With the onset of festival season, malls gear up to celebrate the extravaganza by announcing lucrative offers, shopping deals and exciting events across the country
Dynamism, Place Making and Value Added
Services: Today, the success of a shopping mall is no longer dependent on the sales generated but also on the overall experience it offers. Also, as the market is changing quite dynamically, shopping mall developers also need to churn their tenant mix frequently in order to imbibe the new global entrants and fashions. Malls have started auditing their tenant mix regularly so as to be relevant and also provide the value added services to attract the consumers. Malls are frequently churning their tenant mix to accommodate marquee global brands such as Kate Spade, Muji, H&M, Massimo Dutti, Gap, Springfield, Women Secret, Xiaomi-Mi Home etc. The fast fashion brands along with the F&B are now preferred over the traditional department stores for allocating prime spaces in shopping malls.
Increasing Importance of F&B and
Entertainment: F&B and Entertainment are the forerunners of the changing retail landscape and will play a crucial role in future proofing retail spaces.
Mall Developers are increasingly realising the importance of incorporating F&B into their premises to drive foot traffic. The amount of space dedicated to F&B category has increased from 5%-8% a few years back to 11%-18% now. The diversity of F&B offer has also expanded in last couple of years. Dedicated F&B hubs like Cyber Hub in Gurugram, Sangam Courtyard and Epicuria in Delhi are also gaining grounds in today’s retail real estate scenario.
If conceptualised optimally and integrated well in the shopping mall, F&B and Entertainment has the ability to drive shopper traffic, increase dwell time, consumer spend and enhance overall sales growth.
Internationally there are some key formats emerging which are likely to revolutionize the way F&B is seen by landlord. In India also the new formats would get popular as we move along the evolution curve.
The growing trends of increasing importance of F&B and its impact on retail spaces are summarised below. In order to incorporate the game changing F&B concepts, the shopping mall developers have to consider the food services leases and tenants differently from the traditional retailer categories.
The share of shopping mall units dedicated to foodservice is going to be higher in upcoming malls than in older malls, and it is expected to increase significantly in coming years.
The significance and type of F&B space in a shopping mall varies prominently by market and region, and is driven by macro factors such as market maturity, the position on the “development curve” and cultural nuances.
The growth and popularity of street food, upscale fast-casual and more diverse casual dining has triggered a marked “casualization” of F&B.
F&B operators which offer healthy and organic food are gaining popularity.
Regional and local F&B operators are gaining fame and expanding to other markets.
QSRs are reinventing themselves to sustain in the growing competitive landscape and are stepping up to provide superlative experience to the consumers.
Shopping malls are incorporating dynamism through use of pop-up-spaces and newer F&B concepts with live kitchen and performances. F&B operators are increasingly adopting technology to offer better services and increase operational efficiencies. Despite huge opportunity, the future for F&B needs careful consideration as evolution and growth comes with challenges and risks for food operators as well as mall developers.
The F&B offer needs to integrated and well complimented in the shopping mall otherwise it would lead to reduction in dwell time and unfitting overall offer for the consumers.
Sophisticated approach is required to segment the F&B operators on part of the mall developers. Each format of F&B has distinct trading periods, dwell time and trade area characteristics which needs to be zoned and managed differently.
Food halls can be a great way to freshen the F&B mix within larger, destination centers, often as a replacement for food courts. They provide the opportunity to address all restaurant categories, across all price points. now looking at experimenting more with a mixed-use format, rather than standalone retail formats, allowing for quality retail on the lower floors and commercial spaces on the upper floors. As there has been a captive consumer base present in the business districts, the retailer are also making inroad into these complexes. The most common retail formats in ORCs are the F&B segments and banking & financial services.
Iconic and Heritage Properties: As the quality mall space has been limited in India, retailers have been creative and responsive to seek spaces in heritage properties and recycled places like old mills and refurbished places. With a bit of creative thinking, the retailers are opening stores in iconic locations thus recycling them for creating cult and unique retail spaces.