Reliance Retail to enter wholesale business soon: Ambani | Mayoreo ...

courtesy of mydigitalfc.com

Reliance Retail today said it will soon launch cash-and-carry format stores for wholesale business,

while its consumer-focused business will become a market leader across all formats in the next two years in India.

Addressing Reliance Industries shareholders at the company?s 37th AGM, the Chairman and MD Mukesh Ambani said Reliance Retail will ?soon? launch cash-and-carry format stores to offer numerous national and international brands to small traders across the country.

Reliance Industries Ltd (RIL) had forayed into the retail arena with Reliance Fresh stores selling fruits, vegetables and other grocery items in 2006.

Upon entry into the wholesale space, RIL will compete with multinationals like Germany?s Metro, USA?s Walmart and French retailer Carrefour, which have already set up wholesale stores in India.

Even UK-based Tesco is working on plans to set up its first cash-and-carry store in the country amid anticipation that the government is likely to ease FDI norms in both the wholesale and retail formats.

According to industry experts, RIL?s plan to enter the wholesale business is an attempt to establish a strong supply chain to compete with international players, who are likely to become aggressive if FDI norms are relaxed by the government.

?RIL is realising that there is more value in capturing the supply chain and back-end rather than just being present on the front-end.

If the FDI limits in retail are relaxed, a lot of international players will expand in India both on the front-end and the back-end. By entering the cash-and-carry space, RIL is seeking a stronger presence,? an analyst with a leading consultancy firm said.

While FDI is not allowed in multi-brand, India allows 51 per cent foreign investment in single brand retail and 100 per cent in the wholesale cash-and-carry format.

Asserting that Reliance Retail has already become largest food retailer in the country, Ambani said that all the specialty formats of the company would attain top positions in their respective segments in the next two years.

Ambani also said that Reliance Retail has already got the largest portfolio in terms of the number of formats and 25 lakh customers were shopping at the company?s various stores every week.

He said that further growth was expected in the retail business on the back of future investments and Reliance Retail was currently at an inflection point.

The company currently operates 1,000 stores across 86 cities in the country, he said.

The firm also has partnerships with international brands such as Marks & Spencer, Apple, Asics, Timberland, Zegna, Diesel and Paul and Shark. ?We continue to add a suite of best global brands across multiple categories,? he said.

Source: http://blog.mayoreo.com/2011/business/reliance-retail-to-enter-wholesale-business-soon-ambani/

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