Reliance Retail Shuts Centro Stores to Focus on In-House Brands

Reliance Retail has temporarily shut down several of its Centro department stores as part of a broader strategy to refocus on in-house brands and transition to a shop-in-shop model. According to the sources, the initiative is aimed at aligning more closely with Reliance's own private labels and expanding its partnerships with global brands. Several stores are set to close by the end of November.

In 2022, Reliance Retail took over leases for the former Central stores of Future Group, rebranding them as Centro. This move followed Future Group's decision to surrender several of its leased properties. However, as part of its ongoing revamp, Reliance has informed brand partners to clear their inventory and store fixtures from the affected locations, signaling a temporary operational pause for all Centro stores.

Instructions for Brand Partners

A letter issued by Reliance Retail to its brand partners has confirmed that all Centro locations will halt operations as part of the revamping process. The letter also instructed brands to remove merchandise, promotional materials, and other items from these stores to prepare for renovations.

While specifics regarding the inclusion of local and international brands in the redesigned stores remain unclear, it is reported that Reliance Retail plans to introduce a new shop-in-shop model. This revamped model will prominently feature the company’s brands, including Azorte and Yousta, alongside international labels such as Gap and Superdry, which Reliance has recently acquired or partnered with.

Centro’s Competitive Landscape

Centro currently hosts around 450 local and global brands, competing with major department store chains like Dubai-based Lifestyle International and Shoppers Stop, owned by the Raheja Group. Despite slowing retail sales growth -4 percent last year following a post-COVID-19 surge—Reliance Retail continues to hold a dominant position in the Indian retail market.

In its latest earnings report, Reliance Retail reported a 3.5 percent decline in revenue for the quarter ending in September. This drop was attributed to weak demand in the fashion and lifestyle segments, alongside a strategic focus on improving margins in its wholesale business. It marked the first revenue decline for the company outside of pandemic-related closures.

However, Chief Financial Officer Dinesh Taluja emphasized that, despite macroeconomic challenges, Reliance Retail remains focused on long-term growth through significant investments in technology and design capabilities.

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