Emami - Foraying Into Retail Through Landmark

Emami Buys Landmark And Renames It Starmark

The Kolkata-based Emami Group strengthened its retail segment presence by buying out Chennai-based Landmark's stake in the Landmark Bookstore in Kolkata. Emami earlier held 50 per cent stake in the joint venture. The store has, however, been renamed Starmark, as the Landmark trademark is currently owned by Trent. Emami has plans of rolling out upto 10 stores in the eastern region over the next 18 months, along with express stores, maintaining the product line available at the Starmark store at present.

Christened Emami Retail Private Limited for the time being, the retail wing of Emami Group does not plan to increase the product line or include food or agro products in the basket. It plans to cater to the books and leisure products market as it does at present. "We have three store formats -- the large stores that are upto 20,000 squarefeet in area and sell the entire product line of books, stationery, gifts, toys and music. The big format stores, upto 10,000 square feet in area, have gifts and stationeries merged into one section. And then we have the express stores varying between 1,000 to 3,000 square feet in area and having a boutique feel about it with soft lighting, chairs and wooden furnishings," explained Gautam Jatia, chief executive officer, Starmark Store Limited. Jatia informed that that investment in setting up 10 large and big format stores in the various state capitals and major cities of the east would cost the company an estimated Rs 50 crore and above. This would include lease payment and inventory cost to set up the stores.

With each Starmark store bringing in an additional business of Rs 5 crore, the company hopes to clock a business of Rs 25 crore by March 2008 from Rs 10 crore currently. Analysts said the book retailing segment will become competitive as players like Reliance, Pantaloon (Depot) Crossword Oxford and Odyssey are expanding their network across the country. Books and music retailing constitutes around 7% of the Rs 40,000 crore retail sector today. According to estimates, the books segment is growing at 15% and music at 7% annually.

The company has already identified a 20,000 square feet space at the upcoming South City Mall in Kolkata and has also booked space at the City Centre mall in Salt Lake for setting up an express store. "We want to have a large format store in the residential area of Salt Lake, but haven't identified space yet. However, we have submitted our letter of intent for setting up a store in a mall being developed by the Diamond Group on VIP road," Jatia informed. The Emami Group will retain suppliers who have been supplying products to the Landmark Store in Kolkata so far. The roll-out plan for the rest of the country will follow once the eastern part of the country has Starmark stores in place, said Mohan Goenka of the Emami Group.