Retail business conglomerate, Future Group will now sell only food, fashion and home furnishing products, the company’s CEO Kishore Biyani on Tuesday (February 26) said.
“We have made mistakes. We got into so many categories of business. Now I have decided not to move out of food, fashion and home,” PTI reported, citing Biyani as saying at the Retail Leadership Summit.
While retail is Future Group’s core business activity, its subsidiaries are present in consumer, insurance, brand development, real-estate development, retail media and logistics.
The founder reiterated that the group has been betting big on data-driven commerce. In November 2017, the group launched the Retail 3.0 business model, called Tathaastu, which incorporates the best of both Retail 1.0 (brick and mortar stores) and Retail 2.0 (ecommerce).
In the 3.0 model, the group has integrated newer technologies, such as artificial intelligence (AI) and machine learning (ML), where data can be used to understand customers’ purchasing behaviour and also predict their needs. The conglomerate is said to have already implemented the technology for its Easy Day stores.
An earlier report suggests that the group plans on investing $68.8 Mn–$110.3 Mn to create a nationwide food supply chain network of refrigerated trucks. As part of the plan, the company would set up temperature-controlled distribution centres (DCs) to manage its entire food supply.
Future Group Bullish On Growth With Small Store Strategy
Further, Biyani has announced to add 10K small store outlets. The company which owns and operates brands such as BigBazar, Nilgiris, EasyDay, operates more than 1,400 stores across 409 cities at present.
“Our large stores make a lot of money and our small stores are not making money. We expect in the next two years they will start making money. We have profitability of large stores which funds our small stores right now,” he said.
Meanwhile, in line with its small store strategy, the group is reportedly bringing Japanese-owned convenience store chain — 7-Eleven — to India. The deal will be based on a revenue-sharing model, with technology sharing, for 70-80 years licensing arrangement.
Group’s retail chains like Easy Day, Heritage Retail, Nilgiri’s contribute about 15% to Future Group’s sales. The company clocked a revenue of $2.6 Bn (INR 18,478 Cr), according to its annual report 2017-18.