Spencer's Retail to Focus on Profitable Regions, Shut Down Nationwide Operations
Spencer's Retail, the retail wing of the RP Sanjiv Goenka Group, said it would continue functioning in Uttar Pradesh and West Bengal even though it proposed shutting all its stores across the country. "We attempt to ensure profitability by March," said chairman Sanjiv Goenka.
Goenka, in an interview with Moneycontrol, says the company will focus on the two profitable regions that will help it break even by March. The company has chosen to shut down operations in other regions as it has transformed its strategy from the revenue growth mode to bottom lines.
Spencer's Retail is also eyeing e-commerce, which includes 30-minute delivery services. The company has already piloted this in West Bengal and plans to use it in the geographies that the company operates in. According to Goenka, the company is not looking at quick commerce as a revenue generation model but rather as a way to balance losses with revenues.
The Indian e-commerce industry is expected to expand exponentially and gain 27.9% CAGR during 2022-2027. E-commerce users are also expected to reach 60.6 million by 2029. That doesn't mean that it is easy for Finance Minister Nirmala Sitharaman to neglect the predatory price mechanisms of large e-commerce platforms, damaging small traders and small retailers.
Spencer's Retail's strategy to reduce its focus on regions where it may not earn profitability and look for alternative business models seems to be right in step with these issues. With this strategic play, Spencer's Retail would be able to further consolidate its leadership in the Indian retail space and emerge as a big player in the quick commerce space.
