Future Retail expects 15 percent sales growth

Future Retail is expecting its sales to grow 15 to 20 percent annually for the next three to four years. The retail giant is banking on doubling its same-store sales to meet this target. The retailer which currently has an operating margin of 3.5 to 4 percent sees it rising by 5 to 7 percent over the medium to long term. Lowering of working capital cycle (from 78 to 60 days) will improve the company’s return on capital employed to 20 percent in the medium term from 15 percent currently. Future Retail now has 749 stores and services over 300 million customers annually.

The retailer has a multi-pronged strategy to boost profitability by expanding its small store network, increasing margins in the food and fast-moving consumer goods portfolio, building an omni-channel network, increasing stock velocity and leveraging its customer data across group companies to increase sales per customer.

Future Retail converted its KB’s Fair Price shops, which were run as neighborhood general stores, into Easy Day small format supermarkets after buying the brand from Bharti Retail last year. The plan is to eventually have 3,000 Easy Day stores from 330 currently. The retailer also plans to open 350 Big Bazaar stores by 2021 from 231 currently.