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E-commerce expands to countryside

The emerging scenario indicating that the increasing e-commerce penetration into India’s semi-rural hinterland has spawned unique expansion opportunities for a completely different online retail industry from earlier generation ¬ brick-and-mortar fashion stores. Strategists at India’s organized fashion chains are combing the end-user address lists of Web commerce companies to analyze whether it might be worth their while to open large-format stores in, say, Siliguri, Amroha, Moga, or Gaya. “As a brand, we reached 22,000 PIN codes today, purely thanks to e-commerce and they have helped us reach our products to the oddest of places,“ said Manish Mandhana from Mandhana Retail, which markets Salman Khan’s Being Human label. Mandhana says Being Human plans to open about 100 stores in the next two-three years and 60% of them will come in tier 2-3 cities.Similarly, US Polo plans to open 60 outlets this year and half of those would come up in smaller towns.Ethnic wear brand Biba has about 100 outlets in smaller cities and plans to add 40 more. Similar are the plans at Lifestyle, Puma, and Tommy Hilfiger. Compa nies such as Arvind Lifestyle Brands have started to assess the sales of their brands on various e-commerce platforms besides looking at the usual parameters of demography and prosperity of a particular region before opening a store. Many e-commerce companies, including Amazon, Flipkart, or Myntra, say more than 50% of their sales are now generated in smaller towns. “We also crosscheck our sales from online partners such as Myntra for proposed locations,“ said Alok Dubey, CEO Lifestyle Brands at Arvind Lifestyle Brands. Retailers say there is a latent demand in smaller consumer centres due to the Internet penetration and increased awareness. Furthermore, the supply of better retailing infrastructure is now allowing brands to add outlets in smaller towns.

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