Reliance Retail to expand chains

Wednesday, 31 August 2011

Reliance Retail, India’s largest organized retail company, is set to expand its supermarket and hypermarket chains. The company has overcome all the obstacles that came between its retail expansion plans and right now the group is all set to go ahead with it. Reliance retail has various formats namely- Reliance Fresh (small neighborhood stores), Reliance Digital (consumer goods) and Reliance Trends (clothing). The group scaled up rapidly to 1,000 stores in 86 cities in three years since its launch in November 2006. Then it hit the economic slowdown. The number of stores remains 1,000 even now, though it has added some stores and closed some. Of the total, 650 stores are value retail and the remaining specialty stores.

The company is planning to double its store count this year in several specialty formats. Reliance Retail has hired a new management team, which has been given two years to make the business profitable. They will have to focus primarily on the food, FMCG and electronics business. They will also have to focus on the big plans for the cash and carry segment. These core focus areas are expected to turnaround the retail business. It’s not the only retail chain which faced the slowdown. According to industry estimates around 2,000 retail stores have shut down which include 1,650 stores of Subhiksha Trading Services and 150 each of Spencer’s Retail, run by RPG Group and stores of Aditya Birla Retail. The giant retailers experienced huge liquidity crunch and inventory pile-up problems as customers stayed away. But now the scenario seems to be changing. Like Reliance Retail, even ABRL, which has hypermarket and supermarket stores under the More brand, will open 12 hypermarkets in fiscal 2012. It will also open 150 supermarkets this fiscal, taking its supermarket stores count to 715. Shoppers Stop, which currently has 43 departmental stores and 10 hypermarkets under the brand Hypercity, plans to open four more hypermarkets and 10 departmental stores this year.

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