Kishore-Biyani-Future-GroupThe brick and mortar retail sector is clearly in the mood to take up the battle and go all guns blazing against the rival online sellers. This is understandably started by the BIG B of retail Mr. Biyani, who is the mogul of Indian consumer goods market. Around 2 months ago, he had arranged for a meeting at the Marriott Hotel at Hyderabad where we discussed the need to restructure the entire process and think big for they have to get the “re-born” Future group in front of its customers. He also has a visual presentation called “Re-born” that depicted the fresh start for the company in the business in order to tackle the on-going competition.

2 Big-Breaks from the past:

Biyani plans to entertain massive brands in the field of FMCG (fast moving consumer goods) segment like ITC, HUL and others; at the same time also has his own labels that he needs to market and sell. In near future, he believes FMCG will be a crucial profit maker along with generating whopping amounts of revenues.

The second breaking point of his plan is allowing customers to buy from anywhere. Yes, this might sound familiar to the online shopping experiences that are changing the roles in the industry. In few weeks from now, one can place an order using the online application that will be released soon. Select Big Bazaar stores in Mumbai will have this facility initially before spreading it all over. Under this “Re-born” shopping experience several permutations and combinations of purchasing stuffs will be provided to the consumer such as they can order online and ship it home, they can order online and pick them up from a nearby store, they can order at a store and have it delivered home, they can even order from a particular store and pick the same order from another branch of Big Bazaar.

This convenient purchasing experience will be provided at all the Big Bazaar branches and it will slowly bought to practice in other stores too like in Easy Day, Nilgiris and KB’s Fairprice.

Out of the 75,000 crores revenue for the group, FMCG is expected to contribute 10,000 crores


Online sellers, a BIG challenge for Big Bazaar:

It is an undeniable truth that the brick and mortar stores have been bleeding losses due to the online e-commerce stores. According to market reports footfalls in these physical shopping stores had declined by about 12% during the peak festive season in late 2014. Revenues recorded by the likes of Flipkart and Snapdeal totaled to more than 81,000 crores INR whereas, the collection by Future Group’s three listed companies together clocked at just a mere 8,000 crores INR. There is a double worry for Future Group as it has to tackle the online players at one end and there is stiff competition like the Reliance Retail that is a 5 year junior yet today it is at par valued at 17,640 crores INR for the year ended 2014/15.

Planning from own brands:

Mr. Kishore Biyani is probably the first and the only retailer in India who is planning his own retail brands and getting ready to sell it outside his stores. His brilliant supple chain network is projected to be his biggest strength in the attempt. Market observers project a fair chance to Future Group in case they get the branding and packaging part right. His clean “never-default” bank records are ought to work in his favor big time as fund procurement will never be a problem for the group.

The discount nuisance needs treatment:

This is one thing that the Future group requires to think about with utter seriousness. Online stores have this habit of throwing regular discounts at customers which is practically not possible with the brick and mortar stores. However, Mr. Biyani seems to be working on this one too as the company all set to launch a ‘Price Match’ mobile app shortly. Using this the customer will know retailers selling products at a cheaper rate than Future Group, if this is proved (which is completely done by comparing with the use of the app), then the additional price gap will be directly credited to the buyer’s account and a SMS alert will be delivered on the mobile about the same.

According to Mr. Kishore Biyani, this is a calculated risk which is sure to work on a long run as the group is promising the least price possible. He further says that now it is for the competitors who should be worried. Overall, the group is positive about its business plans and hopes to change the consumer market yet again, this time with the Omni-Channel business model.

As Mr. Biyani says people aren’t taking his company for serious and that is always good for them as they have a point to make.