Chennai: Textile major Arvind Mills Limited has decided to implement Oracle' s enterprise resource planning (ERP) software to manage its growing chain of retail outlets. The project cost is estimated at around Rs10 crore.
Arvind Mills has two retail store formats, Mega Mart Outlet Centres (large discount stores), and the smaller Mega Mart stores. For the short term, Arvind Mills is looking to open eight large stores in cities such as Pune, Hyderabad, Bangalore and Chennai, while it plans to expand its smaller stores to tier II cities.
With each store requiring an investment of around Rs4 crore, the total outlay of Rs400 crore would be funded from internal accruals. As per Sanjay Lalbhai, managing director of Arvind Mills, last year retail stores contributed Rs100 crore to the top line of the company, and a 6 per cent profit. He said the Mega Mart Outlet Centre has been positioned as a discount store, with the tag line 'Sale on. 365 days.'
According to J Suresh, CEO, Arvind Brands & Retail, which is the retail arm of Arvind Mills, the company plans to have 30 large discount stores and 200 Mega Marts across 100 cities, and plans to achieve revenues of Rs2,000 crore by 2012. Presently, the company has 75 outlets in 25 cities.
Unlike the smaller Mega Mart stores that sell in-house brands, the large stores stock other brands as well. K E Venkatachalapathy, business head, Mega Mart says that in order to provide value to other brand owners, the company has tied-up with a minimum number of brands while offering sizeable shelf space of around 200 to 250 sq ft.