Nov 25, 2016, 06.56 PM | Source: CNBC-TV18
On the first day of cash dispensation the company saw around 50,000 transactions conducted, says Kishore Biyani, Chairman, Future Retail.
Kishore Biyani (more)
CEO, Future Group |
In an interview with CNBC-TV18 he said that modern trade has been doing really well and same store sales jumped to 40 percent on Thursday.
After the first days of demonetisation sales picked up and the company saw a sales growth of around 20-50 percent in last two weeks, he said.
Biyani said that the usage of debit card payment has increased significantly and contributes to around 50-60 percent of sales.
He said that cash transactions fell to 8 percent after November 8 but it has steadily increased to around 20 percent of sales currently.
Below is the verbatim transcript of Kishore Biyani's interview to Latha Venkatesh, Sonia Shenoy & Anuj Singhal.
Latha: Drawing money from point of sale (POS) machine was always allowed, right? You are only activating it further because of the cash crunch?
A: It was always allowed but there was a particular feature which had to be reconfigured, which has now got reconfigured in every of our store in Big Bazaar. Yesterday was our first day of dispensation and we must have done close to 50,000 transaction of swipes.
Latha: You wouldn't have a cash crunch, would you?
A: If I become selfish, modern trade has been doing very well rather our growth has been much more than what we expected. I think the same store sales have jumped to - yesterday was 40 percent plus, in weekend we were 50 percent. Therefore, in a sense it is a good time for us right now.
Sonia: Can you tell us this withdrawal facility is available in how many stores as of now and do you plan to increase the reach?
A: It is currently available in around 260 of Big Bazaar and FBB stores. Some of our Central stores have activated it, some of our Brand Factory stores have also activated it and our small stores Easy Day should also activate it in the next few days.
Anuj: Is it right that November 8th to 15th period was the best for your group in terms of sales?
A: The first two days were not as good but after that we have seen growth starting from 20 percent to 50 percent.
Anuj: What is the anecdotal evidence because you see a lot of people coming and buying groceries, a lot of transaction is cash but has the digital transformation been smooth or do you think there has been some trouble?
A: Most of our customers have debit cards. If you look at the kind of profile of people we deal in, I would assume that 90-95 percent of our customers had debit cards with them and they must have never used it or they use to swipe it to get money out of the bank.
However, now we are encouraging them to use debit card into our stores. So from November 8th, the debit card percentage has grown significantly and not the credit card percentage, in fact credit card percentage has slipped by a percentage or so. Debit card percentage has touched nearly 55 percent to 60 percent of our sales.
Sonia: Can you give us some more details on the transactions. You said 50,000 transactions were conducted yesterday. What was the quantum of money that you have dispensed and how much do you have on offer over the next month or so?
A: It is not about the money which we have. Our cash collection right now, when the demonetisation event happened on November 8th, our cash sale dropped to 8 percent and since then it has subsequently increased and it is in upwards of 20 percent now. So we collect cash from the customer which is coming in and that is getting circulated, so we have a lot of money in our system which can handle close to 100,000 transactions a day.
Latha: Are your supplies coming in time. We hear about trucker distress, transportation dislocation. Did you have to experience any such?
A: We run our own logistic company fortunately and we manage our own supply chain and that is helping us in this hour wherein we have been able to stock ourselves quite well and that is another reason for our business being better than the rest.
We have been very proactive on these terms; in fact we have formed a war room to handle situation like this and our fill rates have never been better than what it is today because the whole organisation, the machinery has come together to make this adversity into something which can be helpful for us and the customers as well.