Raymond exits home retail business

The ‘to be or not to be’ situation has finally ended for Be: Home, the home retail foray of Raymond Ltd.

After operating the multi-brand stores for two years, the textile and apparel major has decided to pull out the home retail format from the market.

Industry sources told DNA Money that all the Be: Home stores including one located at High Street Phoenix (Parel, Mumbai) and the up-market Juhu area in North Mumbai have already shut shop.

While there were rumours that Raymond management is planning to re-launch the home retail business, a company source said discontinuing the retail format was part of a strategic business decision.

“Home products is not a very easy format to work on and there is very bleak possibility of reinventing the retail chain. Besides, the management wants to focus more on the apparel and accessories business which is already seeing good traction,” said the source.

In an email response to DNA Money, Raymond spokesperson said, “With its evolving business model to suit market dynamics, the company has always been revisiting its product offerings to ensure sustained customer value. In line with our ongoing and continuous strategic evaluation of our brand portfolio to serve customers better, we withdrew the retail brand from the market. This was part of a brand rationalisation and consolidation exercise to enhance corporate performance.”

Launched in May 2008, Raymond positioned Be: Home as a speciality multi-brand home retail chain. The product offered included a range of elegant, soft home furnishings and accessories sourced from across the globe from reputed labels.

The store offered an exhaustive range of bed and bath linen, home and dining accessories, home wear, kitchenware, home decor, etc.

The company, at the time of launch, had plans to operate six stores by the end of 2008 besides setting up a countrywide distribution network for bed and bath categories.

However, it is learnt that only four stores (two in Mumbai and two other locations) have been operational at the time of discontinuing the retail format.

It is also not very clear as how much investment was made by Raymond on the format and the business registered by the stores.

As for the initiatives with its apparel and accessories business, the company launched a few new retail formats — Neckties & More and Shirts & More — last year. The formats have generated good response from the market and the management is going full throttle with expanding them across the country.

In fiscal 2010, the company’s branded apparels business witnessed sales of Rs 556 crore and Ebitda of Rs 40 crore.

However, quarterly Ebitda margins were impacted due to one-time rationalisation costs, despite increase in sales, the company told the stock exchange.

The company operates one of the largest speciality retail network in India in the textile and apparel space with 637 stores covering 1.35 million square feet of space.

The company also has 39 stores in Middle East and Saarc region. In fiscal 2010, it added 89 stores and its like-to-like store sales growth for company-owned stores stood at 5%.