Following a self-imposed freeze on expansion in the wake of the global financial crisis, Reliance Retail is planning to branch into smaller cities and towns, competing for market share with independently-owned stores and street markets.
Speaking to livemint.com, Reliance Retail president Bijou Kurien said the retailer plans to first expand into large cities classified as tier-one and tier-two, before entering cities and towns classified as tier-three and tier-four. “There is an opportunity for 2,000-5,000 stores,” he said.
Currently, Reliance operates 660 stores in less than 100 cities, but the move to extend its reach into smaller cities is seen as a business necessity as property prices in large cities have risen sharply.
“In the next two or three years we can expect most modern retailers to expand to these (smaller) cities. There is purchasing happening there,” said Arvind Singhal, chairman of retail consulting company Technopak Advisors Pvt Ltd.
With modern style retail accounting for just 3 per cent of India’s $400bn retail market the company is looking to imitate neighbourhood groceries known as Kirana stores, reports livemint.com.
Downscaling store sizes and offering a home delivery service are some of the ways Reliance Retail is looking to pry market share away from small independent retailers.
