New stores are proving that the catchphrase ‘all under one roof’ is now the door to success in the retail world.
--BY MUNA SUNUWAR
The increasing number of shopping stores in the urban parts of Nepal indicates that the way people shop is changing. Footfalls in large and mini stores already indicate that urban-based Nepalis are attracted to buying their necessities at various types of stores. Easy access to multiple choices including global brands in one place is an attractive proposition for consumers everywhere. Traders have also realised that brand consciousness is gradually growing in Nepal, although, at present, affordability for higher brands is quite low even among average middle class Nepalis.
Realising this growing trend of shopping at departmental stores and the fascination for brands, three international brands Ximiso, Miniso and Mumuso are trying to establish themselves in the urban markets of Nepal with their franchised stores. Ximiso, Miniso and Mumuso are lifestyle and designer brands that, in general, offer a range of quality consumer products that are reasonably priced for consumers. The term ‘lifestyle’ and ‘designer’ brand broadly implies marketing terminologies for daily use consumer products segmented under one brand and reasonably priced.
These franchise stores see the potential for business in Nepal primarily because its consumption pattern is becoming dynamic. “The country is still in the developing phase. Affordability among Nepalis consumers is still low but their brand attraction is growing. It is why stores as ours have stepped forward to enable average Nepalis to consume products that are branded, affordable and good quality,” says Gajendra Shah, managing director at Mumuso, a Chinese-Korean brand in Nepal of Sanyee Company Pvt. Ltd.
“We aim to supplement the changing lifestyle of urban-based Nepalis who prefer quality products at an affordable price”, says Shambhu Tandukar, operation manager at Miniso, a Japan-based designer brand launched by Yoso International Pvt. Ltd. in Nepal. Tandukar believes that shopping stores like Miniso that offers a recognised brand of products at a low price will become value-added shopping stops for many Nepalis.
One of the reasons why these brands are getting popular is due to their low price range. While products at Ximiso start from Rs 118, the starting price at Miniso and Mumuso is Rs 129. All three stores claim that despite low prices, their products are excellent in terms of quality. They also agree that not all their products are low-priced.
Generally, items for daily use are sold in these stores. Products on display fall under such categories like creative homeware, health and beauty, clothing, fashion accessories, office supplies, gifts, seasonal products and digital accessories. Miniso claims that its popularity has grown among a large section of consumers due to the quality and price, which was initially limited to middle class consumers. Similarly, Shah feels that the stores cater to the need of consumers of all age groups. “We have products used by students to business professionals,” claims Shah. “There are toys for children, stationeries for students, cosmetics for young people, diaries for businesspersons and other useful products for senior citizens,” he further adds. They however agree that young consumers are the major customers of their stores.
The technique of displaying products used in such stores is also unique. These stores not only use traditional ways to display products, but also have stepped up in terms of visual merchandising. “We receive a 3D instruction from the company on how to display the items in the store,” says Gopal Koirala, operator of the Ximiso outlets and the authorised dealer for Korean-based Ximiso products in Nepal in collaboration with Lovely House Variety Shopping Centre. Visual merchandising in Nepal has been popular with Nepali shoppers as Tandukar claims that about 50 to 60 percent of Miniso’s customers are walking clients who randomly enter the store.
Ximiso operator Koirala claims that 99 percent of customers who enter the store buy Ximiso’s products. “Only one percent leave empty-handed. We are confident that if one doesn’t buy anything in their first visit they will return later to actually shop,” he adds.
Miniso operates in a number of Southeast Asian countries where they are enjoying success. It has helped them understand the Asian consumers’ mindset. “Miniso saw the potential to establish itself as an everyday brand in Nepal because people were paying the same amount or more for similar products as ours. The difference is that Miniso is made with quality,” observes Tandukar. Tandukar informed that Miniso updates its products every other week.
“Even our shopping ambience and customer service is ata different level,” claims Tandukar. The stores also look distinctly different compared to typical Nepali department stores. The stores have emphasised lighting, staff placement and staff attitude towards customers, store cleanliness and environment to enhance customer experience.
Similarly, they have employed young people at their stores. “Half of our employees are young students who are provided with a choice to work as either a part-timer or a full-timer,” says Tara Lama, store manager at Miniso. “We want to contribute in breaking the vicious circle of ‘no experience, no job’ by providing opportunities to the young workforce,” she adds.
Another concept behind such department stores is saving time by making a wide range of consumer products systematically available at a single place. Miniso has 11 categories of items and more than 8,500 items in its stores while Ximiso has eight categories and more than 4,000 items most of which are daily use products. Sushmita Chaudhary, a regular shopper at Miniso and Ximiso, finds the size of such stores perfect. “They are not huge where you could get lost and they are not that small either. You can easily find whatever items you are searching for,” she explains.
Store location plays a vital role in attracting customer footfalls, even from those who don’t intend to shop. Most of the lifestyle brand stores are located in the areas which are accessible to walking clients. The stores have also managed to attract tourists who come to Nepal. Stores located near tourist hubs often encounter foreign customers. “China Town, a super market located at Bagdurbar, Kathmandu is a shopping stop for Indian tourists. Most of them also visit Ximiso as it is situated right beside China Town,” mentions Koirala, adding, “They buy products in bulk which is good for us as we don’t set huge margins in our products.”
The growth rate of such stores has been going up as the number of people visiting such stores has amplified. Tandukar says that Miniso is currently working on a future expansion strategy and brand building. Miniso and Ximiso have a strong presence in social media which has helped them build their respective brands. “People did not know the brand before but now they do,” observes Koirala. With the soaring popularity, the brands now plan to expand their outlets across Nepal. Miniso plans to open 20 outlets throughout Nepal by the end of 2018. Likewise, Ximiso and Mumuso plan to open outlets in a number of Nepal’s major cities. “We want to reach out to customers across Nepal,” says Shah. He explains, “Customers are inquiring about the possibility of Mumuso outlets around their area. We are trying to fulfill their demand as soon as possible.”