Companies

Funskool keen to enter tier-II cities

Abhishek Law Kolkata | Updated on January 20, 2018 Published on March 27, 2016

BL28_18_FUNSKOOL

Plans to take number of standalone stores to 25 by next year





Chennai-based toy-maker Funskool is looking to expand its retail footprint in the country with own stores, particularly in tier-II cities.

While the company at present has 13 stores (including one for Lego), the plan is to take the number of standalone stores to 25 by March 2017. Stores are mostly franchisee-owned.

According to R Jeswant, Senior Vice-President, Sales and Marketing, Funskool, expansion will mostly be in tier-II cities, and in places with “dearth of toy stores”, even if that means some tier-I cities.

Set up in 1987, Funskool is promoted by the MRF group.

“Compared to the global market which has grown by a minimal one-two per cent annually, there is huge scope of growth here in India. We expect the market to grow at around 10-12 per cent thereby giving us a chance to expand,” he told BusinessLine during an interview.

The Indian toy market is pegged at ₹2,500 crore with Funskool, Mattel and Simba being some of the major players. Multi-brand retailers include the likes of Hamleys and Shoppers Stop.

Jeswant does not mention investment figures. But said Funskool is expecting a turnover of ₹200 crore by the end of this fiscal against ₹160 crore it reported in the year-ago-period.

Larger display

Nearly, 10 per cent of its revenues are expected from online sales.

Incidentally, Funskool took nearly three decades to come up with its first standalone retail store in 2014. Jeswant says opening toy stores has never been its focus.

“Manufacturing was our core strength and we still intend to stay that way,” he pointed out, adding that the reason to set up standalone stores was the “dearth of spaces” allotted for toys across multi-brand formats.

Toys are mostly manufactured from its own facilities at Tamil Nadu and Goa or imported.

Own stores will not just give the company a larger (display) space for licensed offerings and private labels/home brands. The home brands mostly help take on imported toys mainly from other countries.

It holds licenses for 20-odd global toy brands, which includes popular labels such as Lego and Disney.

Before the first Funskool store came up in March 2014, sources said, the company had experimented with a Lego store in Chennai. Success of it led to Funskool looking at a larger retail foray with own stores. The company is now looking to take standalone Lego stores to tier-II towns too.

Published on March 27, 2016
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