Croma store-count to hit 100, again

Tata Group’s Infiniti Retail, which owns the Croma brand of stores, will be again reaching the 100 store-count. The consumer durables retailer had lost about six stores after it exited Punjab in 2015.

Ritesh Ghosal, Chief Marketing Officer, Croma, told BusinessLine: “We will have our 100th store again this year at Bhandup’s (Mumbai) Magnet mall. After we exited Punjab in 2015 and shut some of the unprofitable stores in places such as Amritsar, Jalandhar and Ludhiana, the store count had dropped below 100.”

The firm plans to open 10 new stores in its existing markets in West, South and North India.

“The new stores will be in the existing 16 cities we are present in, with a capex of ₹1.5 crore for each store. Today, we have achieved break-even at a store level and are EBITDA positive at a company level,” he added. The new stores will measure 8,000-10,000 sq ft.

The firm’s smaller format stores, under Croma Zip, which currently has about eight stores at airports, might also find new locations for future outlets.

“We are still looking for the right catchment for Croma Zip. We decided to invest in the Zip stores instead of advertising at airports. Our airport revenues are currently less than 5 per cent, but we are looking at a proliferation strategy for Croma Zip.”

Even e-commerce at present contributes less than 5 per cent to Croma’s total revenues — most of it is generated through its own site, Croma.com, although it has a presence across marketplaces such as Amazon and TataCliQ. Croma was listed in marketplaces like Snapdeal, but has been slowly consolidating its presence on its own site. “Almost 60 per cent of the e-commerce sales happen through Croma.com; consumers prefer to visit our stores and then buy online through our site,” Ghosal added.

Exclusive distribution tie-ups with players such as Hitachi (for smart TVs), Hamilton (for kitchen appliances) and UAE-based Super General (for home appliances) have also been forged. “Mobilephones continue to be the largest-selling category at our stores. But this summer, air-conditioners have also registered 25 per cent growth over the last season.”

With the GST, the retail company is planning to have fewer distribution centres, leading to consolidation of inventory. “With the GST, the inventory cost will come down for us as there will be consolidation of stocks with fewer distribution centres. Besides, the service tax on rentals should also bring down costs,” observed Ghosal.

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