Reliance Retail has given an official statement regarding the temporary closure of several Centro stores as part of a strategic revamp aimed at repositioning the department chain. This is being done in order to promote Reliance’s in-house brands and a shop-in-shop model, Economic Times has confirmed the statement. This move comes after Reliance Retail introduced Future Group’s Central stores as Centro in September 2022.
As part of the revamping process, Reliance Retail has already closed three Centro outlets and is closing 20 stores. Brands with inventory in these stores have been asked to retrieve their goods and fixtures. A letter that was sent to all Centro locations which incurred that the stores have to be shut down and a plan to initiate renovations will come in place . The letter instructed partners to remove their merchandise, promotional materials, and other items from the outlets.
The new stores will only prioritize on selling Reliance brands & labels. More focus will be on brands like Azorte and Yousta, along with international labels such as Gap and Superdry, which Reliance has taken over in India over the years. It remains unclear if the revamped stores will continue to feature local and international brands that were part of the original Centro lineup.
Centro, has 450 local and global brands as well, aiming to compete with stores like Lifestyle and Shoppers Stop. Despite a post-pandemic surge in consumer spending, retail sales expansion for the chain grew by only 4% last year, indicating a slowdown in the sector. Reliance has a strong retail holding in the market.
In a report, Reliance Retail reported a 3.5% drop in revenue for the quarter ending in September. This marks a diminishing margin, excluding the impact of pandemic-related store closures. The reason for decrease was weak demand in the fashion and lifestyle segments, coupled with a strategic focus on improving margins in its wholesale business.
