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Shopping malls with their classy ambience seem to have captured the imagination of shopping-crazy Indoreans, as these are one-stop shops where they can also indulge their love for food. But, do the old storeowners and little neighbourhood shops really have anything to worry about? Manoj Ahuja and Shubha Jain try to find out

india Updated: Oct 17, 2006 14:20 IST

Shopping malls with their classy ambience seem to have captured the imagination of shopping-crazy Indoreans, as these are one-stop shops where they can also indulge their love for food. But, do the old storeowners and little neighbourhood shops really have anything to worry about? Manoj Ahuja and
Shubha Jain try to find out

Malls rely on atmosphere, other stores on personal ties

MALLS, APART from the shopping experience, have redefined the concept of family outing in Indore. With accent on quality ambience and entertainment and value add-ons like food courts and car parks, shopping has now become more of a leisure activity. But not everybody is cheering. The old and established stores are steadily losing customers, and when more malls come up (at least three are in the pipeline), they may well struggle to stay afloat.

Data collected from sources of the Commercial Tax Department reveal that sales of Globus have fallen by 40 per cent and that of Agrawal Stores by 33 per cent in the April-August period when compared to corresponding period last year.
Store managers, however, are downplaying the impact of malls with more or less the same response: People go to malls to enjoy the ambience and not to shop.

Says head of Globus Stores, Indore, Sanjay Yadav, “Shoppers like to visit new malls, but after an initial visit or two, they go back to the stores they’ve been shopping at for years. In our case also the footfalls did go down initially, but picked up after two months. The basic fact is that only five per cent of people actually shop at the malls, while our conversion rate (actual sales to footfalls) is over 50 per cent.” Average footfalls, he says, are roughly 1,000 on weekdays and 1,500 on weekends.

Pakiza director Mansoor Husseni also maintains that they have not lost any customers to the malls. “Selling garments requires skill that everyone does not have. Moreover, malls cannot provide the kind of personalised service that we do. I can say with conviction that our customers will not enjoy shopping anywhere else,” he said.

Not everybody is trying to put up a brave front. With hypermarkets like Big Bazaar wooing customers with innovative schemes and wider choices, kirana merchants and small-time traders also seem to be feeling the pinch.

Says Siyaganj Kirana Vyapari Sangh president Ramesh Khandelwal, “The business of small retailers has already been affected to certain extent, and when more malls come up the wholesalers are also going to be hit.”

Painting a gloomy picture, he said that since chains like Big Bazaar procure directly from the producers, the middlemen involved in the trade would be among the first casualties when malls mushroom all over Indore. “I think the business of small retailers would reduce by about 5-10 per cent every year and most of them would end up working in these malls.”

Agrawal Stores director Girish Agrawal, however, claims that footfalls at his store have actually gone up in the past few months. “Our relations with customers go way back, and malls don’t give the kind of service that we do. People go to malls to enjoy, but it would be interesting to find out how many of them actually end up buying.”

The conversion rate at malls is a matter of speculation and varies from mall to mall. Storeowners are clearly trying to imply that huge footfalls do not necessarily translate into incremental sales.

Are the shoppers spending lot of time and not much money at the malls? Says Treasure Island Chief Operation Officer Colonel Sunil Sharma, “If that were the case, most of the tenants would have closed shop and left by now.” Treasure Island, which opened for public in January this year, still manages to pull in huge crowds. “On an average, 70,000 people visit the mall daily on weekdays and the figure shoots up to 1.20 lakh on weekends,” Col Sharma said.

The shopping experience and combo offers at Big Bazaar in Treasure Island have been received well by Indoreans. Working people and women having small children find it easier to shop for grocery, vegetables, stationery, clothes, cosmetics and sweets etc at one go from Big Bazaar.

Deepti Shrivastav, a housewife, has recently begun shopping from Big Bazaar. Deepti told Hindustan Times that previously she shopped for groceries and other household items from Pakiza (which has a supermarket at its AB Road showroom). The shift was because of the wide choice and unique offers available at Big Bazaar.

Another woman (name withheld) said that the rates at Apoorti, Pakiza and Big Bazaar are almost same. The only difference is that Apoorti offers one or two brands while Big Bazaar has almost all the brands in different ranges.

An employee of Apoorti Super Bazaar told Hindustan Times that the crowds on weekends had reduced considerably. “Earlier we remained open for an extended period of time on weekends as the response was good, but that is no longer the case.”

Even as Treasure Island is drawing huge crowds, footfalls are not all that impressive at Indore’s other mall - Mangal City. The mall is located on the outskirts of the City at Vijay Nagar Square and is half the size of Treasure Island. But unlike Treasure Island, which is designed on ground circular grid pattern wherein one can get a good view of almost the whole mall from the inside, Mangal City is designed more like a shopping complex.

Rajeev Jain, proprietor of Koutons, one of the shops in Mangal City, attributes the low turnout to absence of food court and smaller number of outlets. “We expect more crowds once fast food chains like McDonalds open up.” Mangal City also has a separate entrance for multiplex, one of the reasons why it looks less crowded. The mall management has no idea about the average daily footfalls. Assistant mall manager Roman D’Souza said that it was very difficult to guesstimate average footfalls, as there was no common entrance.

The impact of mall culture on departmental stores and super bazaars is clearly visible in the locations close to the malls, but traditional shopping districts like Cloth Market and Rajwada remain by and large unaffected, mainly because they cater to different needs of consumers.

‘Space enough for malls, old stores’
ECONOMIST JAYANTILAL Bhandari says that stores like Globus and Pakiza will have to spend more on marketing and advertisement to take the malls head on. “The City is spreading at a fast pace and there is definitely space for malls as well as old stores. They just need to change their marketing strategy.” Bhandari said small retailers have no cause for worry because most of them are situated in the neighbourhood and people will continue to visit them for their daily needs. “These shop owners are on friendly terms with their customers and also take back goods and provide home delivery.” Bhandari, however, said that even small retailers would have to work on their salesmanship.

‘Saturation point may not be too far’
HOW MANY malls can Indore have before they become commercially unviable? Says Treasure Island promoter Manish Kalani, “At present, the retail activity in shopping malls is less than one per cent of the total organised retail shopping market in Indore. Yes, with a number of malls coming up in Indore and consumer spending having a finite limit we will reach a point of saturation at some point in time, but it is very difficult to say when.”

Wearable clothes
RADHIKA MATHUR, a regular customer at Pantaloons during recent months, said, “The daily wear and college dress collection here is fresh and very much wearable. Here one gets designs that are simple yet unique.” Radhika remarked that most of the unique designs at Globus were ultra modern and could not be worn in the market place or in colleges.

Different experience
MOHINI SONI, a student of Maharaja Ranjit Singh College, believes that it is the customer service at the fashion outlets in Treasure Island that adds to the quality. In Mohini’s words the complete experience is different and makes shopping enjoyable.

Package deal
ANOTHER TEENAGER, Vinni Tuteja (who earlier shopped from Westside), is of the opinion that shopping in malls is like a ‘holiday package’. Shopping could be combined with a snack or movie break and there are many more options at your disposal.

First Published: Oct 17, 2006 14:20 IST