Home Solutions Retail, part of the Future Group, is scaling up operations of its premium consumer durable retail format, e-Zone. The company will be launching Mega e-Zone, a larger variant of the existing chain of consumer durable stores.
The company operates e-Zone and Electronics Bazaar, a value retail format through its Big Bazaar hypermarkets.
Manoj Kumar, CEO, e-Zone and Electronics Bazaar, said,"The Mega e-Zone, measuring 25,000 sq ft and above in area, is being developed as a destination store for electronics purchase. The store will offer seamless space for brands to retail their own merchandise."
Mega e-Zones will allow companies to display wider range of products and comprise eight home theatre zones.
"The company has locked real estate spaces in eight top cities with the first store slated to open in Bangalore." Currently, the company operates more than 25 e-Zone outlets with an average store size of 10,000 sq ft.
The move assumes significance as other organised players, such as Tata's Croma and Reliance Retail's Reliance Digital, have made their foray in durable retailing with bigger formats ( 20,000 sq ft and above).
Infiniti Retail, which operates Croma, had earlier said it would invest about Rs 400 crore (Rs 4 billion) to set up 100 stores by 2010. While Reliance Retail plans to open 150 Reliance Digital outlets by 2011 with an investment of Rs 5-6 crore (Rs 50-60 million) per store.
Home Solutions intends to invest Rs 500 crore (Rs 5 billion) in its consumer durable and electronics retailing business in the next two years.
The durable retail operations are expected to cross Rs 700 crore (Rs 7 billion) turnover by financial year-end. The company is also giving a thrust to private labels Koryo and Sensei as part of its expansion plans.
It has introduced new categories like washing machines, digital cameras and LCD televisions under the private labels which are expected to contribute 20-22 per cent to sales.
"The new categories are estimated to open the markets at the bottom of the pyramid and upgrade customers towards premium products. For instance, Koryo washing machines already contribute fifty per cent to total washing machine sales," added Kumar.
