Multi-brand stores battle with flawed retail margins

Multi-brand stores, once a favourite of Mumbai's fashion forward, are fencing with flawed retail margins and the lure of standalone outposts to stay relevant

Last week, Arti Kirloskar walked into Churchgate's concept store, Bungalow Eight (B8), looking to find something interesting from its multi-brand curation. She was there because she heard the 16-year-old clothing, accessories and décor pit stop was shuttering.

Trustee of the Kirloskar Foundation and an artist, she had travelled from Pune to see if she'd find a black jacket to wear to the upcoming Art Basel Hong Kong. It's not surprising that a customer would seek out B8 located under the bleachers of Wankhede Stadium, for a specific something, or walk in without agenda but go away with a curiously unusual discovery. The top-notch curation, often considered the mainstay of a successful multi-brand store, is what regulars will miss.

Loulou Van Damme, who is helping Sanjay Garg set up his flagship New Delhi store, says while the main job of a retail shop is to sell, it can no longer simply put things on a hanger or treat it like a space with four walls. Pic/Bungalow Eight

In an earlier interview to mid-day, B8's founder-curator Maithili Ahluwalia, had said, her big challenge was to provide a value add to the customer, and protect it. "Retail, for me, has never been about mere distribution. It is about offering what is unique. But today, with the pressure of social media, we are sharing our work in real time and helping create copycats and clones. It is a tough balancing act."

Tina Tahiliani-Parikh, whom many would call veteran champion of the retail game, agrees that multi-brand retail is tough business. "We are still here because we love what we do, and we leverage our experience. India is changing, along with the context and the customer." Tahiliani-Parikh is executive director of Ensemble, the country's first multi-brand store. Founded by her brother, the couturier Tarun Tahiliani and his wife Sailaja with late designer Rohit Khosla in 1987, it arrived at a time when a new India was birthing thanks to the exposure that the Asian Games and the arrival of cable television brought with it.

Gaurav Gupta

They are not alone
Interestingly, the specialty multi-brand brick-and-mortar format is negotiating many of the same challenges faced elsewhere in the world, including consumer engagement. Consumers care about designer tags but less and less about where they bought them. Competition from direct-to-customer e-retail and the death of brand loyalty post market fragmentation, are adding to the challenges.

While stories of the retail apocalypse are now commonplace, this month, all eyes were on the grand new Galeries Lafayette Champs-Elysées launch in Paris - a contradiction of sorts to the doomsday theory. "Retail is far from dead, but the value proposition of a store must be clear. Today, the retailer's job is curatorial. It is to draw out something unique from a designer, whether through specific edits, adaptation, exclusivity or capsule collections," Ahluwalia believes.

Once retailing at multi-brand store Ensemble, Gaurav Gupta now sells out of this 2,200 sq ft standalone at Kala Ghoda, where he offers the customers a selection of 200-plus stock under one roof

Belgian designer Loulou Van Damme came to India in 1999 to retire. She was 55. At 72 today, she continues to work, among other things, as visual merchandiser. She started at B8, and is currently helping textiles maven Sanjay Garg build his flagship store at Delhi's Lodhi Colony Market expected to launch end of March. "There's a huge improvement, in a way that retailers are now understanding the role of visual merchandising in order to attract the customer. The main job of a retail shop is to sell, but you can no longer put things on a hanger or treat it like a space with four walls. Customers are spoiled, and if they take the time to come into your space, they're looking to connect and discover something," she says.

Tina Tahiliani-Parikh is the executive director of Ensemble, India's first multi-brand store set up by her brother, the couturier Tarun Tahiliani and his wife Sailaja with late Rohit Khosla in 1987

The standalone attraction
Designers, who once were part of a multi-label store curation, are now considering the standalone store option, increasingly choosing to sell exclusively. This, say insiders, is disrupting the fundamental approach to consuming fashion merch, specifically the how and where of buying. Gaurav Gupta, who sells out of a standalone store at Kala Ghoda, and dresses Bollywood's famous, says, "Fashion, in general, has moved from the fashion week framework to being celeb, Instagram and standalone-store oriented." In his opinion, a multi-brand store could get restricting for the customer. "At our standalone, for instance, we are offering her a stock of 200-plus. It's a concentrated way of delivering an inclusive, personal brand experience."

Azmina Rahimtoola

Gupta began his career selling out of Ensemble before he acquired this 2,200 square feet space in November 2014. "The experience of retailing at Ensemble for 10 years gave me the confidence that I should go solo," he adds. Gaurav Gupta, the brand, has moved out of Ensemble altogether, on account of geographical proximity (Ensemble is a five-minute walk away at Lion Gate), but the label's lighter, non-bespoke pieces are available at Aza's Bandra outpost.

Focused stores such as Gupta's are popping up across the city's retail landscape, because, to endure you have to stand out. The last decade has seen Kala Ghoda's rapid transformation, from deadbeat to fashion's darling destination. It was in 2014 when Sabyasachi Mukherjee relocated his pièce de résistance repository at Ador House. Ritu Kumar arrived in the vicinity in 2015, followed quickly by Rahul Mishra, Abu Jani & Sandeep Khosla's ASAL, Varun Bahl, Shantanu & Nikhil and Kunal Rawal. Anamika Khanna with sons Viraj and Vishesh is finalising a property at Kala Ghoda for her first standalone experience for the Mumbai consumer.

Like in Gupta's case, Ensemble also features collections by Anamika Khanna. In fact, the brand occupies a designated space inside the store for a shop-within-a-shop experience. "A lot would depend on us [whether we continue the shop-in-shop arrangement with Anamika Khanna]," says Tahiliani-Parikh. And while she may not consider standalone direct competition, she thinks viable retail margins are the roadblock. "It's [viable retail margin] the real issue, but who is going to change it? The cottage-industry mentality of markup or markdown needs to be done away with. We need to transition into making this [retail] much more about the business of fashion," says Ahluwalia.

Direct dial the customer
Eight-year-old Bandra store Atosa's Azmina Rahimtoola says, dealing with smaller designers who have no ambition of launching a standalone, poses a challenge of its own. With retailers overhauling their business model to embrace ready-to-wear and semi-formals, and engaging with young labels, entrepreneurs like her have the social media hurdle to cross. "The new lot of designers we stock, might not have their own stores, but they are spread thin with exhibitions and trunk shows. Social media has allowed clients a direct door to the designer, reducing the role of middleman [the store]," she says, adding how giant retailers are choosing to compete with smaller boutiques to get exclusive consignment deals with second-in-command designers.

The balance of power has shifted, and the designer now has the upper hand, believes Ahluwalia while Gupta makes a case for the customer who is "inundated with choices". Those who can adapt will survive, clichéd as it may be.

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