Reliance Retail to increase value formats

Reliance Retail will double its stores across all formats within

the next five years. Currently it has 1,050 stores and a pan-India presence. Of these, 650 are value format stores, while 400 are specialty ones. The plan is to have an expansion in the value format stores. The contribution of value retailing in Reliance Retail’s total revenue has dropped to 50 per cent from 65 per cent in the last two years due to expansion of the specialty formats.

Food items, that accounted for around 35 per cent of the total sales from a store till 2009-10, now account for almost 50 per cent of the total sales. By the end of this fiscal, Reliance Retail plans to add around 150 more stores across the country. Till December 2010, the company had set up 200 outlets. On an average, a Reliance Retail value store is spread across 2,000 to 3,000 sq. ft. and has over 6,000 stock-keeping units. The cost of setting up such a store is one crore rupees.

Reliance Retail plans to expand operations in Uttar Pradesh, where it initially ran into rough weather due to political agitation. However, the company will have to wait till the Uttar Pradesh government revokes the ban on grocery retailing to expand the value retailing business. The initial focus will be on apparel, jewelry and other specialty formats. Uttar Pradesh had ordered closure of Reliance Retail operations in 2007 due to political agitation against large organized retailers perceived as threats to small kirana shops.