DECEMBER 15, 2022
After disrupting the telecom services space, multi-billionaire Mukesh Ambani has launched his next offensive. This time, he is eyeing the country’s vast fast moving consumer goods (FMCG) market, which is already the fourth-largest in the world.
Armed with a host of fast-moving packaged food and beverages (F&B), Ambani’s Reliance today forayed into the market under its in-house brand Independence. To begin with, it has chosen the Gujarat market where the products are being launched today. Incidentally, Ambani and family originates from the western state of India.
Under Independence, the group has lined up wide ranging packaged goods items. From wheat flour, crystalline sugar, besan and toor dal to branded rice, biscuits, edible oil and packaged drinking water – Reliance’s move encompasses nearly all key F&B categories.
Announcing the launches, Isha Ambani, Director, Reliance Retail Ventures, said, “I am happy to announce the launch of our own FMCG brand INDEPENDENCE which brings a wide choice of high quality and affordable products including edible oils, pulses, grains, packaged foods and other daily need products. The brand stands for ‘truly Indian solutions for real Indian problems’ which is articulated as – ‘Kan Kan Mein Bharat’, thereby evoking emotional attachment and instilling a sense of inclusiveness amongst Indians.”
The packaged F&B brand is owned by Reliance Consumer Products Ltd. – which in turn is a wholly-owned subsidiary of Ambani’s consumer business behemoth Reliance Retail Ventures (RRVL). Apart from the newly launched FMCG business, RRVL also operates the conglomerate’s retail business. With over 16,500 outlets, 2 million merchants and close to Rs 200,000 crore yearly turnover, RRVL is by far the largest retailer in India.
While Ambani has been aggressively planning his entry into the FMCG market, its foray in the wide-ranging categories at once has now placed Reliance directly in competition with the country’s leading consumer goods players like ITC, Tata Group and Britannia. While ITC is the largest player in the packaged wheat flour market, with over Rs 3,500 crore in sales from the category, Tata Consumer Product’s Sampann is betting heavily on the packaged kitchen items like pulses and spices. Britannia and Parle, apart from ITC, dominates the biscuits market in the country.
Though, Reliance would stick to the Gujarat market for sometime and build its F&B brand from there, sources say, the project has been launched to test waters. Eventually, it plans to go pan India with its F&B portfolio. And with RRVL as its parent, Reliance Consumer Products already has an edge over other FMCG makers as it has its vast network of modern retail outlets to begin with.
Last year, RRVL has catered to nearly 200 million retail customers – up 230 per cent over FY2021, while its digital commerce platforms (like JioMart and Milk Basket) served 600,000 orders on an average every day. According to Isha, RRVL’s merchant partner initiate – launched two years ago – now has over 2 million merchants on board. “We add about 150,000 partners a month and are on course to [reach] 1 crore merchants (partners) as we expand our presence to cover the entire country, serving over 7,500 towns and over 500,000 villages in the next five years,” she said during the annual general meeting of Reliance Industries in August. To back it up further, it has tied-up with Meta (formerly Facebook) to allow consumers to order through WhatsApp.
According to the senior Ambani, while RRVL is already a leading player in the modern retail and digital platforms, the company has set a target of increasing its reach in the hinterlands that remains under-served.
“In this endeavour, our strategy is to integrate with millions of small merchants…the aim is to bring them to become an integral part of the widest distribution portfolio across the country so that they can provide the same choices to their customer that are available in big cities,” he said during the AGM.
Additionally, according to Mukesh Ambani, RRVL is also working on to strengthen its supply chain capabilities further so that it can serve across the vast Indian geography in the “most efficient manner”. This will not only help it reduce waste but will also allow the company to pass on the benefits to its customers – which effectively means, it will be able to offer products at competitive prices.
Courtesy/Source: Business Today / PTI