Trent adopts franchisee model

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Mumbai, May 22

Real estate bottlenecks have led the Rs 637-crore Trent Ltd to explore the franchisee model as it expands its Westside stores to tier 2 and tier 3 cities.

Having appointed its first franchisee in Mysore last year, the retailer is now poised to add 25 to 30 Westside stores in the next five years as it expands to smaller cities such as Allahabad, Patna, Guwahati, and Puducherry.

At a press conference, Ms Neeti Chopra, Head-Marketing, Trent, said, "We want to get over the property challenge and franchisees would help us in scaling up the business in the smaller cities. We expect each franchise to generate revenues between Rs 6 to Rs 10 crore for each store with an initial investment of Rs 1.5-2 crore."

Keeping to codes

With a revenue-sharing arrangement, Trent is currently in the process of appointing franchises who can "adhere to the Tata code of conduct."

"In fact Trent is the first retailer to adopt the franchise route considering other apparel oriented retailers such as Shoppers Stop and Lifestyle are yet to do it. Trent has the advantage of having its private labels whereby it can command greater revenues and profits by having a franchise partner unlike the other retailers," says an analyst.

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