By: Ashish Bansal Alok Kumar Kaushik Arun Kumar Nitin Mishra

History
Shoppers Stop was founded in 1991 by the K. Raheja Group of companies, one of the largest players in the country in the business of real estate development and hotels. From one store occupying 2,800Sq. Ft and retailing only mens wear, it has grown to a chain of 52 stores offering Mens wear and womens wear, childrens wear, Home products, accessories, cosmetics, perfumes and jewellery. Besides the stores also offer a music corner (Planet M), a book corner (Crossword) and a Coffee Shop (CCD). It opened a Home Concept store called HOMESTOP, covering soft and hard products in home and hi-fashion & Makeup artist requirements.

History
The company has exclusive licensing arrangements with Austin Reed, UK for Mens wear and womens wear clothing for India. It is also planning to partner Mother Care of UK , in their retail venture for India, acquired crossword in year 2000. Shoppers Stop runs one of the largest loyalty programs in the country with First Citizen base of 1.5 Million members.

Legacy of Shoppers Stop

To be a global retailer in India and maintain the No.1 position in the Indian market in departmental store category Is the vision with which the foundation of Shoppers Stop was laid.
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Shoppers Stop has grown from 1 store in 1991 to more than 50 stores across India in year 2012. In a span of 22 years, it has managed to achieve what very few retailers have managed- Building a powerful retail brand. It has managed to retailing itself as a household name in the markets it chooses to operates in and is committed to retailing superior quality products and creating a complete shopping experience. Co-ordinated products offering and a superior shopping experience are the reasons that it is the only retailer from India to become a member of the Intercontinental Group of Departmental stores(IGDS), along with 29 other stores from all around the world.

Buying and Merchandising at Shoppers Stop

Merchandise Planning is a centralized function. The corporate objectives determine the turnover to be achieved. This determines the targets to be achieved by the various categories and that becomes a category benchmark. In real terms, the business is looked upon as a basket offering to the customers and the merchadiser caters to those customers. The whole process of category management is looked upon as a methodology of satisfying customers. The trading managers, the merchandiser and the buyer work together to achieve the objective of each category.

In order to understand the process of buying and merchandising in the organization, it is necessary to understand the method in which categories are defined and handled.

See figure A.1 for better understanding

Buying and Merchandising at Shoppers Stop

Budgeting is done at the sub department, chain level. Once the budgets are frozen, the off-takes are determined in terms of value and quantity. This is the starting point of the Assortment Planning Process. Thus, if womens wear has a budget of Rs. 100 crores, the departmental break-ups would first be determined. Departments in Womens wear are Indian wear, Western wear, Lingerie and Nightwear. The merchandise in each department is then classified into sub departments. For example, in womens western wear tops would be a sub department. First, the brand mix of the total number of tops required is determined. Then the fabric mix and the color mix are determined. This is the starting point of Range Planning.

THE PRIVATE LABEL

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SS has been private labels in its basket of offering. Stop, Vittorio Fratini, Mario Zignoti, I Jeans, Haute Curry, Kashish and Life. In womens wear, 40 - 45% of the contribution comes from the private label. Each private label caters to a different target audience. Stop, the first private label from SS, is present across product categories and the proposition it offers to the customer is value for money. Vittori Fratini and Mario Zignoti are premium formal and casual wear mens brands. Haute Curry is a womens fusion brand. I Jeans is a mens jeans brand.

THE PRIVATE LABEL (Cont)

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Kashish is a premium ethnic wear brand for men and women. It offers kurta pajamas in menswear and formal salwaar kameez in women wear. Life is a fashion brand in mens and women swear, targeted at the young customer. While brands are seen as the traffic drivers in the store, it is the private label that generates the margins. Sourcing at a better cost has always been a focus of the merchandise team for the labels.

IT THE BACKBONE OF GROWTH

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Shoppers Stop was awarded the best IT user of the year award by Nasscom, in the retail category in the year 2003. Considerable effort and energy has gone into developing the IT systems in Shoppers Stop. Initially, when the first store opened, a five-member team identified the information needs of all the roles in the organization across departments and hierarchical levels. A Fox Pro based system was developed to support these requirements. However, the information was largely people focused and there was no consolidation. After 1995, a number of new entities entered the retail marketplace. It had also increased its presence from one store to three stores and the management felt the need for implementing an integrated enterprise-wide software solution. At the end of 1997, JDA was identified as being the most appropriate integrated packaged software solution. After VSAT the company went live on JDA in March 1999. In year, 2000 & 2001, the company showed losses on its balance sheet and many considered the IT system to be the cause of failure.

Improvements in IT and back up plans

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The leadership tasked a 12-member team to review the way in which the JDA solution had been implemented and to identify changes required. System changes were implemented as part of an organizational restructuring programme. Today, IT helps integrate various functions like Warehousing, Supply Chain Management, Buying & Merchandising, Finance & HR. Various softwares like Oracle for Finance and Accounting, JDA and Arthur Planning for Buying and Merchandising and HRMS for HR a used today. The organization has also moved on from VSAT connectivity to a dedicated leased line, so that the service office provides 24 X 7 support. Achieving people efficiencies was sought, and this to a great extent. Has been achieved, from a team of forty people handling 3 stores, today, there are 170 people handling 13 stores.

IT improvements (Cont)


Shoppers Stop has close to 400 vendors supplying merchandise. Of these, 110 suppliers are integrated with the system in operation. While warehouse logistics are outsourced, integration of the suppliers has helped reduce cycle time. Going ahead, the IT team is now probing the option of providing mobile cashiering to the stores gold card members and is looking at avenues in e-commerce. They launched a online websites where in the consumer can buy the products online and can even earn points if they have First citizen account.

Integrating the supply chain

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Shoppers Stop has close to 400 vendors, supplying various products. Initially, the company has a distribution centre attached to each of the stores, now with an online supply. Network system, the company has opted for regional distribution centers. Regional distribution centers exist at Mumbai, New Delhi and Bangalore. The merchandising management module helps decide on the right kind of products that have to be bought for the store. It can be anything ranging from a particular brand, fit, style, material and color of trouser, for instance. The module identifies vendors, fixes the buying price and selling price and even raises purchase orders.

Integrating the supply chain (Cont)

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Before the online ERP package came into function, the distribution system was completely dependent on individuals, who were in charge of receiving, tagging and storing of the stocks, and since most of the stocks were stored in cartons, it was difficult to identity the stocks in the absence of the particular individual who had received the stocks.

Creating The Brand Experience

It has always aimed at providing a superior shopping experience to the retail customers. Keeping this is mind, it has created events and promotions which target at either increasing the business at the store or at providing a unique experience to the customer.


One of the first events to be organized by shoppers stop was DOTY- The designer of the year award. This was awarded to the young and budding designer, for Image, Design and Creativity. The Festival of India, Parikrama, was created in the year 1998.Over the years, Parikrama has been redefined as a festival which celebrates and enjoys Indian culture. Artists from different sates of India showcased there work. For this special occasion the in-house design team had created an exclusive line of ethnic wear for women under the private label STOP and KASHISH. The collection had festive colors combined with regional flavors, fused with exclusive fabrics. A unique festival which focused on both sales and experience was The Seven Wonders festivals. For this festival each store reflected the characterstics of each wonder of the world.

Re-branding of Shoppers Stop Retail

Shoppers Stop started facing tough competition in the mid 2000s, as competitors like Globus, Westside and Lifestyle, who catered to the same segment of customers, entered the market. The youth, which was the main target segment, wanted trendy products. Shoppers Stop felt that re-branding itself would be a good idea at this point.
However, before taking the step, they went through a series of workshops called Trial Room, to understand the preferences of consumers.

 They

realised that not just the logo, the entire look and feel of the brand would have to change.

The brand idea needed to connect to younger people, several strategic decisions helped them at this point:
1.

They chose a new logo as they felt that it was more classical, rich, and authoritative something Shoppers customers connect with. Black and white gives them a strong brand recall value.

2.The positioning was changed to Bridge to Luxury, which clearly helped them differentiate themselves from their competitors. 3.They also changed the tagline to Start Something New, which fit in with the changing mood of their consumers. 4.They continued with their First Citizen program, showed very satisfactory results in the initial phase.
A. B.

This program helped to retain customers and add to the perceived value of the brand. It also served as a strong brand pull creator as it created a niche for its frequent shoppers and raised the expectations of the customer in terms of expected value from the brand.

HSBC to Citibank
5. They collaborated with HSBC. They targeted niche segment who fell in the age group of 16 years to 35 years, who could afford and maintain a credit card with a global bank like HSBC.
A.

They shifted from HSBC to Citibank, the reason was because they felt that Citibank was a more international brand than any other Indian Bank.

6.The service underwent a change.

A.

They had a new dress code in black and white for the employees and training sessions for the employees to help them tackle demanding customers with varied tastes. They introduced a company anthem for the staffers penned by renowned lyricist Gulzar and sung by popular Indian playback singer Sonu Nigam. They brought out collectible shopping bags with different themes and launched the first in the series based on the theme Fashion for the Ages. They stressed on a green message, starting an environmental awareness campaign called Think Green. As part of this initiative, they planted more than 500 trees and distributed 1,500,000 seed sachets among its customers.

B.

C.

D.

7. They were the first brand to introduce the concept of Customer Care Associate, to reinforce at all levels that the customer always comes first. 8. They introduced a new concept in the retail industry by setting up trial rooms with day and night lighting options so that consumers could check how garments would look during the day and in the night.

Thus, through all these changes, Shoppers Stop emerged as a whole new brand altogether.

First Citizen Programme

At Shoppers Stop priority is given to customer convenience with customer friendly signage. First Citizen program has 1.5 million active members across India. First Citizen Program contributes nearly over 50% of Shoppers Stop sales annually.
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Membership to regular customers is provided in three stages . Classic Moments. Silver Age. Golden Glow.
The core customer for First Citizen program fall under the age group of 16 to 35 years.

 1. 2. 3.

Benefits by First Citizen program: Customers gain reward points each time they shop at Shoppers Stop stores or shoppersstop.com, Updates on various products in the store. Exclusive benefits & privileges ,Exclusive offers on purchase. Exclusive cash counters which help customers to spend more time shopping than waiting in a queue.