RELIANCE RETAIL- A FRESH APPROACH TOWARDS RETAILING IN INDIA
SUBMITTED BY : RAJNEESH RAJN EESH AND DEEP D EEPAK AK
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Reliance Industries Limited (RIL) is an Indian conglomerate company headquartered in Mumbai, India. The company operates through three business segments: Petrochemicals, Refining, and Oil and Gas, other segments include Textile, Retail business, special economic zone development and telecom/broadband business. RIL is the largest publicly traded traded company in India by market capitalization and second-largest public corporation in India when ranked by revenue. The company is listed on Fortune Global 500 and Forbes Global 2000
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Reliance was found by Dhirubhai Ambani .
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Reliance started with textiles in 1975 .
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Reliance pursued a strategy of integration - in POLYESTER, FIBRE INTERMEDIATES, INTERMEDIATES, PLASTICS PLA STICS, PETROCHEMICALS, PETROCHEMICALS, PETROLEUM REFINING AND OIL AND GAS exploration and production, TEXTILES, RETAIL, INFOTEL and special economic zones.
Major subsidiaries and associates •
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Reliance Life Sciences Reliance Industrial Infrastructure Limited Reliance Logistics Reliance Clinical Research Services Reliance Solar Relicord Infotel Broadband Ltd Reliance Industrial Infrastructure Limited Reliance retail
Vision "Growth has no limit at Reliance. I keep revising my vision. Only when you can dream it, you can do it.“
Dhirubhai H. Ambani
RELIANCE RETAIL
What Is Retail?
Retailing involves selling products and services to consumers for their individual or family use. As the final link between consumers and manufacturers, retailers are a vital part of the business world. Retailers add value to products by making it easier for manufactures to sell and consumers to buy. Retail Retail is usually classified by type of products as follows —
Clothing & Footwear
Home Furniture & Household
Non veg or Veg
Food Retailers
Indian Retail Sector
Leisure & Personal Goods
Health & Beauty Products
Durable Goods
Food and Beverages
Example Future Groups-Formats: Big Bazaar, Bazaar, Food Bazaar
Reliance Retail Limited (RRL) Reliance Retail, Ltd. is a subsidiary company of Reliance Industries.
Founded in 2006 and based in Mumbai, it is the second largest retailer in India. Its retail outlets offer foods, groceries, apparel and footwear, lifestyle and home improvement products, electronic goods, and farm implements and inputs. It focuses on consumer goods, consumer durables, travel services, energy, entertainment and leisure, and health and well-being products, as well as on educational products and services
Vision Reliance Retail Limited (RRL) “Growth through Value Creation”
Various Retail Formats • • • • • • • • •
Reliance Fresh Reliance Jewels Reliance footprint Reliance Super Reliance Mart Reliance Digital Reliance trends Reliance Wellness Reliance Timeout
Strategic Strat egic RRL RRL •
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Based on its core growth strategy of backward integration, RRL has made rapid progress towards building an entire value chain starting from the farmers to the end consumers. Open Retails in SEZ Gurgaon, Jhajjar in Haryana Maturing Metros Online retailing Rural Retailing Innovative Formats like “Wedding Malls” Strategic licence Agreements
An Overview of Case Study •
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RIL’s plan of venturing into the unfamiliar territory of retails.
RIL retails expansion strategy into India one of retails most promising market.
The Indian Retail scene •
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India rank first in A.T Karney study for top international destinations. Indian market is of US 350 billion dollar retails market market in which 96% held by 12 million family run shops. Indian market have currently account for b/w 2 to 6% organized sector of total retail. Retail market increased by 15% to 18% year 2011.
THE RELI RELIANC ANCE E RET RETAIL AIL STRA STRATEGY TEGY •
Strategic Partnerships
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Rapid expansion
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Supply Chain from farm to Fork Fork
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New ventures
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Dynamic Leadership
Strategy Partnership •
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Trail partnership with struggling govt. owned cooperative store- SAHAKARI BHANDAR in Mumbai. Secondly, Ambani plans to build hyper mart titled RELIANCE MART spread over 180000 sq ft selling all things target 784 towns & eventually expending into big city.
Rapid expansion •
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Moving Rapid toward it target target of opening and operating 100 million sq ft of retail of 6000 outlet in 784 city & towns by 2010 & 2011. Going ahead from retails giants such as Carrefour and Tesco.
Supply chain from farm to fork •
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The Reliance ‘AGRO RETAIL STRATEGY’ plan consist of creating a supply chain network that would integrate integrate two of modern India (agriculture and retail) retail)
RIL plan to capitalize capitalize the backwardness of infrastructure of India. RIL plan to open 1600 huge procurement & distribution hub title “Reliance Mandis”.
New Venture •
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RR using e-commerce as a platform to link its front-end retail with the back-end logistics. The two E- commerce strategic strategic is B2B & B2C. RR is aims at having having co- brand credit credit cards cards & consumer finance schemes. Reliance fresh start customer loyalty program (from dec. 2006 to march 2007. 50000 member join in Jaipur alone) RR plan to enter in non-food FMCG category category..
Dynamic leadership •
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RR work under Mukesh Ambani owner of flagship petrochemical refinery the 3 rd largest in world. M. Ambani is top India's richest list with net worth of US 18 billion dollar. He joined Reliance Industries in 1981.
Board Memberships •
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Chairman, Managing Director, Chairman of Finance Committee and Member of Employees Stock Compensation Committee, Reliance Industries Limited Former Chairman, Indian Petrochemicals Corporation Limited Former Vice Chairman, Reliance Petroleum Chairman of the Board, Reliance Petroleum Chairman and Chairman of Audit Committee, Reliance Retail Limited. Chairman, Reliance Exploration and Production DMCC Director, Member of Credit Committee and Member of Compensation & Benefits Committee, Bank of America Corporation.
SWOT ANA ANALLYSI YSIS S STRENGTH Private Label sale -own Products (Reliance Select) Contract Farming Network-1600 Channels in villages Network-1600 Brand Equity Good Financial Position Backward Integration : Reliance retails is among the few organizations which entered Indian Retail sector with backward integration. Demographic favour
WEAKNESS: staff-Lack
of Knowledge about products
Parking lack
of basic infrastructure like power, transport and communication communication Absence of developed supply chain and integrated IT management. Lack of trained work force & Low skill level for retailing management. Lack of Retailing Courses and study options
OPPORTUNITIES farm
to fork, No middlemen, farmers-customer Rising Consumerism of the Indian High population of India Growth retail market - Global retail Development Index – high demand Sectors with high growth potential Falling real estate cost E-retailing Retail franchising and Rural retail Potential for investment
THREATS International
retail and domestic retails e.g. Wal-
Mart Indian governments FDI policy in retail Restrictions on real estate purchases, especially as imposed by local governments and against "big-box" chain retailers” Unfavourable taxation structures Unfavourable High competitiveness among existing market participants and resulting low profit margins
Porter’s five force model
Porter’s five force model 5 Forces
Analysis
Rivalry among the competitor
•Big Bazzar, Aditya Birla Group , Vishal Retail’s, Retail’s, Bharti and Wal-Mart, etc
Threat of entrants • Financial capital max paid up. • distribution •.Government policy •Economies of scale
Bargaining power of supplier
•The bargaining power of suppliers varies depending upon the target segment. •Distribution of Raw material.
Bargaining power of buyers
• Consumers are price sensitive.. •Availability of more choice. •Switch up of consumer •Internet shopping portals
Threat of substitutes
FUTURE STRATEGY Plans
to invest Rs 25000 Crores in next 4 year in their retail division
New
Format of food and cafe - Reliance food
Pharmacy 6000
retails store
outlets -784 cities
Launch
soaps, Detergents, Detergents, cosmetics and non FMCG products-Private label
SUGGESTIONS Expand Give
-Service
training to staff staff
Improve
Inventory Control
Increase
supply chain
Reach
to the Rural India.
Come
up with food FMCG.
Work
on Markting Mix
