News: Reliance plans retail expansion
(IANS 25/04/2006) New Delhi - From a fleet of aircraft to ferry farm fresh produce to cities, to cold storage chains, speciality stores, mega malls and convenience stores, Mukesh Ambani's vision for Reliance Retail encompasses a wide variety of business models to reach the consumers.
The attempt is to be the best and the largest in the country by ensuring a presence in all districts, and in all major towns and cities, industry sources say.
The multimillion-dollar retail venture is set to take off with the first of the many malls slated to open in Ahmedabad in October. It is expected to see an investment of $700 million in the first phase.
Along with Wal-Mart, Reliance Retail has drawn inspiration from several successful business models in India like Big Bazaar, Spencer's, Shoppers' Stop and the Gujarat Cooperative Milk Marketing Federation (GCMMF) among others.
Even the traditional village marts where farmers sell their produce once a week are being developed for creating rural hubs.
"The village hub or market place will be the aggregation and segregation point for farm fresh goods. These rural business hubs would also serve as the retail point where farmers would be able to buy seeds, fertiliser, equipment and even take loans in tie-ups with banking institutions," said an industry insider who keenly follows the developments.
It is from these aggregation points that Reliance Retail would take on a high-tech shape with plans afoot for not only setting up warehouses and cold storage facilities but also food processing units and even operation of cargo planes for delivering farm fresh produce, he added.
"Reliance is in the process of seeking clearance from the civil aviation authorities to operate a fleet of 30-40 small and medium aircraft of 30-60 tonnes. The idea is to reduce wastage and provide the best quality produce to consumers," said a senior company official, who however hastened to add that company rules did not permit his talking to the media.
Work is on at all levels to create the infrastructure and to tie up supplies - be it vegetables and fruits from farmers or electronic and other products from global sourcing majors such as Hong Kong's Li & Fung that supply to large chain stores like Wal-Mart.
Delhi, Kolkata, Bangalore, Chandigarh, Baroda, Pune and Hyderabad are among cities earmarked for front-end operations like malls speciality stores, hypermarkets, supermarkets and convenience stores. The major focus will however be on smaller cities, towns and districts.
Reliance Retail has already acquired large tracts of land in Haryana and a similar exercise is on in states like Andhra Pradesh, Gujarat, Himachal Pradesh, Karnataka, Punjab, Tamil Nadu and Uttar Pradesh.
Negotiations are soon set to conclude for about 900 acres of land in Punjab, which is set to become the hub of dairy processing activities of Reliance Retail. To execute these mammoth projects, Reliance has been on a major talent hunt that has led to immense churning in the top and middle rungs of several companies, headhunting firms said.
So far about 2,000 people have been recruited for Reliance Retail and another 5,000 will be added over the next few months.
The attempt is to be the best and the largest in the country by ensuring a presence in all districts, and in all major towns and cities, industry sources say.
The multimillion-dollar retail venture is set to take off with the first of the many malls slated to open in Ahmedabad in October. It is expected to see an investment of $700 million in the first phase.
Along with Wal-Mart, Reliance Retail has drawn inspiration from several successful business models in India like Big Bazaar, Spencer's, Shoppers' Stop and the Gujarat Cooperative Milk Marketing Federation (GCMMF) among others.
Even the traditional village marts where farmers sell their produce once a week are being developed for creating rural hubs.
"The village hub or market place will be the aggregation and segregation point for farm fresh goods. These rural business hubs would also serve as the retail point where farmers would be able to buy seeds, fertiliser, equipment and even take loans in tie-ups with banking institutions," said an industry insider who keenly follows the developments.
It is from these aggregation points that Reliance Retail would take on a high-tech shape with plans afoot for not only setting up warehouses and cold storage facilities but also food processing units and even operation of cargo planes for delivering farm fresh produce, he added.
"Reliance is in the process of seeking clearance from the civil aviation authorities to operate a fleet of 30-40 small and medium aircraft of 30-60 tonnes. The idea is to reduce wastage and provide the best quality produce to consumers," said a senior company official, who however hastened to add that company rules did not permit his talking to the media.
Work is on at all levels to create the infrastructure and to tie up supplies - be it vegetables and fruits from farmers or electronic and other products from global sourcing majors such as Hong Kong's Li & Fung that supply to large chain stores like Wal-Mart.
Delhi, Kolkata, Bangalore, Chandigarh, Baroda, Pune and Hyderabad are among cities earmarked for front-end operations like malls speciality stores, hypermarkets, supermarkets and convenience stores. The major focus will however be on smaller cities, towns and districts.
Reliance Retail has already acquired large tracts of land in Haryana and a similar exercise is on in states like Andhra Pradesh, Gujarat, Himachal Pradesh, Karnataka, Punjab, Tamil Nadu and Uttar Pradesh.
Negotiations are soon set to conclude for about 900 acres of land in Punjab, which is set to become the hub of dairy processing activities of Reliance Retail. To execute these mammoth projects, Reliance has been on a major talent hunt that has led to immense churning in the top and middle rungs of several companies, headhunting firms said.
So far about 2,000 people have been recruited for Reliance Retail and another 5,000 will be added over the next few months.
posted by InCar Group Press Room at 22:48
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