Reliance Retail is expanding its business into the fast-growing toy sector through its brand Rowan to operate in the affordable segment with a smaller shop size.
The company was running its toy distribution business through Rowan. It has now brought this homegrown brand to the front end by opening its first EBO (exclusive brand outlet) at Gurugram in NCR in the last quarter with a store size of 1,400 sq feet.
Under this new format, Reliance Retail, the retail arm of Mukesh Ambani-led Reliance Industries, will have a range of affordable toys not only from the brand Rowan on its shelves but also from other brands, said an industry source.
Reliance Retail also has the iconic British toy retail brand Hamleys in its fold. Hamleys is the world's oldest toy retailer and was acquired by Reliance in 2019, marking the first acquisition of a global retail brand by the company.
Hamleys would continue to operate in the premium space, while brand Rowan would help Reliance Retail to tap the mid-premium and mass segment with its affordable offerings, the source said.
The unit value of toys will be much lower at Rowan stores, and the discounts offered will be higher. Hence, products will be more affordable, he added.
Moreover, unlike Hamleys, the store size of Rowan stores will be much smaller, ideally measuring between 500-1,000 sq ft, he noted.
"We also launched Rowan, which is a new format from Reliance as a toy store, which is a small format, typically around 500-1,000 sq ft in size, selling more affordable toys. So, that format also got launched during this quarter, and we'll also see it further ramp up as we go along," Reliance Retail Head of strategy and business development Gaurav Jain said.
Hamleys currently has a global footprint across 15 countries with over 200 doors and is India's largest chain of toy stores.
With both brands in its portfolio, Reliance Retail Ventures Ltd (RRVL) is one of the leading toy distributors.
Earlier in June this year, Reliance Brands Ltd (RBL), a unit of RRVL, had announced a joint venture with Italian company Plastic Legno SPA and acquired a 40 per cent stake in the latter's toy manufacturing business in India.
According to a joint report by industry body FICCI and KPMG, the Indian toy market was estimated to be around $1 billion in 2019-20 and is expected to double to $2 billion by 2024-25.