CHEN ONE

Mehwish Aslam, Sana Shaikh and Mahvush Aslam

 INTRODUCTION & HISTORY
TYPE OF BUSINESS
Mian Muhammad Latif laid the foundation for Chenab Group,
Chenab is a family owned business and so is Chen One. It's
Chen One's parent company in 1974. Initially Chenab Textiles
owned by Mr. Latif, who is the Chairman of the company.
exported products to many countries. It is Pakistan's leading
textile manufacturer and exporter. The ability to process linen
RETAIL FORMAT
and synthetic fibers up to a maximum width of 320 c, has
placed the company in the fore front of home linen and By Location
furnishing fabric market, as well as in the garment and high As it is the only outlet in Karachi, many customers come to
tech textile trade. the mall only because of Chen One, which means that it has
a destination location.
Chenab Group realized that their textiles' quality was
extremely good and looking at the growing trend in Pakistan's By Ownership
retail economy they started their own brand. The idea of It started as a family owned business, with Mr. Latif as its
opening an outlet was not only successful but was also a single owner, who was later on joined later by his younger
source of getting recognition in Pakistan. Another major brothers Mian Javaid Iqbal and Mian Muhammad Naeem. So,
reason for coming into Pakistani market was to cater to the by ownership it is an independent store.
local consumers, who buy international brands and seek good
quality. By Merchandise
Chen One deals with a wide product range including apparel,
COMPANY OBJECTIVE AND MISSSION full range of furnishings, crockery, and accessories. It carries
STATEMENT products for the whole family. Hence, by merchandise
category it is a family store.
"Our policy is customer satisfaction which we ensure through
proper planning, continual improvement, employees satisfaction, STORE DESIGN AND RETAIL MIX
environment friendly production, prevention of environmental
Children's Accessories
pollution, resource conservation and implementation of relevant,
a) Merchandise Type and Density
environmental, social and cultural norms/laws."
It includes clothes, shoes, bags, stuffed toys and all
COMPETITORS related accessories for children. Its product range is from
infants to teenagers.
Visitors to Park Towers make it a point to visit the three-
leveled store. Chen One was the first store of its kind and
after its success, other manufacturing companies began retail
operations, including Ideas by Gul Ahmed Textiles.

There are many competitors both inside and outside the mall.
In men's wear, its major challengers are Cotton and Cotton,
Cambridge and Hang Ten. For home fashions and
accessories, it competes against Ideas and Habitt and in the
children's section, its rivals are Zubaida's Mother Shop,
Bumble & Bumble, and Mushroom's. But Chen One has an
edge over all these because of its huge assortment in the
above areas.
Stuffed toys displayed in glass shelves

18 Retailing: Success Stories from Pakistan Chen One 19

b) Fixture Type and Density b) Fixture Type and Density
The fixtures in this category comprise six glass shelves of 4x6 size. It has four In men's area there are around 4 gray and brown wooden
pillars with black and silver built-in rods around each pillar, for hanging clothes. display stands with silver rods displaying formal pants. Most
These rods are fixed in a stooping manner for waterfall displays. of the casual pants are kept folded in white built-in niches.
For displaying shirts and kurtis, they have the same glass
As soon as one enters the kids section, there is a semi- shelves, as in kid's section, with silver rods to hang the
circular counter on the right side displaying stuffed toys clothes. Blazers are kept at a deeper end of the floor,
and school bags. The counter also has packed baby suits, including ties and other accessories. A male mannequin is
along with stuffed toys. kept with each shelf. There is a counter displaying leather
wallets, key chains, belts and small leather accessories.
In front of the entrance, there is a baby cot on display. On
the left side, glass shelves display bright and colorful clothes.
It has 4 baby mannequins displaying clothes. At one
extreme of the area there's a big open shelf for shoes. It has
a small unorganized back area as well, to keep additional
stock.

Next to the shoe shelf, there is a white wooden window

shelf containing different sizes of clothes and stuffed toys.
There's a big black stand, displaying a good range of
socks as well.
Counter display for leather accessories
c) Employee Type and Density In women's area there are two long pillars covered with
The employees at the children's floor are trained in their mirrors. It has a lot of silver built-in rods round the corners
field and are very co-operative. On this floor, the of the walls displaying female eastern and western
employee density is low as there are usually only two clothes. Pants, nightdresses, and casual tops are again
employees on duty. displayed inside glass shelves, which are open from two
sides. A lot of sales promotion has been done in the outlet,
Men and Women Wear with walls having posters of models displaying Chen One's
a) Merchandise Type and Density clothes. Two female mannequins are kept in female area,
Chen One's men's wear has greater depth than its one displaying an eastern outfit, and the other western.
women’s wear. It stocks all kinds of shirts, pants, blazers, This floor has around 4 changing rooms, two in male
jackets, kurtis, shoes, ties, leather accessories and section and the other two in female.
socks. All these items are available in many different
materials, sizes and colors. This floor also has a semicircular counter with T-shirts,
pants and shirts displayed in the counter window.
Although women's wear has good assortment but its
variety is limited as compared to men's wear. In the On the roof of the counter, apart from having glass pieces,
summer collection, the emphasis is on casual and semi- it has small hangings as well which are directing
formal clothes. It includes shalwar kameez, pants, tops, customers to different sub-sections.
skirts, and undergarments.
At one end of the counter, a range of shoes is also
displayed.

20 Retailing: Success Stories from Pakistan Chen One 21

c) Employee Type and Density entice the customers to buy them. This is mainly done to
Chen One has a policy that it trains employees in all areas, so the type of employees increase multiple purchases. There are three main pillars
in this section is also educated and trained. The employees in the men's section are with glass shelves attached to them, to display bed
well groomed and presentable. Two people handle the men's section; whereas, only covers. There are dining tables on display with crockery
one handles women's wear. displayed on it.

d) Visual Type and Factors c) Employee Type and Density

This floor has the brightest effect than the whole outlet The employees here are trained and have technical
because of huge glass walls in the ladies section. Due to knowledge about the products. The number of employees
this a lot of sunlight comes in, which makes the place look on this floor is around four but it changes depending on
wider. It also has those similar yellow lights, which are the number of customers.
found in the whole outlet to give the same image and
identity. These lights are built in the roof. d) Visual Type and Factors
This section has a lot of sunlight coming in due to the
However in men's section, the lights are dimmer, glass walls. Much of the lights are yellow coordinating with
especially in the area where formal pants are kept. the store strategy. It also has a semicircular counter, with
the same glass pieces on its roof and white lighting. This
Home Fashions floor has additional lightings of lamps, which are kept at
a) Merchandise Type and Density different places.
This section has a very wide product range, ranging from
bed sets, dinning tables, center tables, anrange, amazing Sound Type and Density: (1st, 2nd and 3rd floor)
collection of bed linen, bathroom accessories, crockery, They usually play trendy or rap music at a low bass, which
lamps, home accessories, artificial plants, special sounds appealing. This music can be heard in all the three
decorative items, candles, and flower arrangements. levels of the outlet.

Odor Type and Density: (1st, 2nd, and 3rd floor)

It has a starchy scent in the apparel section. Overall, the
outlet has a soft and soothing fragrance.

VISUAL MERCHANDISING
Home Fashion
The first floor uses coordinated method of presentation, for
instance, a dinning table has related accessories like
crockery, napkins, and mats. Lamps, bed covers and inviting
quilts compliment a bed. This increases cross merchandising.
This floor has two major types of shop displays including
A wide range of designs of bed linen available at Chen One window displays, and counter displays.
b) Fixture Type and Density
All the bed sets are arranged along the sides of the Men’s & Women’s Wear
semicircular layout of the floor. They are properly set with The apparel section mainly uses mannequins and fixtures to
all the related accessories like lamps and bed covers to display clothes. The displays in the women's wear section
focuses on the new collection. However, in men's wear there
was no emphasis on theme presentation except for the

22 Retailing: Success Stories from Pakistan Chen One 23

casual wear. Men's wear is displayed on wooden stands. The leather goods circulation space in this section, the customers are able to
such as belts, wallets, and key chains use counter displays. walk very easily though the store. Due to the unattractive
displays of western clothes in the female section, it's not
Children's Section able to attract a lot of women customers. On the contrary,
The children's section communicates the ‘kids’ there the merchandise of the men's area attracts a lot of
collection through displays using mannequins. They use customers.
counter displays for stuffed toys and baby clothes. Their new
arrival of bags is displayed very prominently behind the
counter.

STORE ATMOSPHERICS
Signage
The signage of the store including the slogan "Changing
Lifestyles" is written in black. The word "CHEN ONE" is c) Kids Section
written in red and blue. Initially, they had a logo of a penguin, The selling space is 60% including the counter and shelf
but due to their expansion in other countries and in order to displays. The circulation area is 30% while the back area
adjust into various cultures, it has been removed is 10% including the changing rooms and the office of the
branch manager.
SPACE MIX AND RETAIL SPACE
Chen One covers an area of 12,000 square feet. It has
divided its total area into three main divisions, which are
further subdivided. The outlet is leased, which is why a lot of
investment has been done on the interior.

Retail Space Management

Store Layout / Circulation Plan
a) Home Fashion
The layout of the whole outlet is common in all the three
In the Home Fashion section, 75% of the area is selling
floors. Although the merchandise is kept in an organized
space; 5% back area, and 20% circulation area. The
manner but there is no defined way. The merchandise is
customers on this level are able to walk freely but not as
grouped in clusters. Therefore, it has a free flow format.
comfortably as on the other two floors. This is because
of the small and fragile items displayed haphazardly on
Floor Space Management
the floor.
As the area of Chen One is not only one floor, so the
productivity has to be measured by keeping in mind all the
three floors. Productivity of space is measured by using
certain parameters, which are the best guide for judging the
space performance. They include sales per square foot,
margins per square foot and stock holding per square foot.
These parameters help to determine which part is generating
more sales and profits.
b) Men's & Women's Wear
The selling space of apparel section is 60%, the circular
space including the staircase is 35%, and the back area is According to the General Manager Sales, Mr. Agha Rizwan,
5% which includes the changing rooms. Due to a lot of "If space performance is measured in terms of department or

24 Retailing: Success Stories from Pakistan Chen One 25

 division, then the home fashions department is the most
productive". However, he was unable to give any figures.

Hot Spot Analysis

Home fashions mainly include furnishings, bed linen, and
accessories which makes it a hot spot. The men's wear on the
second floor is also a major hot spot.

Warm Spots
Women's wear section has comparatively lower sales and low
customer traffic as compared to men's and kid’s wear. This
makes women's apparel section a warm spot.

MERCHANDISING
a) Merchandise Hierarchy
The merchandise hierarchy is divided under the following
heads:
n Home Fashion

n Garments

Merchandise Hierarchy for Home Fashion and Garments

Detailed Hierarchy of Home Fashion and Furniture
26 Retailing: Success Stories from Pakistan Chen One 27
b) Buying Function c) Markdown
Decisions about inventory and budgets are made by Chen One's parent company. Chen One marks down products when a season comes to
Its buying function has the following elements: an end. In the beginning of a new season, old inventory is
removed from their shelves. This is done through "Open
Forward Sales Planning House" sales held twice a year. Goods are marked down
Chen One forecasts its sales in many ways. First, they to up to 50% of the Maximum Retail Price (MRP).
follow seasonal forecasting, i.e. they plan their sales for
two main seasons: summer and winter. d) Shrinkage
Considering the huge amount of merchandise Chen One
The seasonal forecasting is divided into monthly sales to carries, its almost impossible to keep an eye on every
determine what level of inventory is required. employee and every customer all the time. In order to
Forecasting is further divided into weekly sales. prevent this, it has used a variety of advanced techniques.
Considering the forcasted level of sales, their budgets They include tags, stickers and weaving (in built). These
for inventory are made. techniques help Chen One to keep shrinkage at a very low
amount, which is around 1.5% yearly.
Forward Cover
Their inventory turnover is not on the basis of forward SUPPLY CHAIN MANAGEMENT AND OTB
cover. However, as soon as any item is sold at the point of
sale, system records it and the data is sent directly to the Chen One has two kinds of supplies. The first one, customer's
head office where the merchandize is reordered and sent orders, is limited to certain merchandise and is rare. The
to the outlet within two days. second is normal routine orders. The Open to Buy (OTB)
process at Chen One is on a daily basis. The data is fed in
Stock Required and Stock On Order automatically in the Point of Sale system which is sent to the
The process of ordering merchandise is not done on the head office everyday. The inventory is replenished as soon as
basis of daily sales. That means inventory is replenished the stock level goes down. Chen One has its own supply
daily. As Chen One has an efficient internal system, which chain management. It has its own distributor and suppliers.
connects outlets to the head office, information about the The notes issued by the suppliers are signed by the
sold inventory is given to the head office, from where they warehousing department and the same note is signed by the
send the same amount on the next day. supervisor at the outlet when the stock is received. The
Goods Received Notes (GRN) and the Inter Transfer Notes
Open to Receive (ITN) are linked with one another. The goods return feature is
The stock received by the outlet is recorded in the MIS also present in the MIS. A return receipt or note is packed in
and is acknowledged by the head office. A copy is given the cartons which are sent back.
by the supplier which is signed by the receiver and sent
MARKETING STRATEGIES
to the head office.
The significance of a marketing strategy in any type of
Closing Stock business whether its manufacturing, retailing or distributing
Chen One has closing stock depending on the units/items cannot be questioned. It is equally important in retailing as
sold each day. Since inventory is replenished everyday the well.
figure depends totally on the sales.
a) Brand Image
Chen One's target market is high-income customers.
The brand is not for middle class or lower class
customers. Chen One says that if they cater to that
class by reducing the prices of their product, they would
28 Retailing: Success Stories from Pakistan Chen One 29
have to compromise on quality. bundling is also done for promotional purposes.

b) Positioning According to most of the people, Chen One's prices are

According to the General Manager Sales, Agha Rizwan, very high, and are not affordable to many. But it's officials
Chen One provides the right value for money to their believe that, "we are not catering to the market which
customers. He says this on the basis of the product, but cannot afford these prices. And even if the prices are
there are other factors as well, including the services, higher, products are worth the prices."
ambience and location. All these aspects compliment
each other in providing value to customers. Promotion
As earlier said, Chen One communicates everything what
They have kept a consistent positioning from start of it offers. Its promotions are both price led as well as
operations. It has always focused on quality and lifestyle. occasion led.
In order to make people aware about their products, they
communicate what they provide. The main attraction for a Occasion led promotions are done on seasonal basis.
Chen One customer is its wide product range. Every year, they promote their summer and winter
Loyal customers are given a lot of importance and they collections. Price led promotions include all its promotional
make sure that they retain them. For that they issue activities during sales and discounts. The major price led
loyalty cards and give other benefits. promotion is done during its open house.

c) Retail Marketing Mix People

Product The word "people" not only means the employees of the
Chen One is an outlet where customers can get almost company, it also includes the people who buy. The
each and everything for the house and for themselves. It success of a retail outlet depends a lot on the type of
has clothes, shoes, and accessories for every member of employees it has, because they are the ones directly
the house. There is no other outlet which provides all interacting with customers.
these things under one roof. Its product range and product
quality is an integral part of the marketing mix. People who serve at Chen One are educated, and well
trained in their respective area. Most of them are very
Place cooperative. They help the customers in getting the right
Chen One, being in a very busy shopping mall, has a mall product, but provide them with space as well. The
location. It benefits from this feature, as 10% of Chen One's appearance is given a lot of importance, as all of them are
sales comes from this mall location, resulting in a decrease well groomed, and presentable.
in advertising cost. Chen One has organized its
merchandise in such a way that it's easier for a customer to They attend the customers efficiently making sure that
access the desired product. They have departments, then customers are satisfied when leaving the outlet.
sections, and further subsections to facilitate customers.
Presentation
Price Presentation of products is very attractive in the home
Chen One's pricing is done as Maximum Retail Price, fashions section and kids area. They have used cross
which includes production cost, taxes and margins. merchandising techniques which makes it look appealing.
Although, this is called MRP but, as its done in an odd
manner it can also be called as odd pricing. It means, they The apparels section needs no improvement, especially
have priced most of their products as Rs. 95, Rs. 695, etc. in female garments. They have used a lot of different ways
Sometimes, prices

30 Retailing: Success Stories from Pakistan Chen One 31

to display the merchandise. activities are used massively, including visual merchandising,
shop displays, mannequins in all three sections. Window
d) Direct Marketing displays attract a lot of browsers. All these activities
Chen One's uses a number of forms of direct marketing: contribute a lot to Chen One's sales.

Direct Mail
Chen One sends pamphlets to its customers usually telling
them about arrival of new collection or sales. These are
sent firstly to its loyal customers and then to others.

Catalogue
According to the general manager sales, they are about to
launch a catalogue. This would have all the relevant
information about their product range, prices and offers.

Telemarketing
Telemarketing is only done during promotional periods. But
in some rare cases, according to the manager, "we can POS advertising of new arrivals

take orders, depending on the type and size of the order". b) Sales Promotion
This individual treatment can be given in areas like Chen One's sales promotions are mainly on the basis of
furnishings. new product offerings. These promotions are done within
the outlet. A separate shelf is allotted for "new arrivals" in
ADVERTISING
apparel section. They have signs boards within the outlet
If a retailer who carries best assortment of merchandise and to direct customers to different sub-sections. Sales
provides best possible service, doesn't advertise what it promotions are according to the theme of the entire outlet.
provides, all its efforts are useless. Because, what is the use of The themes are different in summers and winters.
having the best products when customers don't know about it?
c) Publicity
Chen One's advertising efforts include both above the line and A lot of articles and issues are printed about Chen One in
below the line advertising: magazines. It's considered a good step towards the
concept of one stop shopping due to wide product range.
Below the line advertising includes print media, shows and A lot of publicity is done by the interviews of Chen One's
other events under Chen One's name. Recently, its print officials in the print and electronic media.
media advertising cost was around Rs. 1.5 million.
d) Personal Selling
Above the line advertising has mixed forms which are listed Personal selling includes the sales people's efforts to
below: communicate the product offerings and contribute towards
sales. Sales people at Chen One contribute to sales by
a) Point of Sales Advertising giving information to customers about which products
Chen One uses both point of sales materials and activities. would suit their needs. They have a lot of knowledge
POS materials are used according to the type of about the merchandise type and how it is supposed to be
merchandise. In apparel section the pillars have posters of used. This helps them to increase multiple purchases. A
models displaying the outfits. In kids section, merchandise good thing is that they give personal space to customers
like toys are playing the role of decorative items. POS

32 Retailing: Success Stories from Pakistan Chen One 33

by not following the customers while they shop.
CUSTOMER SERVICE
e-TAILING People visiting Chen One are either browsers or buyers. People
Chen One is hyperlinked with Chenab Group's website and it don't go there to bargain for products. The prices are fixed and
has its own home page on www.chenone.com.pk. The site so is the quality. Most of the customers of Chen One are
offers displays of various merchandise and home fashion. housewives. They have basic knowledge about the product
Constructed on flash, it has attractive features and animations. range. The employees ensure all customers are assisted.

Online selling facility is not offered on the website; however, Visualizing a customer involves looking at the eye movements,
Chenab Groups are looking forward to it in the near future. the way he touches merchandise, what attracts him/her the
most, and the body language. The employee usually gives the
OPERATING SYSTEMS customer a gentle smile or a greeting to inform them that he is
there to assist them if they need help. They give their customers
The information system used by Chen One is named as
enough time to set their mind and feel easy in the store. The
"Chen One Point of Sale". The Information system is present
employees do not stick around with the customer, they only
in all outlets in Pakistan and is linked with the main Head
answer their queries. When someone is interested in buying a
Office of Chen One in Faisalabad.
product and asks questions regarding the price, colour and
range, only then the employee gives them the information and
The features of Point of Sale include:
suggest alternatives. All the employees are trained to behave
according to the customer. Some people take shopping as a
a) Sales
leisure activity, where as some don't have enough time, some
All the information related to sales is stored in this
people prefer frankness and jokes where as others are only
section. The sales transaction of a particular day can be
interested in buying. They serve them accordingly. Excessive
retrieved easily.
sales techniques are not used in Chen One. Increased
awareness in customers have made these techniques fake. It
b) Stock gives a dishonest impression of the store. "We do not want our
Stocking holdings at the store are fed in this section. customers to feel as if they've been fooled by the store by a low
Merchandise related to each category is listed in this quality product." The employees inform the pros and cons of the
particular section of the information system. The product . For example, a customer looking for a bed sheet might
merchandise are re-furnished on a day to day basis. want a bordered one, the employees tells them clearly the range
he is looking for. If its not available, the customer is informed
c) Returns right away.
The returns are automatically debited from the stocks
received and stored in a separate section.
Some customers visit Chen One so often that the sales people
are familiar with their faces. The employee who served them
d) Attendance
previously repeats his job.
The attendance of all the workers and employees are fed
in this area which assists in calculating working hours.
Customer Loyalty Cards
Customer Loyalty Cards are also offered by Chen One. The
e) Prestige Card Holder's Details
membership promises an array of benefits for the customers. As
The details of the prestige card holders like the personal
a member of prestige cards, the customers are entitled to the
information, address, phone number, number of
following privileges:
transactions etc are recorded here.
n 10% discount on all products at all outlets of Chen One all

34 Retailing: Success Stories from Pakistan Chen One 35

over Pakistan (except tailor made, furniture and art gallery).
n Invitation to all Chen One activities including musical events, fashion shows, food and
theatre festivals, art exhibitions and branch anniversaries.
n Gift packed deliveries in any other Chen One city on a 24
hour notice. Gifts can be delivered to other cities on
payment on courier charges.
n Free Home Delivery on shopping of Rs. 5,000/-

n Chen One news letter.

n Exclusive seasonal packages will be announced from time to
time giving extra benefits to the cardholders.

The member ship fee is Rs. 1,000 only (non-refundable, one

time). The Annual/Renewal Fee is Rs. 500 (payable in advance,
non-refundable). Discount is valid on all promotional activities.

FUTURE OUTLOOK
Considering Chen One's current progress in the retail industry, it
is forced to expand its business. Chen One is making many
new strategic plans.

According to the GM sales, Agha Rizwan, their major plan is to

expand by opening new outlets across Pakistan. Initially, they
plan to open more outlets in Karachi, then in other cities, in
order to meet with increasing customer demands. Currently, the
number of outlets is ten across Pakistan, and their plans are to
take the figure to thirty in the near future.

Another major step, which Chen One is about to take, is going

into electronic retailing. This type of online retailing is very
common in developed countries, but not in Pakistan. With the
help of e-tailing it can cater to not only those Pakistani
customers who cannot access outlets, but also a lot of
customers round the globe. This might take some time, but
eventually will be the pioneer to introduce e-tailing in Pakistan.

36 Retailing: Success Stories from Pakistan

36 Retailing: Success Stories from Pakistan