The Telegraph
Since 1st March, 1999
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Sports shoe major takes to its heels
- Retail biggie forced by low footfall and high rentals to shut shop

Going, going…. gone. Another chapter has been added to the city’s retail shutdown saga with a high-profile store in the heart of south Calcutta downing shutters.

The Reebok Classics outlet housed in the upmarket Astral on Gurusaday Road (opposite Mainland China) has taken to its heels to flee the double blow of low footfall and high rentals. The Nike store next door could shut shop next, feel market watchers.

Reebok officials were tightlipped, but it is learnt the franchisee was paying around Rs 220 per sq ft per month as rental for the store, which didn’t make business sense.

“Given the market situation now, with most brands bleeding, anything more than Rs 100-120 per sq ft in that locality would hurt,” says Vijay Dugar of CS Trade Link, a franchisee of Reebok in Calcutta.

Rentals peaking and business sagging had earlier scalped the Adidas flagship store on Camac Street, the giant Odyssey bookstore on Prince Anwar Shah Road and the Egaro department store in Bhowanipore. A few stores in malls are also closed, pending rental negotiations, as the din for the revenue-sharing model instead of fixed monthly rentals grows louder.

Reebok, which had 80 stores in east India at the beginning of the year and was looking at 150 by this year-end, was bullish on Calcutta, till the Gurusaday glitch. “The failure to sustain the Classics store in a high-end locality will rob them of valuable brand exposure,” observes Kamal Jain, who runs Adidas and Benetton outlets in town.

The developers of Astral admit that rentals have reached unrealistic levels, but explain why. “We had sold the retail block to an investor, who in turn has resold to a third party. The resultant mark-up has led to this high rent,” says Harsh Patodia of the Heritage Group, joint developers of the condo-retail combo.

Levi’s, which operates a two-level flagship store in the Astral property, is also bleeding because of poor footfalls, but has decided to hang in there for now. “Yes, footfall has been an issue, but we aren’t shutting shop yet. In fact, we might introduce something new on the first floor soon,” reveals K.K. Roy, who heads Levi’s marketing in the East.

Saurabh Dugar of the PS Group, joint developers of the Gurusaday Road shop stop, admits that the product-mix could need some tweaking to make the property work. “We are in talks with the holders of the premises to help them find the right formula. We can look at some F&B with maybe designer brands.”

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