RIL Wants To Digitise Your Neighbourhood Store, Connect It To The Cloud
It calls this initiative “new commerce”, estimating it at $700 billion.
Reliance Industries Ltd.’s retail arm plans to enter what it calls “new commerce” by providing gadgets that can connect to the cloud and point-of-sales terminals to over three crore small merchants in India.
These merchants and ‘kirana’ (small shop) owners, who generate direct and indirect livelihoods for over 20 crore people, form the backbone of India’s commerce ecosystem, RIL’s Chairman and Managing Director Mukesh Ambani said at the company’s 42nd annual general meeting in Mumbai today. “I believe that the small must not only survive, but also thrive in new India.”
That, according to Ambani, would help digitise India’s unorganised retail and is a $700-billion opportunity. The company piloted the concept at over 1,000 such stores in Mumbai, Bengaluru and Hyderabad and is now deploying technologies such as blockchain, internet of things, artificial intelligence and at mom-and-pop stores across India, he said.
“Stores which were part of the trials have witnessed an increase in sales and improvement in margin,” Ambani told investors. “For Reliance, it’s the greatest opportunity to promote inclusive growth and shared wealth at the bottom of India’s commerce and retail pyramid.”
The project is expected to benefit Reliance Retail Ltd., which runs 10,415 stores in India. It registered over 500 million footfalls and has a presence in nearly 7,000 towns and cities, with over two-thirds of its stores in tier-II, -III and -IV towns. These towns, Ambani said, are connected with supply chains capable of delivering products from distribution centres across the country.
RIL said the cloud software will be extended to all levels of distribution. The PoS terminal will be connected to the Reliance Jio Infocomm Ltd. network and will help create an ecosystem around small merchants. The software is designed for inventory management, customer relationship management, financial services and other services. “Customer insights can be leveraged to grow into a much bigger business in the next five years.”
Ambani said Reliance Retail’s turnover (including petroleum retail) in FY19 crossed Rs 1,30,000 crore and its operating margins are amongst the best globally. “Our relentless focus on operating discipline has resulted in a three-fold rise in per store productivity in the last five years.”
Reliance Retail, which currently is among the top 100 global retail chains globally, aims to be among top 20 over the next five years, he said.
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