Big brands head for the North-East

Bangalore, May 13 (AGENCIES): Long shunned by retailers, the hilly terrains of the North-East are now sending 'welcome' signals to big brand names and mega malls. While the brand-conscious north-easterner has always been high on the f.q. (fashion quotient), it's only now that retailers seem to have found the right fit for them, contributed largely by improved political stability and better air and road connectivity. In the last 18 months, franchising activity for national brands has increased in the region.
Four malls being thrown open in the Siliguri and Guwahati region in the last eight months have opened the doors of opportunities for retailers and brands. Mr Gaurav Marya, President, Franchise India Holdings, an advisory services firm for brands and franchisees, says that one of the reasons for increased retail activity is the shift back home of locals from Bangalore, Delhi and Kolkota. "Earlier, lack of information about the region scared retailers. With these people, who are familiar with their land, taking up franchises, the region is not so mysterious to the brands anymore."
As far as fashion index goes, the North East is quite ahead of a lot of other States and is also familiar with most international names, thanks to a huge influx of "fakes" from neighbouring countries. "But the point is consumers are adopting Western culture. The region has a large English-speaking population and English music and movies are part of people's culture. Spending and purchasing power is also high here," says Mr Rishi Vasudev, Vice-President and Business Head, Arrow.
The company plans to make inroads into the region starting with Guwahati and Shillong, as it sees a "mature" consumer base here.
While Guwahati was the farthest a retailer would venture earlier, now other "pockets of consumer affluence" such as Aizawl, Shillong, Imphal, Kohima, Siliguri and Dimapur are emerging, according to Mr Arvind K Singhal, Chairman, Technopak Advisors.
Retailers expect at least 10 towns in the region to be retail-ready in 2-4 years.
Retail major Future Group, which has a presence in Guwahati, Darjeeling and Siliguri with both Big Bazaar and Pantaloons outlets, plans to set up stores in Shillong and Asansol in the next 12 months. Mr Rajan Malhotra, Head, Big Bazaar, says that in terms of sales, Siliguri is as good as Nagpur or Nasik and Guwahati is comparable to Pune.
Retailers also see the market as a viable opportunity as rentals are low and returns are attractive. V. Govindraj, Vice-President – Integrated Retail Services, Titan Industries, says, "Stores do good business here and are viable given the low rentals compared to other States. But being a relatively small region, it may not be comparable to Delhi or Mumbai."
Titan Industries has a fairly well distributed retail presence in the region with watch showrooms in Guwahati, Dimapur, Nagaland, Tripura and Agartala and Tanishq jewellery stores in Guwahati and Agartala.
While lifestyle, apparel, education and entertainment retailing have their billing counters fairly busy here, pure food retailing chains such as More and Spencer's are biding time to drop their anchors here. Analysts attribute this to operational difficulties and lack of retail clusters, which once overcome would make supply chain investments viable and hence the retail landscape richer.