Business

Mukesh and Isha Ambani Take Major Step, Announce Temporary Shutdown of Reliance Retail’s Centro Stores for Revamp

To reorganize its department chain, Reliance Retail has temporarily closed several Centro outlets. Reliance’s in-house brands and shop-in-shop model are the main focuses of the strategy change, according to The Economic Times. Reliance Retail rebranded Future Gathering’s Focal outlets as Centro in September 2022, which was trailed by this turn of events.

Mukesh Ambani’s Strategic Move

Reliance Retail has already closed three Centro locations as part of its makeover, and by the end of the month, it intends to eliminate an additional twenty. Brands that have stock in these stores have been told to remove their fixtures and merchandise, ET reports. According to Reliance’s message to brand partners, all Centro stores will temporarily close for renovations. Partners are being instructed to remove fixtures, goods, and promotional items.

Shift to In-House Brands

Reliance’s brands, such as Azorte and Yousta, as well as international companies that Reliance has worked with recently, like Gap and Superdry, are anticipated to be given priority in the renovated Centro locations. It’s unclear if the local and foreign brands that were once offered by Centro would still be available in the renovated locations.

Centro’s Market Position

The department store behemoths Lifestyle International and Shoppers Stop compete with Centro, which offers about 450 domestic and foreign brands. Centro’s retail growth increased by just 4% last year, despite a surge in consumer spending following the pandemic, indicating a slower rate of industry expansion. Still, Reliance Retail is a major force in the Indian retail market.

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Revenue Decline for Reliance Retail

In its most recent quarterly report, Reliance Retail revealed a 3.5% reduction in revenue for the September quarter, which was the company’s first revenue decline unrelated to the pandemic. Weaker demand in the fashion and lifestyle sectors, together with an emphasis on increasing margins in its wholesale division, were blamed for the decline.