Reebok India to open 100 ‘fit-hub’ stores by early 2014
Putting behind the 211 million euro hit due to alleged fraud at its arm Reebok India, Adidas group is now focusing on growing the brand with plans to open 100 'fit-hub' stores by early 2014 that will account for a major portion of Reebok's such new concept outlets worldwide.
This year alone, Reebok India will open 50 'fit-hub' stores in India which will be more than half of the 80 such outlets that the sportswear brand has at present globally, mostly in US, Australia, Korea and Russia.
'What happened in the past is behind us. We are now growth-focused and we will start with our new retail format of 'fit hub' stores in India,' Adidas Group India Managing Director Eric Haskell said.
The Reebok fit-hub stores offer fitness and training products besides advice, guidance and information on community based fitness events.
'This year 50 fit hub stores will be opened. The plan is to open 100 such stores by first quarter of 2014,' Haskell said, adding out of the 100 stores, 50 will be new and the remaining half will be renovated ones.Most of the fit-hub stores would come up in metro cities but few new stores would also be located in tier-II cities, he added.
The company plans to convert all the existing 490 Reebok stores in India to fit-hub stores in next couple of years. 'It should not take longer than two to three years,' Haskell said.Stressing on the significance of the Indian market, he said: 'By opening 100 fit hub stores in India, we are making pretty substantial statement and it also shows about our commitment to the market here. Our focus is now on business. We remain committed about Reebok brand in India.'When asked if the government's FDI policy in retail would encourage the company to go on its own in India, Haskell said Reebok India will continue with franchisee model in the near future.
'It is something we would consider..we would look at doing own retail (setting own stores) but it is not my priority. Right now we are very happy with the franchisee business,' Haskell added.
In March this year, Adidas group had announced that due to the irregularities at Reebok India it had restated its financial statements which 'led to a reduction of net income attributable to shareholders of euro 58 million for 2011. In addition, shareholders' equity of the opening balance sheet for 2011 is negatively impacted by euro 153 million.'
In May 2012, Adidas had alleged Rs 870 crore fraud at Reebok India by the company's former managing director Shubhinder Singh Prem and former chief operating officer Vishnu Bhagat. The matter is currently under investigation.'We are cooperating with investigations. We get questions from investigating authorities from time to time,' Haskell said.
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