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New ecommerce platform created with help of Reliance Jio Infocomm.

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New ecommerce platform created with help of Reliance Jio Infocomm.

State of Gujarat first to trial new project

Reliance Retail, part of the Reliance Industries conglomerate, has partnered with Reliance Jio Infocomm to announce the creation of a new ecommerce platform. The new platform will be optimised for use on the JioPhone, a popular mobile handset that was introduced by Reliance Jio in 2017. Till date, more than 40m JioPhones have been sold in India.

Some innovations announced for this marketplace include making use of augmented reality and holograms to provide shoppers with an immersive shopping experience. With an initial target of 1.2m small retailers in the state of Gujarat, the platform will allow retailers to increase their reach and visibility substantially.

Healthy Q3 sales

The retailer also announced that Q3 earnings for the entire Reliance Retail group rose to more than US$4.9b, a rise of 89% versus last year. The strong growth was attributed to a combination of increased sales during the festive season as well as store openings.

Reliance Industries chairman, Mukesh Ambani said, “In our new-age consumer businesses, we maintained robust growth momentum across retail… and the share of consumer businesses is steadily increasing its contribution to the overall profitability. As we execute on our strategies to deliver superior products and services to Indian consumers, I am confident Reliance is well-positioned for the future and for the next cycle of growth.”

The Reliance Retail group has businesses in grocery retail, fashion and lifestyle, consumer electronics, telecommunications and petrol retailing.

Find out more information about Reliance Retail here.

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Another giant ecommerce player may enter Indian market.

Investment of at least US$5 bn from Alibaba

Talks have begun between Alibaba and Reliance Retail about the possibility of creating a mega retail joint venture. Jack Ma, Alibaba’s executive chairman and Mukesh Ambani, Reliance Industries Ltd. chairman met recently to discuss plans to create an omnichannel retail entity.

If it proceeds, the joint venture aims to challenge the Walmart-Flipkart alliance as well as Amazon India in one of the largest economy in the world.

For Alibaba, the partnership is a way to expand its physical retail business while Reliance Retail will benefit from the digital marketplace expertise of its partner.

Although Alibaba currently has a 49% stake in Paytm, an Indian digital payments platform, its efforts to make further inroads into India were hampered by recent legislation. On 1st August, the Reserve Bank of India instructed Paytm to stop recruiting new customers, following concerns raised about its enrolment process.

More about Reliance Retail

Reliance Retail is one of the largest retailers in India and operates neighbourhood stores, supermarkets, hypermarkets, wholesale cash and carry stores, specialty stores and online stores. It operates under the banner of Reliance Fresh, Reliance Smart, and Reliance Market.

More information about Reliance Retail can also be found here.

 

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Revenues have more than doubled from previous year.

Positive performance driven by increase in store network

For the financial year that ended in March 2018, Reliance Retail has reported revenues of US$10.37bn, more than double from fiscal year 2016/7. It now has the honour of being the first retailer in India to cross the US$10bn mark in revenues. The Indian conglomerate has also reported net profits of US$1.4bn, a year-on-year increase of 17.3%.

Reliance Retail’s positive performance is driven by an increase of retail space. Total retail space across all its formats grew by 30%. It currently has 3,837 stores across 750 cities with an area of more than 17.7m sq ft.

To touch every home in India

Reliance Retail has a stated goal of touching every home in the country, and that objective is being aggressively pursued. The strong revenue growth is a result of an increase in the store network as well as the retailer building its ecommerce business.  

Mukesh Ambani, chairman of Reliance Industries said, “We have established strong foundations in retailing and digital services business with world-class supply chain management and network infrastructure which will serve our customers well. It is very heartening to see the traction our service offerings are gaining, with discerning Indian consumers.”

More information about Reliance Retail can be found here.

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India's largest retailer, Reliance Retail, is planning to add more stores.

Stepping up expansion plans

Reliance Retail went through a round of consolidation last year, closing 60 outlets under the Fresh banner, its convenience store format. It seems to be in expansion mode this year. The retailer plans to open 200 grocery stores (under Fresh and Smart banners), 300 wholesale outlets (under Market), 300 fashion stores (under Trends) and up to 600 fuel stations. The total investment is expected to be around INR25bn (US$382m).

About Reliance Retail

Reliance Retail runs 12 retail formats including Reliance Fresh, Reliance Smart, Reliance Trends, Reliance Digital and Reliance Jewel among others. It operates 3,553 stores across 686 cities as of December 2016. It is India's largest retailer by store numbers.

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Reliance Fresh, the convenience store format of Reliance Retail, has closed 60 stores over the last year to cut losses.

Loss-making stores facing higher rental

Reliance Fresh is the first format launched by the company in 2006. The convenience stores sell food and grocery, contributing to approximately 50% of Reliance Retail’s revenue in FY2016. There are currently over 500 stores over 80 cities. The company chose to shut down 60 outlets that were constantly loss-making. Many were also facing increased costs as their leases were up for renewal. 

New format expansion driving profit

Reliance Retail is focusing on expanding Reliance Smart, launched last year. It offers a one-stop shopping experience, including grocery, home and personal care products and general merchandise. It is also often co-located with fashion and electronics stores, Reliance Trend and Reliance Digital. This format started in Mumbai and Pune, and is expected to widen its network. The company is likely to continue its growth momentum on turnover and margins.

About Reliance Retail

Reliance Retail is the retail arm of Reliance Industries, an Indian conglomerate which owns businesses in retail, energy, petrochemicals, textiles, natural resources and telecommunications. Reliance Retail runs 12 retail formats including Reliance Fresh, Reliance Smart, Reliance Market, Reliance Digital, Reliance Trends, Reliance Footprint, Reliance Jewels, amongst others. Over the last 9 months, Reliance Retail opened 308 stores, taking the total store count to 3,553.

Want to know more about online retailing in Asia?

RedMart is Singapore’s leading online grocery retailer and was recently acquired by Southeast Asia’s largest online marketplace retailer, Lazada. To explore the opportunity of online retailing in Singapore and potentially partner with RedMart, attend the retailer’s annual supplier conference in Singapore on 23 February.

 

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