Croma, owned by Infiniti Retail Limited, took the CDIT market by storm with its megastores and zip stores. Franchise India Media caught up with Ajit Joshi, CEO, Infiniti Retail Croma to know the success story of the company.

Franchise India Media (FIM): How has the journey been for Croma since the inception?

Ajit Joshi (AJ): For Croma, the three years of existence have been a great period of growth and expansion. We are now serving the Centre for Development of Information Technology (CDIT) needs of millions of consumers through 43 stores in 10 cities. We are growing in terms of size, reach and turnover. Our growth rate so far is more than 50 per cent in terms of turnover and we have aggressive plans for the coming years.

FIM: What are the various store formats of Croma?

AJ: We have two retail formats Croma Megastores and Croma Zip Stores. Croma Megastores are large format stores ranging from 15,000 -20,000 sq. ft, well-planned and designed for world class in-store experience and backed by robust after-sales service. There are stores in Mumbai whose size range between 15000 - 22000 sq.ft. The store in Bengaluru is spread over an area of 22,000 sq. ft. The size of Croma Zip varies from 2500 to 6000 sq. ft housing select range of electronics and accessories, particularly at airport terminals.

FIM: What kind of product assortments are there at these stores?

AJ: There are LCD TV, home theatre system, DVD systems and gaming consoles besides other white and brown goods. We also have the broadest range of IT products including all major brands for laptops and mobile phones. Over the last few years we have been sprucing up private label; we now have 50 products under the brand Croma. We have plans to launch more products, like washing machines and so on. In a way we are a large CDIT warehouse where every Indian family could meet its requirements.

FIM: Do you think exclusive stores of white goods & IT products are a competition to Croma?

AJ: On the contrary, the EBO’s are working in our favour. Typically a customer may first go to an exclusive store and then visit Croma before making a buying decision. At Croma, he/she would get a chance for cross comparisons of product features, better deals and at par if not higher product instruction from experienced retail-sales personnel as at EBO. For instance, last year Croma stores recorded higher sales of MAC products as compared to sales made at MAC outlets even when MAC and Croma outlets were in the same periphery.

FIM: What is next for Croma?

AJ: Well, next year is going to be challenging for us, we want to grow at the same speed as earlier. While the figures are still under audit, we are reasonably sure that our turnover for the financial year 2009-2010 will be around Rs 1020 Crore. We were actually expecting to achieve revenue of Rs 1,000 crore, which is an increase of over 50 per cent from the previous year. Fortunately, we will surpass our expectations.

FIM: What is your expansion strategy?

AJ: We will expand in some other cities; and penetrate more in Delhi, Mumbai, Bengaluru and Chennai. We also want to enter Mysore. Our strategy is to penetrate deeper in the cities we are operating in. This will aid operational efficiency and allow us to garner higher market share. In tier-II and tier-III cities there is a huge demand for branded products. We are confident that our brand Croma will do really well in these areas. Currently, we are rolling out plans to have many more Croma stores in major metros. We will be opening a zip store in Pune; first in the city. There are two zip stores in Delhi and Mumbai. We are planning to open other two at different airport terminals.

FIM: What is your strategy regarding private labels?

AJ: We are getting better at understanding and meeting the consumers’ needs and this is helping us create a market leading brand. Particularly through our private labels, we are trying to customise the product to the requirement of nuclear and working families. We first identify the needs of the customer with regards to white and brown goods and thereafter the R&D team coalesce the features, related to those needs, at product development stage making our private labels unique. Croma products are cheaper by 10-15 per cent in comparison to branded ones and so they really hit the mark with the customer.

FIM:  What changes have you witnessed in the retail industry in the past decade?

AJ: The past decade has been a watershed period in the retail industry. Shopping options and habits have never changed as rapidly as in the decade gone by. Shoppers have been exposed to modern retail formats for the first time and they accepted it with lot of enthusiasm. Malls have come up, world’s leading retailers have made an entry, new product categories have entered the market and options in the existing categories have increased multifold. The shopping environment for the consumer has improved dramatically- more so in the bigger towns. The year 2010 will establish us as a leader in the electronics retail category. We are aiming to demystify technology and help more and more customers make informed purchases.