Growing up, the Fabindia experience was associated with memories of fine combing through tall, neatly stacked up piles of cotton kurtas. Often, its accompaniment was the guilt, for the sales executive who would have to put it back together. And, the lingering feeling if there was a better design that was left out.
A few years back, Fabindia decided to change that. In March 2017, the ethnic fashion retailer started experimenting with experience centres. Two years now, it is betting big on its large format retail stores for its next leg of growth. They want to take its number to 30 by end of this fiscal, says Ajay Kapoor, President, Retail, Fabindia.
"We want to add a new line of customers and offer them an experiential retail experience," he adds.
Experience centres are 8,000 to 12,000 square feet retail outlets (regular stores are around 3,000 square feet). In addition to garments, organics, home and personal care, they house a FabCafe, an Interior Design Studio, a Wellness Center and an Alteration Studio. Typically, each experience centre requires an investment of Rs 3,000 crore per square feet.
In spite of the large investment they require, Kapoor says they have shown significant business benefits. He shares after they converted the Home Store in the Greater Kailash area of Delhi, its sales have on average grown by 40 per cent. Overall, in their 25 experience centres to date, sales have jumped by nearly 25%.
The reason, he says, is in display and placement of inventory. "Now, most of the products are hanged making it easier for customers to find their best fit. Plus, complimenting categories are placed next to each other so sales executives can upsell and cross sell."
By March 2019, Fabindia had ten experience centres. Since its business case is established, the firm is looking at expanding it faster. In the last six months, the firm opened five more stores. "We have a strong pipeline now as the spaces have been leased and are getting prepared," says Kapoor. They will be launching one in Panchkula in Haryana in December 2019, followed by another in Bangalore in January 2020.
In 2021-2022, Fabindia plans to open 20 more experience centres in India.
Fabindia closed FY19 with sales of Rs 1,148 crore and a net profit of Rs 116 crore. It is targeting sales of Rs 1500 crore in FY21. Seventy per cent of its revenue comes from metros.
Fabindia currently has 322 stores across 114 cities in India and 14 international stores.