After realty and construction, organized retail is emerging as the most promising sector in India. If you are to name who are the most prominent players in this arena, you’ll count Pantaloons, Shoppers Stop and others, but not Reliance, and certainly not the Bharti group.
All that will however change very shortly, perhaps before the year is even halfway through. Bharti’s high-profile tie-up with America’s monstrously giant, Wal-Mart 2 months back has lent a rush of urgency to the sector.
There was temporary relief when political parties raised hue and cry over Wal-Mart’s ‘backdoor’ entry in India. Even that now stands cleared after the commerce ministry confirmed early this week that their tie-up is perfectly in order.
Reliance meanwhile hasn’t sat idle. Going by news reports, it first wanted to enter into pacts with local realtors in every city, whereby the store-space will remain with realtors while Reliance will simply put up and operate the stores. But Wal-Mart’s imminent entry seems to have changed Reliance’s plan.
It no longer seems to be waiting for pacts for space. It’s now on space-acquiring spree having already taken up 1.5 lakh sq ft in Calcutta Riverside’s Batanagar project, and another 62,000 sq ft in Bengal Peerless’ multi-utility mall, Axis in New Town. Both are long way off to actually come into being, and so the rush is so markedly noteworthy.
How will Reliance’s plan unfold? Not clear yet, but it appears there’ll be hypermarts in large spaces where ‘everything under the sun’ (much like Wal-Mart’s format) will be sold. Further, there will be any number of RelianceFresh retail outlets (they’ve opened some early Nov in Hyderabad) where vegetables, fruits, flowers and select groceries will be on offer for consumers. [Picture on left: RelianceFresh in Hyderabad; source]
It’s not only infrastructure that Reliance has set its eyes on. Going by a ET report yesterday (Jan 18), Reliance Retail plans to take on its roll a mind-boggling one million employees by 2010. The outlay for this venture is – hold your breadth – Rs.25,000 crore. Now only 22-stores old, Reliance Retail will scale that up to 1500 covering a wide gamut of products.
Ironically, ITC, whose village-level retail initiative, e-choupal, is supposed to be the first planned foray in retail sector, is now lagging far behind in this supercharged scenario. But then, who knows the future may be quite different.
An ITC e-choupal in Sagar, MP [Picture source]
Related reading: Onrush of retailing
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