SS has seven private labels in its basket offering. Stop Vittrorio, Fratini, Mario, Zignoti, I Jeans haute Curry, Kashish and life. In women’s wear, 40-45% of the contribution comes from the private label. Each private label caters to a different target audience.
1) Stop the first private label from SS, is present across product categories and the proposition it offers to the customer is value for money.
2) Vittorio Fratini and Mario Zignoti are premiums Formal and Casual wear Men’s Brands.
3) Haute Curry is a women’s Fusion Brand.
4) I Jeans is a Men’s Jeans brand.
5) Kashish is a premium ethnic wear brand for men and women. It offers Kurta pyjamas in menswear and formal salwaar kameez in women’s wear.
6) Life is a fashion brand in men’s and women’s wear targeted at the young customer.
While brands re seen as the traffic drivers in the store, it is the private labels that generate the margins. Sourcing at a better cost has always been a focus of the merchandise team for the labels
Evaluation of performance
Each merchandise category is evaluated in terms of targets and the returns that it has achieved on footage labor and inventory i.e.
1) GMROI – Gross Margin Return on Investment
2) GMROF – Gross Margin Return on Footage.
3) GMROL – Gross Margin Return to Labor
The returns on the category are compared with the benchmarks set for that category and this helps further decision making. Depending on the evaluation a decision is taken to either increases space, increase service intensity or to increase merchandise. This exercise is done once in six months, to the end of each season, so that the sales and promotions for the period are covered and the results are not biased.
IT – the back bone of growth
Considerable effort and energy has gone into developing the IT systems in Shopper’s Stop. Initially, when the first store opened, a five member team identified the information needs of all the roles in the organization across departments and hierarchical levels. A Fox Pro based systems was developed to support these requirements. However, the information was largely people focused and there was no consolidation
After 1995 a number of new entities entered the retail market place. SS had also increased its presence from one store to three stores and the management felt the need for implementing an integrated enterprise wide software solution. After studying the market at the end of 1997, JDA was identified as being the most appropriate integrated packaged software solution. After getting VSAT connectivity the company went live on JDA, in March 1999. In the following two years 2001 & 2002 the company showed losses on its balance sheet and many considered the IT system to be the cause of failure.
The leadership tasked a 12 member team to review the way in which the JDA solution had been implemented and to identify changes required. System changes were implemented as part of an organizational re-structuring program. Today IT helps integrate various functions like Warehousing Supply chain management. Buying & Merchandising Finance and HR. Various software like Oracle for Finance and Accounting JDA, and Arthur Planning for buying and merchandising and HRMS for HR are used today.
The organization has also moved on from VSAT connectivity to a dedicated leased line, so that the service office provides 24 x 7 supports. Achieving people efficiencies was sought, and this to a great extent has been achieved as from a team of forty people handling 3 stores toady there was 170 people handling 13 stores.
SS has close to 400 vendors supplying merchandise. Of these 110 suppliers are integrated with the system in operation. While warehouse logistics are outsourced integration of the suppliers has helped reduce cycle time. Going ahead the IT team is now probing the option of providing mobile cashiering to the stores gold card members and is looking to avenues in e-commerce.