Highway retail: Motoring success

Adopted from the west, the concept of highway retailing has found many takers in the Indian retail industry. With most of the top national and international brands looking at constructing highway malls across the nation, it is evident that this new retail format is here to stay.

The present highways have lost the dullness of the past and are full of life, having provisions for entertainment, shopping, fun and game, hygienic bed and breakfast and international quality diners. The Indian highways have now been converted into 6 to 8 lanes, small make-shift shops perched along these highways have now been replaced by modern shopping malls, dhabas have been converted into restaurants serving Indian and continental cuisines, also providing local entertainment with multiplexes, amusement parks and drive-in cinemas. Indian highways are no more tiresome but provide for a joyful experience.

Private sector enterprises had been barred from participating in fuel retail in 1976 by the Indian government. However, with changing trends, the government introduced new policies in 2002, which allowed the entry of the private sector, fuelling a rush of international openings, as both the private and public sector geared up to harness the benefits of selling to the nation’s growing middle class.

Growing highway retail network

Besides leading cities, the highways running through the states are of special interest to investors, given the spending power of investors, especially non-resident Indians (NRIs).

This new retail concept provides for an opportunity to get a head start in capturing a fast emerging market segment with the promise of more brand visibility, reach and recall.

A number of multiplexes, hotels and shopping mall projects have been approved by the Government along highways - particularly the National Highway No.1 between Delhi and Amritsar, NH-2 between Delhi-Kolkata, NH-8 Delhi-Jaipur, Mumbai-Pune as well as other highways linking leading cities. The Indian highways comprise around 2 per cent of the road network, but they carry nearly 40 per cent of the total traffic.

Highways passing through Gurgaon, Kundli, Faridabad, Panipat, Ambala, Rajpura, Ludhiana, Jalandhar, Amritsar, Jaipur, Agra, Meerut, Dehradun, Mumbai, Pune, Gandhinagar, Surat, Raipur and Kochi have become hot spot for malls. Big developers such as TDI, Ansals, Omaxe, Parsvnath, Stadia, etc. have recognized the potential of highway malls and launched development projects here. Brands like Blackberry, Adidas, McDonald’s, Reebok, Provogue, Adlabs, Movie Time, PVR and Reliance Fresh are increasing their footprint in highway retail. Another compelling reason for the popularity of highway retail is high rentals within the city markets.

Ansals has announced Ansal Highway Plaza’s along several Highway locations in North India. One such mall located on Ludhiana-Jalandhar Highway caters to a catchment of over 25 lakh resident consumers, in addition to the floating population of the highway. The Melange Mall on the Delhi-Dehradun highway, near Meerut, housing popular brands, is doing brisk business because of footfall of over 25,000 everyday from Meerut residents and highway travellers. Discount Malls on Highways are popular Retail Hunts as these malls offer 50-60 per cent discount round the year on the brands they house. Projects on these lines have been announced by the Stadia Group along the highways and will be about 10-15 km away from the city.

Providing a one-km long shopping experience on each floor, Ambi Mall on NH-8 Gurgaon houses the choicest Indian and international brands. Eldeco Station I and City Centre Malls located on NH-2 (Delhi-Faridabad) attract additional shoppers—highway travellers, daily commuters of Delhi and Faridabad, high spending Agra-Mathura-Brindavan bound tourists and affluent families of the neighbouring towns.

City Mall 36, at the outskirts of Raipur on Howrah-Mumbai highway has over 154 national and international brands, as is also the case with Magneto Mall on NH-6 in Raipur. Lulu International Shopping Mall spread across a 20 lakh sq.ft area on Kochi-Edapally highway will be the biggest highway mall after its completion next year. The developers have signed 300 national and international jewellery, electronics, lifestyle, home-furnishing, furniture, accessories, bookshops and footwear brands. The mall would have 18 food courts, seven multiplexes and a 300-room five star hotel. The Oberoi Mall on NH-47, near Kochi too has an interesting brand mix.

Retail Mix in Highway Retail

Traditionally, Indian Highways were dotted with local restaurants or inns popularly known as ‘dhabas’. They served popular local cuisine and also served as a truck stop. Today, highway malls is a new retail norm where food, beverage, hospitality and entertainment form the most important tenants in the mall, followed by fashion brands. Factory outlets of fashion brands are undoubtedly a big hit with commuters and much patronized by LIG & MIG strata of population who want brand affiliation at competitive prices. For long distance commuters, highway shopping malls promise sumptuous food and fun-filled experiences. Large areas are exclusively devoted to food courts, with elaborately designed and tastefully laid out interiors. Playing hosts here are renowned brands ranging from fast food giants and renowned Indian and international cuisine chains to beverage kings and dessert gurus. The whole experience is carefully planned to appeal to the tastes and preferences of the entire family.

Highway retail also comprises top-of-the-line men’s wear, women’s wear and kids’ wear labels, leading music & electronic stores, sports brands, accessories, memorabilia and much, much more. Special promotions and pick-and drive offers promise to be the added attractions. Spaces have been earmarked for ATMs of various leading banks, to be open round the clock. For retail brands, it is an opportunity to capture a sizeable chunk of the market, with no competition for miles around.

Barista has tied-up with IOCL to launch coffee for travelers on national highways. `Barista coffee on the go' bars will offer lower priced coffee with limited menu of convenience foods. The first of these is coming up at Karnal on the Delhi-Chandigarh highway in July and the company plans to roll out at least 15-20 of these on major national highways, along the Mumbai-Pune region and the Bengaluru-Chennai, Bengaluru-Mysore stretches, to begin with.  Café Coffee Day has 19 outlets on national highways across the country. These cafes are performing very well with the development of highways and the resultant rise in the inter-city commute. “We are receiving a good number of customers everyday on highways,” said Ms Bidisha Nagraj, Marketing-Head, Café Coffee Day.

Traditional Retail Gets Facelift

With the conversion of narrow highways into 6 and 8-lanes since 1995, the traditional food shacks (dhabas) and shops which were selling local products, impulse purchase goods or seemingly dubious international labels in their make-shift shops have either converted into air-conditioned well-lit stores and restaurants providing all facilities to commuters or have gone into franchise arrangements with known brands.

Between Delhi and Amritsar on NH-1, many old-fashioned all-night eateries, have revamped themselves into restaurant-cum-shopping centers to offer more than just foot room to travelers. People who are travel-weary want to do more than just get out of their vehicles, have food and go back and these new retail stores are offering more options through a variety of eateries, shops and even amusement games for children these days.

Haveli, a private enterprise offering five-star comforts has changed the way people look at roadside dhaba culture on NH-1 Ludhiana-Amritsar. The Haveli, a busy highway eatery on the outskirts of Jalandhar city attracts around 300 people an hour or say 7000 round the clock.  On Jaipur-Agra Highway (NH-11) near Sikandra, on both sides of the highway (approximately 6 kms) there is an open air market of about 500 shops selling artifacts and wares like jali pillars, idols, fountains, birds and animals in stone made out of sand stone.

Headed For Bright Future

The vintage location at highways is a most promising aspect. Located on Delhi-Gurgaon, Ludhiana-Jalandhar, Amritsar-Pathankot, Mumbai-Pune, Delhi-Dehradun highways, the shopping malls, multiplexes and restaurants cater to commuters.  Over 21 million resident consumers of Punjab highways do their hassle-free shopping while traveling on these highways in the wide radius of its surrounding urban areas.

TDI is coming up with three malls-cum-multiplexes along the main GT Karnal Road, NH-1. It plans to develop 12 highways malls and multiplexes connecting Delhi to other cities.

The concept of providing a one-stop shop to the consumer is the rage, with both consumers and enterprises benefiting from highway retail business. Without a doubt, the trend of highway malls will maintain its upward graph for quite a long time in the coming years.