Airline to retail: SpiceJet to foray into food, apparel sector
Budget airline, SpiceJet may soon enter the retail sector, a report by CNBC-TV 18 said on Tuesday.
Media reports quoted sources that said the company was on the final stages of preparation of entering the ‘retail business.’
Sources said that this venture will operate separately from SpiceJet’s airlines business as the company was looking for wholly owned stores across malls in metro cities of India to sell products under the ‘Spice’ brand.
A report by Business Standard said that the foray will be through a separate subsidiary company called SpiceJet Merchandise Private Limited which was incorporated last year and added that while SpiceJet owns 99% of the company, 1% was held by promoter Ajay Singh.
Merchandise, apparel and electronic products will be available in the physical retail stores while customers could also go online where the company will also start a ‘distribution channel.’
CNBC reported that SpiceJet’s online channel will compete against retail giants like Future group and e-commerce companies like Amazon and Flipkart.
However, a report by Money Control said that the company’s online venture will not be like other e-commerce companies, where third-party sellers sell directly to shoppers through online portals.
The airline’s online retail store will also offer its own brand, the report added.
The company will “engage in the business of consumer merchandise and goods that will include electronic items, readymade apparels, accessories, among others," the BS report said.
SpiceJet did not respond to Zeebiz’s queries.
The airline has had a huge turn-around story as only a couple years ago it was on the verge of closing down.
The company in 2015 had posted a loss of Rs 687 crore and has posted a profit of Rs 181.143 crore in the third quarter of FY17. It has also signed a Rs 1.5 lakh crore deal to purchase 205 Boeing planes on February 13 this year.