhishek Bansal of Pacific Mall in West Delhi that is introducing omni-channel revenue clause in new agreements. “Even if you write (in the agreement) that there is no way to control it.”
These are various measures malls are undertaking to defend their turfs from the e-commerce onslaught, retailers say. Brands are frowning. “There are certain malls that are okay with omnichannel as they are getting revenue from it,” said the head of a global brand that has stores in all the top malls. “Then there are certain malls that see us as a competition and they are restricting us from delivering from our stores.”
Also, malls are asking for a share in revenue on any sales emanating from the digital kiosk that retailer put in the outlets even if the real sales is happening online and the store is not even involved in the delivery. “Sales from such digital kiosks from our mall should be counted as sales from the mall and they should share revenue with us,” said a senior executive at a top mall that is incorporating such clauses.
Rajneesh Mahajan, CEO at Inorbit Malls in Mumbai, said some brands have approached the mall management seeking permission for undertaking omnichannel and given their models on how to share revenues.