Tanhisq Jewellery now contributes 75% of the Topline for Titan Industries Ltd. Despite the pan-India presence and market leadership, Tanishq as a premium jewellery brand has been unable to occupy a dominant position in Tier-I cities. Thus transition to large format stores are a means to improve visibility and reach in key gold consuming regions.
From an average store size of 2,000 sq ft, the company has clearly embarked in rolling out larger format stores of ~20,000 sq ft over the next few years in Tier-I cities. TIL has 3 large format stores – Delhi (7,500 sq ft), Chennai (21,000 sq ft) and the recently launched Andheri, Mumbai store (20,500 sq ft) [See Picture Below]
How Large Format Stores Help Titan & Tanishq?
Large format stores will aid Titan to achieve: (1) better inventory turn compared to smaller format due to wider design assortments; (2) improve visibility & reach of the Tanishq brand; and (3) increase market share in key cities, especially for wedding purchases. In addition, GoldPlus stores – an initiative for semi-urban and rural Indian consumers will be expanded by 2-3 stores p.a. from current base of 29 stores.
Eyewear business is expected to break-even in 2 years. The current focus is on increasing scale. Mgt intends to add 100+ stores in FY12 alone on a base of 125 stores.
The management is working on new collections for working women. This will be casual jewellery with low ticket sizes for impulse purchases. While this is a small but fast growing market, we believe this initiative will drive more footfalls and improve conversions. The company has also launched new high-end collection Taj to keep the consumers involved with Tanishq brand and to drive margin improvement.