Crossroad's Retailing Lessons

Details

Themes: Retailing
Period : 1999-2000
Organization : Crossroads, Piramal Enterprises
Pub Date : 2001
Countries : India
Industry : Consumer Goods & Services

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Case Code : BSTR005
Case Length : 6 Pages
Price: Rs. 200;

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At The Crossroads Contd...

The tenants started regarding themselves as stand-alone entities. "No one has time to listen to our demands," remarked Kishore Biyani, managing director, Pantaloons. These tenants also started feeling that the Piramals were more interested in promoting the in-house store, Pyramids, than the mall as a whole.

The recreation arcade of the mall was also facing problems. The novelty value of Jammin' seemed to be over. Footfalls fell to a low of 2000-4000 people a day, from the initial 15,000 a day.

Piramals planned to close down the entertainment center and use the space for selling saris and footwear. Piramals faced the dual threat of loss of tenants, and falling traffic.

Many of the tenant leases would lapse in 2002. Also, with many new malls in the pipeline in Mumbai, the situation at Crossroads was unlikely to get any better. As the group planned to widen its shopping basket to establish itself as a destination store.

It planned to initiate a multi-storied extension with 20,000 sq.ft. of retail space and a car park. Crossroads entered into a strategic alliance with Larsen and Toubro to establish an entertainment complex and shopping mall at Nariman Point.

The mall would be called Crossroads E Zone and would house a Cineplex, a health club, besides the food courts and a shopping plaza. Crossroads was also planning to establish similar stores in the Central suburbs, Western suburbs and New Bombay. It also planned to set up establishments in Bangalore, Delhi, Calcutta and Chennai.

These new outlets would offer a mix of products that were not available at Crossroads, like computers, footwear, and saris. Said Jaydev Mody, managing director, Crossroads, "While Crossroads at Tardeo (Mumbai) caters to the middle to premium end of the market, we are looking at a similar set-up for the mass to middle end of the market.

In such malls, within the same categories, we will look at stocking a shirt in a range of Rs. 100-150 instead of a premium brand in the shirts category. Such a mall will be set up in a place like suburban Mumbai."

Is this the right strategy?