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Last Updated : Sep 29, 2020 12:55 PM IST | Source: Moneycontrol.com

Woodland Shoes maker Aero Club may cut store count, plans to expand online business

Company will negotiate rent reductions for remaining stores and, while continuing to partner multiple e-commerce platforms, will promote its own site for online orders


COVID-19 has prompted most businesses to redesign their strategies, particularly after the lockdown, which had a major impact on most sectors.

Aero Club, which sells footwear, apparel and accessories under the Woodland brand, is also being forced to rationalise its store count/expenses. However, it will expand its online business at the same time.

“Rationalising is the need of the hour and we too have reviewed our network and are in the process of consolidation,” Harkirat Singh, Managing Director, Aero Club, told Moneycontrol in an interaction.

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The company currently has an exclusive retail chain of over 600 stores in a CO-CO (company owned, company operated) model.

“There are stores that needed re-location or re-sizing and we have happily reviewed each PoS and taken corrective action (as required) in the business interest,” Singh added, without revealing details on the number of stores that will be shut or resized.

Not only that, the company is also renegotiating rentals for its existing stores. At the same time, to compensate, Aero Club is expanding its online business.

Online push

Considering the current scenario, Singh said having an omni-channel presence is a blessing as it has enabled the footwear maker to accept more orders online by integrating its stock.

“Our e-commerce partners, too, are assuring us of good demand. It is safe to say sales are dominated by online platforms,” Singh said, adding that while offline has started picking up, it is far from normal yet.

Singh said that due to the lockdown customers were not stepping out to shop and were turning to online platforms. This trend helped the company register 40-50 percent growth in online sales.

According to Singh, post-lockdown, Aero Club has witnessed momentum picking up for both apparel and footwear.

“Although the flagship product of the brand is footwear and is thus still the core face of the brand, other collections such as apparel and accessories have also got wide acceptance,” Singh said.

The Woodland brand is available in exclusive and multi-brand stores. It is also available on online platforms such as Amazon, Flipkart and Myntra.

The brand site

The company plans to expand its online business despite its presence across prominent e-commerce platforms.

“E-commerce sites like Amazon, Flipkart, Myntra are our key partners. However, a brand site is an exclusive listing of our exhaustive offerings and represents the brand ethos, look and feel and offerings in the desired perspective and thus, needs to be a bible.

By expanding the online business, the company intends to reach out to the masses with its range, over and above the key styles offered by e-commerce partners.

Singh emphasised that Woodland is much more than the select range of footwear offered by partner sites and was expanding its online business across platforms, publicising it through social media handles and digital spends.

Being a youth brand, Woodlands, said Singh, has always done well in the digital space. Digital sales contribute 10–15 percent of group revenues.

Footwear accounts for over 50 percent of group revenues and thus is still in the highest demand as part of brand offerings, he added.

Demand revival, footfalls

Aero Club has started seeing demand reviving for both apparel and footwear. Singh feels the festive season will help it achieve at least 40 percent of its FY21 revenue target.

The company closed FY20 with almost Rs 1,300 crore in revenue as against Rs 1,250 crore for FY19. Almost 60 percent of the turnover came from footwear and the rest from apparel and accessories.

Singh is confident that the company’s businesses will regain momentum in the next two-three months and expects a growth rate of 10–15 percent in FY21.

Speaking about footfalls in stores, Singh said that while there has been an increase in footfalls since malls opened, it is comparatively still quite low vis-à-vis the pre-COVID era.

He feels that while customers are looking forward to the festive season and offers, gaining customer confidence by adhering to the ‘new-normal’ norms will be key to attracting customers to stores.

“Assuring utmost safety and ensuring all necessary precautions are being taken by the brand will eventually result in increased footfalls. All this combined with the overall festive sentiment should help pull up all businesses,” Singh said.

Rental negotiation

According to Singh, rent is the core operational expense in the retail business and needs the utmost attention, especially in restarting operations post-COVID.

As soon as the lockdown was lifted, Aero Club was keen to re-initiate business and rents were one of the key points of discussion.

Singh said the company has renegotiated rentals and cost sharing agreements with its partners.
First Published on Sep 24, 2020 08:40 pm

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