to 40 traditional retailers in the past one year that were looking to modernise their stores.
The success of the kirana stores has led retail baron Kishore Biyani to open a new format called KB’s Fairprice, under which the company offers franchisee model to grocery shopkeepers through a nine-year agreement. Shopkeepers are required to pay a registration fee and the initial working capital.
“The group is rapidly expanding KB’s Fairprice chain through the franchisee network. We believe KB’s Fairprice will be the key channel and catalyst for the growth of company-owned FMCG brands and help make Future Consumer Enterprises among the leading FMCG companies in the country,” says Biyani.
Future Group, like its other counterparts in the food and grocery space, is experimenting with smaller store sizes and a change in its product mix. Most supermarket chains in the country are saddled with losses due to mounting costs and low margins. Tata’s Star Bazaar is cutting down the size of stores by 50% to 30,000 square feet and did not open a single store in FY13. Shoppers Stop’s HyperCity is also experimenting with the 30,000-square-foot model, while bringing in products like apparel that have higher margins.
Abheek Singhi, partner, The Boston Consulting Group, recently said that in all global markets except Brazil, the top three retailers were home grown. “The local players understand the different needs of the consumers, unlike a uniform model that big chains have,” he added.