The move to defer cash & carry operations, at least for the time being, is part of the firm's strategy to conserve cash in a deteriorating market, company sources said.
India's cash & carry market has attracted global retail giants like Wal-Mart from the US with Bharti, Tesco from UK with Tata and Metro from Germany and Shoprite from South Africa. The global giants see it as an opportunity to enter India where FDI is barred in direct-to-consumer retail.
A report in ET said the 36-member cash & carry team formed in 2007 is on the way out after the firm decided not to proceed with the business plan. Mr. Harsh Bahadur had joined Reliance in 2007 after spearheading German giant Metro's cash & carry foray into India for five years.
After talking to potential international partners, Reliance Retail had decided to foray into cash & carry business on its own with 15 locations, mostly tier-II centers like Jalandhar, Ludhiana, Rajkot and Salem, identified as initial destinations for the venture.
It is noteworthy that Metro has made a significant contribution in the sale of wines, especially in Bangalore and Cash and Carry outlets, weherever allowed by law, have a good potential for boosting the sale of wine. Postponement of the plans from Reliance might be a missed opportunity for wine sales in wholesale. |