We have a target to grow by 18-25% in FY19: Rakesh Biyani, Future Retail
Rakesh Biyani, Joint Managing Director, Future Retail Limited, spoke about consumer sentiments, different formats of business and expansion plans during an interview with Swati Khandelwal, Associate Editor, Zee Business.
Rakesh Biyani, Joint Managing Director, Future Retail Limited, spoke about consumer sentiments, different formats of business and expansion plans during an interview with Swati Khandelwal, Associate Editor, Zee Business. Edited Excerpts:
Q: Let us know about the kind of impact that festive season had on demands and sentiments going on further?
A: Dussehra and Diwali are two big festivals of India and they lead to fresh consumption of products. The numbers/demand has been a satisfactory one in the clothing/apparel section. I think the demand was in the same line as last year. However, the demand was subdued inexpensive sections, like electronic items.
Q: What is your outlook on revenue growth for FY19 and do you feel that you will be able to meet the target amid the ongoing demand?
A: We have a target to grow by 18-25% and we are running inline with it. I feel, we will have a two-digit growth across the year and we are performing well across different sections.
Q: The small format of future retail has performed better than the big format. Do you think that the trend is here to continue, if yes, let us know the reason?
A: September quarter results must not be compared with the same quarter of the previous year due to the difference in Dusshera timings of the two years. Dusherra was celebrated in the month of September in 2017, which led to booking in the month while it, Dusshera, was celebrated in mid-October of 2018.
Secondly, small business is a new format for us and we are expanding it. At the same time, we are also working on plans to improve our supply chain network and hope that both the formats, small and big, will perform well in future.
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Q: I would like to know your plans for different formats like FBB, Hypercity, EasyDay?
A: The Future group has set its expansion plans for the next few years. It will be increasing its network in each of the sections by opening new outlets in different cities. Interestingly, expansion work is on track and is in line with the CapEx that was announced for it. Expansion details:
Big Bazaar: 25-30 stores.
FBB: 25 stores.
Easyday: 500 stores.
Q: Name the region/cities, on a geographical basis, where you will be expanding yourself in by next year? Provide details of the stores that will be launched in the region?
A: We have the focus on the expansion of Big Bazaar in few states like Bihar, Uttar Pradesh and Maharashtra. We have cluster expansion plans for Easyday under which more stores will be opened in the existing 13 clusters.
Q: Let us know about the targets that have been achieved through the Omnichannel strategy, used under the digital model? Also, inform us about your digital spread strategy of Future Retail?
A: Much progress has been made on the Omnichannel platform as it is providing an online shopping facility to customers. It is a facility where products can be picked from the stores even though an online order was placed for it. Similarly, products ordered at the stores can be delivered at the doorsteps of the consumer.
Besides, under stage II of our plan, which is being implemented, we will try to deliver products from the nearest outlet/store. This cost-effective mechanism will help us in speeding the process of delivery.
In addition, we are also trying to create some segments that will be exclusively available on the online platform. The segment will be created within a year.
Q: What is your view on e-commerce policy that will be brought soon? What is something that you will like to see in it that will ensure growth for both, the retailers and e-commerce players?
A: I feel, both, e-commerce as well as retailers, are selling to the need of the end customer. In a way, everyone is in the retail business. Thus, we should have a comprehensive policy that addresses the total retail business in India. The policy will enable the government to monitor and allow others to compete in the space.
Besides, the existing channel or brand specific policy should be done away, as it is dividing the industry.
Q: What is your view on a merger or stake sale?
A: One should have an open mind that alliances, mergers and acquisitions are part and partial of the business. We support such ideas when we are confident that the deal can bring a good value for our shareholders. As a management team, we are open to such ideas.
Q: Convenience of consumers is a mantra for Future Group. So, should we expect that the group will come with some new services that will ease the shopping experiences of the consumers?
A: We want to be a one-stop destination that can fulfil all the demands of the consumers may it is related to household goods or services. We are working on it and have started an insurance facility in it and are trying to come up with the credit finance facility. In fact, we have several ideas and am sure that several things will be rolled out in the next two years.
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