Spencer’s hires BCG to put business in order and find foreign partner

KOLKATA/NEW DELHI: Spencer's Retail, the retail flagship of RP-Sanjiv Goenka Group, has hired consultancy firm Boston Consulting Group ( BCG) to spruce up its organisation structure in line with global standards and help it find a foreign partner, two people familiar with the situation said.

BCG is overhauling the Kolkata-based retailer’s structure in areas such as merchandising, new store opening, customer analytic and in-store space optimisation, using global retail majors as a benchmark. The move, they said, is a precursor to Spencer’s plans to either rope in a foreign partner or go for an initial public offering ( IPO).

Mohit Kampani, chief executive of Spencer’s Retail, confirmed the retailer has hired BCG, but would not share more details. A spokesperson for BCG declined to comment.

Spencer's Retail currently operates 31 hypermarkets, having total trading area of 10.2 lakh square feet. The company has already signed up properties to open 20 more such super stores time 0by March 2015, which will take its total trading area to 16.5 lakh sq ft.

In the next four years, Spencer’s plans to add 80 new stores, the two people quoted earlier said. One of them said Spencer’s is also on a hiring spree to rope in senior talent from the industry for skills such as analytic, merchandising and retail processes such as pricing manage-ment and promotion management.

The retailer is also making some changes in role for employees. However, such re-structuring is not going to lead to any job retrenchment, the person said.

Spencer's Retail reported a net loss of Rs 209 crore in the year ended March 2013, down from Rs 255 crore in 2011-12. While the company is already profitable at the store level, Spencer's is expected to break even by next fiscal.

Sanjiv Goenka, chairman of RP-Sanjiv Goenka Group, had earlier told ET that Spencer’s would raise funds once the company achieves profitability and that it would consider different options including an IPO or selling stake to a foreign partner.