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Reliance targeting big on ‘BtoB’ business, hopes to garner 1 lakh crore in revenue

Reliance is betting big on BtoB business, being carried through ‘Rangers Farm’ cash and carry wholesale format.

‘Rangers Farm’ stores stores mainly sell fresh vegetables and farm produce in bulk to small merchants and push cart vendors. While, Rangers Farm stores service the needs of Reliance ‘Fresh’ stores on one hand, they help small time shop keepers and vendors to realise benefits of the supply chain efficiencies, on the other.

Cash & Carry business has huge potential in India, where 97% of estimated 12 million retailers are very small in size, who can not afford back-end support.

Currently, Germany’s Metro Cash & Carry chain, South Africa’s ‘Shoprite’ and home grown ITC’s Chaupal ‘Fresh’ are some of the players who have set shop in this format. However, competition is likely to hot up in a few months with the spread of these chains as well as the entry of the world’s biggest retailer Wal-Mart’s entry in the country with its Sam’s Club chain of stores.

The initial response to Rangers Farm format in Hyderabad has been very encouraging with more than 4,000 push cart vendors and small shopkeepers are said to be picking up supplies of food and vegetables in bulk, every day.

According to Reliance officials, the company is keen to garner Rs. 1 lakh crore revenue from this format in the next five years.

Reliance ‘Fresh’ at Pune, Bangalore, Hyderabad, Mumbai & Gujarat in 3 months

Having already opened 49 ‘Fresh’ stores in Hyderabad, Jaipur, Chennai, NCR and few smaller cities of Andhra Pradesh, Reliance Retail, the Rs. 30,000 crore retail initiative of Reliance Industries is gearing up to open 250 ‘Fresh’ within the next two months, in Pune, Bangalore, Hyderabad, Mumbai, Ahmedabad, Vadodara, Surat, Jamnagar, etc.

During the same period, apart from opening ‘Fresh’ stores, which is the existent food and grocery neighbourhood convenience format, Reliance will also open hypermarket and niche retail format stores.

These stores, apart from selling known brands, will also offer merchandise carrying private labels, including ‘Reliance Select’ an in-house label for staple products, which has already been introduced in the existing ‘Fresh’ stores.

Among new services, Reliance is considering offering free delivery of merchandise to customers’ homes. This may directly impact small retailers as customers could save time and effort on procuring goods without sacrificing on the advantages of buying from a big chain like Reliance. According to reports, such deliveries may, however, be restricted up to the distance of three kilo meters.