Reliance Industries to digitise kirana stores with "New Commerce"
Reliance Industries has data from its retail business and telecom data from Jio, which will help the company enable kirana stores to sell products efficiently.
Reliance Industries’ retail subsidiary Reliance Retail, which pegs the number of kirana stores in India at more than seven million, is readying a technology platform to bring small retailers into its fold as part of its "new commerce" plan. At present, Reliance Retail's revenue is Rs 130,000 crore - the largest retailer in India so far.
The Indian conglomerate plans to use AI, machine learning, Blockchain, and cloud computing to help kirana stores become competitive. With this move, it will gain data of 900 million Indians, which will help it become a full-stack data company. Not only will it have B2C consumption data, but it will also have B2B data from kiranas and Jio. YourStory reported this first on May 6.
Reliance Retail has data of 350 million Indian shoppers. With Jio, it has accumulated data of 300 million telecom consumers. Now, with this "New Commerce" move, Chairman Mukesh Ambani announced a gargantuan plan at the 42nd Annual General Meeting (AGM) of Reliance Industries to go after data, and at the centre of it is a data-based architecture.
"New Commerce is a massive new business opportunity of $700 billion. However, for Reliance, it is the greatest opportunity to promote inclusive growth and shared wealth at the bottom of India's commerce and retail pyramid," said Mukesh Ambani.
According to him, the main purpose of New Commerce is to completely transform the unorganised retail market, which accounts for 90 percent of India's retail industry.
According to the Reliance Chairman's speech, three crore (30 million) merchants and kirana shop owners, who generate direct and indirect livelihoods for over 20 crore people, form the backbone of India's commerce ecosystem.
"These highly energetic and self-motivated entrepreneurs have suffered in recent years because of their inability to invest in technology and infrastructure," he said.
He added that in true Reliance ethos, the conglomerate is working towards enriching and empowering these kirana stores with an end-to-end digital and physical distribution stack. In fact, Reliance is deploying Blockchain, Internet of Things (IoT), AI, and other new technologies on a pan-India basis.
"This tech-enabled partnership will link producers, traders, small merchants, consumer brands and consumers," said Mukesh Ambani.
At present, Reliance Retail operates 7,573 stores with 17 million square feet in space, and a minimum of Rs 9 crore generated per store. It is now looking to go beyond the combined strength and reach of its digital services through Jio, media and entertainment through Network18 (with a reach of 700 million), and Reliance Retail (with a reach of 350 million).
In FY18, Reliance spent Rs 14,070 crore on indigenous suppliers (small businesses) to work with the retail chain. The company has a presence in 4,400 cities and is now going after fair price shops.
Experiments are also on in Andhra Pradesh to cover 5,000 shops across 10 districts with 400 stock keeping units (SKUs) such as staples, food, and apparel. Last year, they covered more than 100 fair price shops.
Now the future is definitely with Reliance.
(Edited by Saheli Sen Gupta)