Spinach readies for Rs 400-cr expansion
Fresh food retailer Spinach i has made an outlay of Rs 400 crore to spread pan-India. Social networking at shop floor
By Nikhil Menon, TNN |
MUMBAI: Fresh food retailer Spinach i has made an outlay of Rs 400 crore to spread pan-India. The move follows the Wadhawan group retail arm taking over a number of ailing retail outlets and nascent formats such as S-Mart in Bangalore, Maratha Co-operative Store (with which it signed a management contract) and home delivery service Sangam Direct in Mumbai and Delhi-based Home Market and Sab Ka Bazaar.
The acquisitions had helped Spinach grow to 165 stores. ���We are expanding to 10 more cities this year, with a budget close to Rs 400 crore,��� Spinach CEO Pushpamitra Das told ET. The company will fund the expansion through a combination of promoters��� funds and debt.
Spinach is also considering acquiring more retail chains that are in need of financial support. Maratha Co-operative stores, for instance, was plagued by massive inefficiencies, low margins and a total lack of technology infusion before signing a management contract with Spinach in 2007.
The acquisitions had helped Spinach grow to 165 stores. ���We are expanding to 10 more cities this year, with a budget close to Rs 400 crore,��� Spinach CEO Pushpamitra Das told ET. The company will fund the expansion through a combination of promoters��� funds and debt.
Spinach is also considering acquiring more retail chains that are in need of financial support. Maratha Co-operative stores, for instance, was plagued by massive inefficiencies, low margins and a total lack of technology infusion before signing a management contract with Spinach in 2007.
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���Today, we have not only improved the fundamentals, we are also planning to open 10 more Maratha co-operatives this year,��� Mr Das said. At the same time, Sangam, which was earlier a Mumbai-specific home delivery service for FMCG goods, grains and pulses, is now being revamped. It will soon go national and be integrated with Spinach group���s brick and mortar stores.
���We will merge our distribution centres, connect all our new stores to a call centre and reduce home delivery time from 24 hours to 6 and eventually 2 hours,��� Mr Das said.
Due to its growing footprint, the company is tying up its logistics end that will shore up its national sourcing as well as supply chain. Mr Das said talks are on with logistics firms such as Mahindra Logistics, Agility and TCI supply chain solutions.
These firms will deliver fresh fruits and vegetables from the distribution centre (where they are bought from farmers) to the new outlets in these ten new cities. The group is aiming to cut down the time for the produce to reach the store from the distribution centre from the current 18-20 hours, to between 10 and 12 hours.
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