Reliance gets fresh in Hyderabad, more to follow

Reliance Industries opens a `fresh' chapter this week. The first set of stores in its mammoth nationwide retail play are now open to everyone in Hyderabad.

For a city that buys around 4 million flowers every day for its prayers, the flower racks are the first of the many little things that Reliance Fresh says it has customized for its neighbourhood shoppers.

Reliance Fresh stores are hoping to replace your local grocer, vegetable and fruit vendor in a single sweep. Fresh produce, staples, dairy and frozen food will be packed into these compact stores spread between 2,000 to 5,000 sq ft in area.

"For this pilot in Hyderabad, we are very extensively engaged with customers who are living within a certain radius of the store because it's a friendly neighbourhood store and our intention is to make sure, that we get all our customers who live in the neighbourhood to try out our store," says President and Chief Executive, Foods Business, RIL Gunender Kapur.

Reliance hopes to cater to the specialized needs of the 1,000 to 2,000 odd families within a 3 to 4 kilometre radius, of each of their retail outlets.

Two weeks before the actual date of the launch, the sales force from Reliance actually met all the residents in the neighbourhood in order to create a database of potential customers. They also offered customer loyalty membership cards and an invitation to the launch of their retail store, which promised high quality products and value for money.

But all this hype and strategy has made local grocery store owners in Hyderabad a little nervous.

"It depends on what they will stock and at what price. It is only then that we will be able to tell you how our business will be impacted," says a local Hyderabad retailer P Raja.

Reliance's farm-to- folk supply chain is being tested here as well. Their store in Banjara Hills is procuring produce from the farmers in Andhra Pradesh, Karnataka and Tamil Nadu. This in effect should translate into lower prices by at least 15% to 20%.

"We'll be very affordable and competitive in the market, but we aren't playing a price game here. The full effort is to deliver value to the customer," says Chief Executive, Customer Operations, Reliance Fresh, KS Venugopal.

Reliance Fresh already stocks its own private label in staples and food under the "Reliance Select" label. Eventually the label will include other food categories such as dairy products, jams and even colas.

After ITC's Choupal Fresh and Landmark's Max Retail stores, Reliance joins the list of retailers who have chosen Hyderabad to test the waters, since Hyderabad offers low real estate prices and a population that's happy shopping in supermarkets. In fact, FMCG sales through modern trade are highest in Hyderabad than any other city in India.

There will be 38 Reliance Fresh stores in Hyderabad with 11 opening doors to customers by November 3. Up next, is Fresh Plus, Reliance's second retail format likely to be launched next month that extends to pharmacy, apparel and consumer durables.

And six months later, Reliance hopes to roll-out its Hyper market format that includes 75,000 square feet of multiple brands of apparel, FMCGs, groceries and white goods. Reliance's Rs 25,000 crore retail game may have just begun, but it's for the blue billion to now decide the success of such a foray.

Molshree Vaid & Faye D'Souza