Reliance Industries Ltd. is planning to grow the total number of low-cost Reliance Trends fashion stores across India to 2,500 from 557 over the next five years and integrate them with its online business, said sources familiar with the plans.
The expansion is the latest move by RIL chairman Mukesh Ambani to grab a dominant share of Indian consumer spending in a struggle with rivals, particularly e-commerce giants Amazon and Walmart-owned Flipkart.
Reliance’s plans to diversify into e-commerce and expand has come soon after the implementation of reforms in FDI policy in e-commerce that have dealt at least a temporary blow to Amazon and Flipkart.
Narendra Modi’s government modified FDI rules for e-commerce, barring online retailers from selling products via vendors in which they have an equity interest and also from making deals with vendors to sell exclusively on their platforms.
The expansion plan should allow Reliance Trends, which sells accessories as well as clothing, to rapidly grow its private labels—the retailer’s own brands.
Reliance Trends would be in 300 cities in five years, from 160 at present, confirmed sources.
A Reliance executive said integrating the availability of private labels with its e-commerce venture and penetrating deeper into smaller, tier-III and -IV cities is the next level of growth for Reliance Trends.
Last year, Reliance Trends opened over 100 stores.
Ambani’s so-called “new commerce” venture aims to connect small and mid-sized merchants with his retail network and warehouses, helping them better manage inventory as well as boost sales of Reliance’s private labels.
Almost 80 percent of Reliance Trends’ revenue comes from private labels which offer products like jeans, trousers, shirts and t-shirts.
