Reliance has launched attacks against HUL, Nestle, P&G; Plans to set up huge FMCG
The country’s largest company, with annual sales of $ 100 billion, is poised to overtake foreign multinationals in the consumer goods market. Reliance Industries, which already owns India’s largest retail chain and is equipped with more than two dozen private label brands, plans to rapidly expand its consumer core business by acquiring more than 50 brands.
According to sources, the company, led by billionaire Mukesh Ambani, targets a huge consumer goods market dominated primarily by American and European multinational corporations such as Procter & Gamble, Unilever, Nestle, Reckitt Benckiser, L’Oreal and Colgate-Palmolive. Others, for almost a century. Reliance has allocated Rs 50,000 crore for the acquisition bit – the world’s third largest – to claim a share of the country’s nearly Rs 7,500,000 crore consumer goods and retail market.
Reliance’s interest in consumer goods is not new. Over the past decade, the group has expanded its presence in organized retail space through its two affiliates, Reliance Retail Limited (RRL) and Reliance Strategic Business Ventures Limited (RSBVL). While RRL has expanded its retail footprint to more than 15,000 physical outlets, created multiple digital features like the Ajio and accelerated omni-channel play, RSBVL has become a handful of strategic investments and acquisitions.
Over the past few years, the group has actively added new brands and expanded its consumer product portfolio into packaged foods and beverages, personal and home care and fashion, consumer sustainable and apparel spaces. Snactac (range of snacks, biscuits, instant noodles, etc.), GoodLike (pulses, rice and edible oils), yes and local kitchen (like instant mix, flour, pickles) have entered the fast-growing branded F&B space. And mixed spices) have been directed.
Netplay (formal office wear), Performax (special active wear), Fusion (fusion-wear for women), AVAASA (ethnic clothing for women) and Rio (fashion wear for working women) have emerged in fashion and clothing. It has partnered with at least 47 prominent global brands over the past few years, including Armani Exchange, Diesel, Gas, Humless, Hugo Boss, Marks & Spencer, Steve Madden, Tiffany & Co.
In addition, a bunch of acquisitions helped it grow its presence quickly. Only on FY2021-22, the group has acquired or invested in fashion brands like Abu Jani Sandeep Khosla, Abraham & Tagore, Ak-Oke, Rahul Mishra and women’s intimate clothing brand Clovia.
According to company management, it is focusing on developing “own brand portfolio in segments of health and disease-enhancing food groceries, and productivity devices and appliances in consumer electronics”. In addition, the group is “building a portfolio of its own brand for new businesses,” with its focus on “exclusive brand licenses and own brand products through Reconnect, JioPhone and LYF,” it said in its annual report. In FY2021, Reliance Retail collected more than 75 percent of the revenue from its ‘own brand’ under its fashion and apparel chain Reliance Trends. (Reliance) For Trends Footwear, personal labels contribute more than 60 percent.
In FY2021-22, Reliance added 75 new warehouses and perfection centers to support its growing retail and consumer footprint. Revenue from the fashion and apparel segment grew 55 percent, 750 labels were launched and its presence in small towns increased. Not only does it own one of the largest retail chains in the consumer electronics and sustainable space – Reliance Digital – but it is also pushing domestic products through private labels such as Reconnect, resQ, Kelvinator and BPL. During January-March FY22, it recorded a 50 percent sequential increase over the festival quarter. “Merchant partners across the country, including small towns, offer a wide assortment of electronics and home appliances across different segments,” the company said.
Preparations for an all-out attack on consumer goods have been underway for some quarters. During FY22, to strengthen its workforce, Reliance Retail added more than 150,000 new employees – bringing the total headcount to 361,000. “In line with rapid expansion, a high proportion of these jobs will be in non-metro, Tier 2 and 3 cities and beyond, where businesses are rapidly expanding their physical store network as well as digital and new business platforms,” it said.
Read more: Reliance to acquire dozens of brands in খেল 6.5 billion consumer goods game: report
Also read: Reliance is now the top Indian company in the Forbes Global 2000 list
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