By Sharleen D’Souza & Sourabh Lele

‘First-ever end-to-end shopping experience’ on messaging platform, says Mark Zuckerberg

Meta Platforms Inc, the parent company of WhatsApp, will partner with Reliance JioMart for a service where WhatsApp users can buy groceries on the messaging platform from the Indian retail firm.

Mark Zuckerberg, chief executive officer (CEO) of Meta Platforms, said in a Facebook post, “[I am] Excited to launch our partnership with JioMart in India. This is our first-ever end-to-end shopping experience on WhatsApp–people can now buy groceries from JioMart right in a chat.”

“Business messaging is an area with real momentum and chat-based experiences like this will be the go-to way people and businesses communicate in the years to come,” he said in an announcement coinciding with the annual general Meeting (AGM) of Reliance Industries the parent company of JioMart.

A Reliance press statement said the service “will enable users in India, including those who have never shopped online before, to seamlessly browse through JioMart’s entire grocery catalog, add items to cart, and make the payment to complete the purchase–all without leaving the WhatsApp chat.”

WhatsApp users can shop on JioMart via by messaging “Hi” to +917977079770.

Mukesh Ambani, chairman and managing director of Reliance Industries, said, “The JioMart on WhatsApp experience furthers our commitment to enabling a simple and convenient way of online shopping.”

“Reliance Retail is looking at touching as many consumers across the country and WhatsApp is a logical platform as India is the largest market for the messaging app in the world,” said Devangshu Dutta, CEO of Third Eyesight, a retail consultancy firm. While WhatsApp is important for growth, Reliance Retail will also need to work on product availability and the cost of delivering to the customer, he said.

Ambani said Reliance’s retail business model has “five imperatives”, or ‘Panch Pran’. These include: enriching customer experience using technology; operationalising and growing multiple channels; integrating with small merchants and providing them a platform to prosper. The fourth imperative is to expand the product portfolio and the fifth one is to strengthen logistics and supply chain.

Isha Ambani, director at Reliance Retail Ventures, said at the AGM that the digital commerce platforms–reliancedigital.in and JioMart–enabled the retail major to deliver 93 per cent of online orders from stores within six hours. “We rolled out our JioMart Digital (JMD) initiative during the year. The platform enables small electronics merchants to sell the entire product portfolio of Reliance Retail on an assisted selling model, helping them deliver superior customer experience and growing their income,” she said.

The company’s new commerce initiative is on course to partner with one crore merchants as it expands to cover the entire country in the next five years, Isha Ambani said.

Last year, Reliance Retail entered pharmacy retail with the acquisition of Netmeds. That year, it launched new operations through Netmeds Wholesale and onboarded merchants in 1,900 towns and cities.

Source: business-standard

Written ByAlakananda Chakraborty

Brand’s positioning may be just below Starbucks

It is against this background that Reliance Brands (RBL) announced its strategic partnership with global fresh food and organic coffee chain, Pret A Manger (PAM).

By Alokananda Chakraborty

India may boast of the presence of several marquee international coffee chains, but none of them, with the possible exception of Starbucks, have been able to make much of an impact. The reasons are obvious; for one, India is largely a tea-drinking market, with coffee penetration still at just about 11%. Coffee remains largely an in-home consumption drink. Then there are the usual challenges of getting prime real estate at a reasonable cost and consumers’ capacity to pay. The pandemic, which disrupted food supply chains and the overall demand, delivered a body blow, leading to shutdown of around 8% of the outlets during 2021.

It is against this background that Reliance Brands (RBL) announced its strategic partnership with global fresh food and organic coffee chain, Pret A Manger (PAM). The first store will open by the end of this financial year. While RBL is tight-lipped about the pricing or positioning strategy, experts say PAM’s biggest advantage is its association with Reliance.

“PAM is a late entrant and would have been at a huge disadvantage if it went alone,” says Anthony Dsouza, executive director & country service line leader, innovation, Ipsos India.

So what does Reliance brings to the table? “Significant investment capability, real estate strength and know-how of retail. These could lead to a much higher scalability and access to the right locations,” says Angshuman Bhattacharya, national leader, consumer product and retail sector, EY India. “However, running a café chain also involves building out the right supply chains across the country, which the brand would need to build,” he adds.

Bhattacharya is bang on. The success of an F&B franchise business depends on getting real estate at the right price. Reliance can offer a tremendous advantage here to PAM. Not only does it run a very large retail business, it also owns malls.

Experts say a lot would also depend on the right pricing. Pramod Damodaran, who had relaunched Costa Coffee India in his earlier stint as COO for that firm, and is now CEO of Wagh Bakri Tea Lounge, says, “There’s a big space between the 240 and170 for a cup of cappuccino, that is, just below the Starbucks/Costa Coffees of the world.”

PAM will probably occupy that window – it is unlikely to be a premium offering for two reasons. One, PAM is primarily a sandwich chain in the UK and it’s not clear how much premium it can command for a pre-made sandwich. Two, if PAM were to take advantage of the retail footprint of Reliance and were to follow a shop-in-shop format, say, in a Reliance Trends store, it can’t afford to be premium. The positioning would be a consequence of that captive audience.

In other words, the store location will, to a large extent, determine both the pricing and positioning of PAM. Agrees Devangshu Dutta, chief executive of Third Eyesight, a specialist management consulting firm: “At the end of the day, PAM is more a quick service outlet than a cafe. (Pret A Manger means “ready to eat” in French). And the consistency of its offering comes from what is called the pre-prep.”

All PAM outlets in the UK follow the concept of “freshness of ingredients” and “quickness of service”. The hero product – the sandwich in this case – is still a convenience food, a grab-and-go item. It is prepared by a central commissary or multiple commissaries and is at the most heated or packaged at the counter. “So it is not a restaurant and it can’t charge a restaurant price,” says Dutta.

In a sense, Domino’s has perfected this model with a lot of pre-prep done at the commissary end but the actual pizza is prepared “at location” or in the store. “In this case (PAM), you are not doing that volume of work at the consumer-facing counter,” Dutta adds. And if that is the model RBL plans to replicate in the country, the positioning, by default, is mass.

“The PAM-Reliance combination is likely to be a mass market offer, with value pricing and highly localised strategy,” Dsouza of Ipsos says.

But mass or premium positioning, PAM’s entry will no doubt roil the waters. “Incumbents have to up the food game if they want to take on the might of Reliance,” says an executive with a rival brand. Beverages form a dominant part of the café industry sales. Besides food and beverages, merchandising, which is employed largely for branding, is rapidly becoming a source of additional revenue. About 60-65% of café sales come from beverages, followed by food which forms about 20-25% and about 10% from merchandise.

For one, Tata Starbucks, which witnessed a 76% growth and logged `636 crore revenue in FY22, has been working at its food menu and delivery for some time. In a recent interview to FE BrandWagon, Sushant Dash, CEO, Tata Starbucks, had said that the brand had to “re-prioritise” because of the pandemic, with innovation becoming more important to keep the brand relevant. Starbucks innovated with the menu to keep the interest level up among customers and introduced new food items and gave the existing food items an Indian twist,” he had said.

Earlier this month, Starbucks added masala chai, filter coffee and an array of bite-sized snacks and sandwiches to its menu card. Its new milkshakes will be priced starting at 275, while masala chai and filter coffee will start from190. It also introduced the ‘Picco’ – meaning ‘small’ in Italian – starting at `185.

Will that be enough? Given PAM’s strong presence in the food space, there is no denying that existing café chains in India have to tweak their food menu considerably. In other words, they will have to get out of their comfort zones.

Source: financialexpress

Akash Podishetty & Krishna Veera Vanamali, Business Standard

New Delhi, 8 July 2022

India’s $900 billion retail market has emerged as one of the most dynamic industries and is expected to reach anywhere between $1.3-$1.5 trillion by 2025. The organized retail is seen gaining 15% market share in the overall retail space, while food & grocery and apparel and lifestyle may account for 80% of India’s retail market by 2025.

Large market offers big opportunities. And it looks like Reliance Retail has seized it, with its massive omni-channel retail play of physical stores, B2B with kiranas and e-commerce.

The company went on an acquisition spree and partnerships in the last three years, adding to its portfolio some of the biggest names, including Hamleys, Dunzo, Zivame etc.

It has also partnered with famous global retail chain 7-Eleven. Catering to India’s affluent consumers, Reliance, meanwhile, houses some of the most iconic brands such as Versace, Armani Exchange, GAP, GAS, Jimmy Choo, Michael Kors among others. The premium segment has become one of the fastest growing categories.

Also firming up its inorganic play, the company is planning to acquire dozens of niche local consumer brands to build a formidable consumer goods business.

Arvind Singhal, Chairman and Managing Director, Technopak Advisors says, there’s focus on physical retail expansion. Reliance is looking to cater to both price conscious and brand conscious customers, while trying to capture as much of the private consumption market as possible, he says.

Reliance Retail’s competitors are nowhere close to even put up a fight. The company has over 15,000 offline stores across categories, compared with DMart’s 294 stores or Aditya Birla Fashion’s 3,468 outlets.

Reliance retail’s revenue has grown five times in the last five years and the core retail revenue of $18 billion is greater than competitors combined, according to a Bernstein report.

Speaking to Business Standard, Devangshu Dutta, CEO, Third Eyesight, says, Reliance wants a decent share of Indian consumers’ wallet. From that perspective, Reliance still has a long way to go, he says. As consumer preferences evolve, Reliance too should adapt.

An undisputed leader in the domestic market, the aim of Reliance, according to Mukesh Ambani, is to become one of the top 10 retailers globally. Part of this bet is based on the premise that incomes and consumption power of Indians will increase across the board in coming years. However, could the uneven recovery that different segments of the population have seen stop the pie from growing larger and prove to be a dampener for Ambani’s ambitions?

(Published in Business Standard)

Written By Aditya Kalra & Abhirup Roy

MUMBAI, June 30 (Reuters) – Reliance Industries (RELI.NS) said on Thursday it would open outlets of Pret A Manger in India under a franchise deal with the British sandwich and coffee chain, a first foray by the Indian firm in the country’s growing food and beverage industry.

Reliance Brands Ltd (RBL), a unit of the conglomerate that also runs India’s biggest retail chain, would start by opening branches of Pret, as the brand is known in Britain, in big Indian cities, both companies said.

RBL Chief Executive Darshan Mehta said in joint statement the partnership was “rooted in the strong growth potential” of the Pret brand, known for its organic coffee and upmarket sandwiches, and the Indian food and beverage industry.

The first outlet would open in Mumbai before March 2023 and India was expected to become one of Pret’s top three markets in three years, a source familiar with the matter told Reuters.

Pret A Manger, whose name means “ready to eat” in French, first opened in London in 1986. It now has 550 outlets globally, including in the United States and several European states. It is owned by investment group JAB and founder Sinclair Beecham.

In India, the brand will compete with Starbucks (SBUX.O), which has a joint venture with India’s Tata, and Costa Coffee, which is owned by Coca-Cola (KO.N).

Mukesh Ambani, one India’s richest men, runs Reliance, which has more than 2,000 supermarkets and grocery stores in India. Reliance also has partnerships with luxury brands, such as Burberry and Jimmy Choo.

“Reliance wants to look at retail in all its shapes and forms. Over time, they’ve realised partnerships are the way for business formats that may be difficult or slower to crack,” said Devangshu Dutta, head of retail consultancy firm Third Eyesight.

Source: reuters

Written By Mukherjee, ET Bureau

Top listed retail chains such as Aditya Birla Fashion & Retail, Avenue Supermarts and Tata-owned Trent are going to lead store additions through the next financial year, as they double down on expansion after the pandemic, company executives and analysts said.

As per a recent report by ICICI Securities, 16.7 million square feet of retail space would be added by eight large, listed retail chains between FY21 and FY24 as compared to 8 million square feet added in the preceding four years of FY18-21. These companies also include Titan, Bata, V-Mart, TCNS and Shoppers Stop.

The buoyed sentiment comes after the recovery of retailers to more than their pre-Covid levels in the last two quarters, and is also driven by pentup demand, strong sales despite increasing prices and expansion into small-tier towns, the report said. There has been an expansion of the market which is happening along with a consolidation, said Devangshu Dutta, chief executive of consulting firm Third Eyesight. “Not all locations might turn out to be viable, but in every expansion cycle there are boom and bust. And the bust is not as big as the boom. Right now, we are in the expansion cycle,” he said.

Aditya Birla Fashion & Retail managing director Ashish Dikshit told analysts recently that the company would expand rapidly since plans were held up in the last two years due to the pandemic, with faster growth for fashion business, ethnic wear and inner wear. The company, which had raised ₹2,195 crore from GIC Singapore, intends to invest ₹600-800 crore for expansion in the next couple of years.

“…we continued to believe both in the long-term growth potential of the market and intrinsic strength of our brands and we feel now the time is to accelerate to catch up on what we have not done over the last 12 to 18 months and I would go back almost till the beginning of the Covid period from 18 to 24 months where some of our growth initiatives have held back,” said Dikshit.

As per the ICICI report, Avenue Supermarts would add 7.5 million sq ft during FY21-24 for the DMart stores as compared to 3.9 million sq ft added in FY18-21. Aditya Birla Fashion & Retail would add 3.1 million sq ft as compared to 1.2 million sq ft in preceding four years, while, among others, Trent would add 2.7 million sq ft (vs 1.5 million sq ft), Shoppers Stop would add 0.8 million sq ft (0.2 million sq ft) and Bata would add 0.7 million sq ft (0.2 million sq ft).

India’s largest retailer, Reliance Retail, too has accelerated expansion plans including taking its stores into new geographies, Gaurav Jain, head of strategy and business development told analysts recently.

Source: economictimes