Shopper's Stop Limited - Securities and Exchange Board of India

Internationally benchmarked shopping environment
We believe our focus on providing our customer a globally benchmarked shopping environment with the
best in class service has been instrumental in our success. We engage international designers such as
Kingsmen Projects Pte Ltd (Singapore) and JHP Design Limited (UK) to design our stores, sourcing the
fixtures in domestic as well as international markets. We periodically provide our managers international
department store exposure through IGDS to be able to capture and implement best practices in our
operations.
This has helped us create a special niche in the customers’ mind, and enhance our brand equity. It is
because of this service and ambience that we offer, that we have been able to create a differentiation in
the mind of the customer versus our competitors where similar products and brands are available.
Strong understanding of the real estate business
We benefit from our promoters association with the real estate business and their relationships with
developers, which has helped us acquire preferred properties at competitive rates.
We enjoy Anchor Tenant status in most of the malls that we are presently located in due to our high
brand awareness and trust, ability to draw a large number of customers and occupy a significant space in
the mall. As Anchor Tenants, we occupy a prime location in the malls on terms we believe favourable to
us as compared to the other occupants.
Large base of loyal customers
We had 12.21 mn customer entries in our stores in the year ended March 31, 2004. We believe that the
emotional connect that we have been able to create with our customers through our service offering and
special promotions has helped us convert many of them into loyal customers.
We had 307,331 members of our loyalty programme as on June 30, 2004. First Citizens contributed to
about half of our Retail Sales in FY 2004.
Changing demographics in India
India is benefiting from a young population. A young population with increasing disposable income and a
propensity to spend has led to a higher current consumption spend vs. savings, which has been a direct
booster for the retailing industry.
Also, the Indian consumer is now better exposed to international trends with growing overseas travel and
media proliferation, which has led to a higher demand for aspirational or lifestyle products and services.
This has, along with our focus on offering our customers an international shopping experience,
contributed to our success.
Availability of quality real estate
Pro-active steps taken by the Government permitting use of land for commercial development has
contributed to increased availability of retail space in the country, while a decline in interest rates has
enhanced the economics of property developments and its leasing out. These changes will help us in
obtaining the requisite sites at appropriate costs.
Our Growth Strategy
We believe that the department store format offers significant opportunities in the country with the
changing consumer aspirations and drive for a better lifestyle. We believe that a younger population with
higher disposable income would drive customer aspirations for lifestyle products.
We are thus focused on the Indian markets in the department store format. At the same time, we
consistently evaluate other opportunities and may look at alternative delivery formats or product
categories or even within our existing offerings should we find the opportunity compelling or to strengthen
our existing format.
Our growth strategy is based on:
1. Increasing our penetration in existing cities and expanding our reach across the country
2. Furthering Shoppers’ Stop as an experiential retail brand through differential service and unique
national and international promotions
3. Enhancing our merchandise width by adding product categories
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