Reliance Fresh in Hyderabad
November 2006 Hyderabad
on Friday saw the new dawn of a new revolution. Reliance Industries
Ltd’s dreams of a retail revolution got kick-started in the
Pradesh capital when its Reliance Fresh supermart opened its doors to
the world. And, several hundred customers flocked to try out what all
are on offer on the first day.
The inauguration event saw customers cut red ribbons to open
widely believed as Reliance Industries Ltd’s first in the
several thousand stores that are to come. Following the first, the
company opened 10 more on Friday as a first step towards creating a
mega retail chain across the country.
The Reliance Fresh supermarket chain is
Rs 25,000 crore venture
and it plans to add more stores across different geographies, and
eventually have a pan-India footprint by year 2011.
The super marts
will sell fresh fruits and vegetables, staples,
groceries, fresh juice bars and dairy products and also will sport a
separate enclosure and supply-chain for non-vegetarian
Besides, the stores would provide
to 5 lakh young
Indians and indirect job opportunities to a million people, according
to the company. The company also has plans to train students and
housewives in customer care and quality services for part-time
Currently, selling through company-owned stores currently
$8 billion in India. Industry estimates say that the
industry is worth $300 billion, that is about Rs 13,50,000 crore. This
stands a chance to blossom to $427 billion in the next four years.
Organised retail accounts for just over Rs 35,000 crore. Reliance Fresh
bids to tap the potential for organised retail in the country.
The opening of
chains closely follows the moves of
global players like Wal-Mart Stores Inc and Metro AG seeking to open
shop here in the country. With Reliance announcing plans to expand, and
that too rapidly, the retail scenario in the country is all set to take
off in a big way
targets Delhi and NCR for expansion
With over 40 Reliance Fresh stores already launched in Chennai,
and Jaipur, Reliance Retail began its assault of the National Capital
Region market with the recent opening of nine new stores in Ghaziabad,
Noida, Faridabad and Gurgaon.
The company is targeting to open 100 more Reliance Fresh
alone within four months, and a 1,000 new stores in 35 cities
nationwide by the end of the year with a built-up area of over 4
million sq.ft. An investment of Rs.8,000 crore is envisaged for the NCR
Reliance Fresh stocks fresh fruits and vegetables, staples,
moving consumer goods and dairy products. The stores are already
selling over 1,000 tonnes of fresh produce daily and also 250
categories of commodities. The company is approaching farmers directly
for the procurement of produce, seeking to reduce the 40% wastage that
occurs through the traditional supply chain.
Even the hypermarkets and convenience stores
to be launched in the
region will now be bunched together around the city and satellite towns
over the next two months. Among the locations RIL has chosen for
opening retail stores are three sites in Noida, one each in Gurgaon and
Faridabad besides four in Ghaziabad.
However, the roll-out plans for other cities
Along with NCR, the company would make its debut in Ahmedabad, Pune,
Kochi, Bangalore and Chennai over the next few weeks besides expanding
its existing network in Hyderabad.
Already, the cash & carry format
called “Ranger Farm”
outlets have been opened in Hyderabad and Jaipur and these would
eventually be spread to other cities.
The RIL hypermarkets would be spread over
50,000 sq ft and
would stock consumer electronics, apparel and home furnishings, besides
fresh fruits and vegetables.
The Specialty Store format is expected to
launch with high-end apparel initially.
The retail blueprint will see RIL reaching
784 towns, 6,000
rural mandis and 70 of the country’s top cities over the next
The company is eyeing retail space of 100 million sq ft under
its belt by the turn of the decade, a turnover of Rs 1,00,000 crore and
breakeven within the first year of operations.
Reliance Retail juggernaut appears to have slowed down. The
company’s roll-out plans in Delhi are being reworked.
Besides, it seems
that the launch of different retail formats (only convenience stores
and cash & carry outlets are operational at present) is also
a slight delay
According to sources, Reliance Industries
Ltd (RIL) has now decided to bypass Delhi altogether.
RIL has decided against opening stores within Delhi due to the
uncertain real-estate situation here. However, it will set up about 10
“Fresh” stores in the national capital region
Fresh store in U.P.
The biggest industry chamber of Uttar
Pradesh, Indian Industry Association, has come out in full support of
Reliance Fresh outlets and has urged the state government to withdraw
ban on the same.
The association in its state-level executive
committee meeting held at Lucknow today expressed concerns over the
government's decision to impose ban on Reliance Fresh.
"Such decisions will have adverse effect on
the overall economic and social environment in the state," said Anil
Gupta, senior vice-president, IIA.
Now investors may be hesitant to invest in
Uttar Pradesh due to the uncertainty and employment opportunities would
dry out, he said.
"Farmers also may have got better returns
for their produce, had they been able to sell their products directly
to Reliance Fresh instead through the intermediaries," he added.
The committee urged the government to ensure
that the policies are framed in consultation with all the stake holders
and once announced, the policies stay for reasonable time; while care
must also be taken in its implementation.
"Though many policies are announced by
various governments yet there existence is either restricted on paper
alone or are changed frequently," Gupta said.
The IIA expressed hope that the committee
constituted under the chairmanship of the cabinet secretary Sashank
Shekhar to investigate the attacks on the Reliance Fresh outlets and to
study all aspects of the organised retail chains, will submit its
report at the earliest and that government will encourage such
The association said that our country or any
of the state has to adopt new technologies and concepts of business to
keep pace with the world community.