Spar-Max to invest Rs 550 cr in 3 yrs in expansion; targets cities
Spar, the world’s largest food retail chain, is to open its first office in North India in Delhi on January 19. This would inaugurate operations in the northern region, after having set up five stores in southern cities such as Bangalore, Mangalore and Hyderabad.
Spar hypermarkets and supermarkets operate in India as a result of a licence agreement between Dubai-based Landmark Group’s Max Hypermarkets Pvt Ltd and Spar International. While Max is responsible for the entire business operation and management control, Spar is the knowledge partner and transfers technical expertise and best practices in international retailing. Spar International is a UK-based retail chain, operating in 35 countries.
With an aim of opening 15 stores by next year and 30 stores by 2013, Viney Singh, MD, Max Hypermarket, says, “Our focus is to deliver an international shopping experience and take care of the finer details in the layout, design, merchandise, operations, service, safety and hygiene in our stores. Our tag line, ‘Live Life Better’, emerges from this philosophy. We ensure we are delivering our Indian customers the same quality and standards as in developed countries.”
These details would be keeping sufficient aisle space to facilitate movements of two trolleys simultaneously, customising bakery offerings to the local catchment area, profiling customers’ habits and creating concepts suited to their needs, big malls ensuring ample car-parking space, developing specialised customer experience zones, the largest number of payment counters to save time, standard ceiling height and provision of eateries near the bakery, and restaurants where people can take a break from their shopping and munch on their takeaways.
Singh says, “We have developed special zones called ‘worlds’, depending on the people’s shopping habits. These ‘worlds’ are ‘Kitchen’, ‘Fresh Food’, ‘Children’, ‘Electronics’, ‘Clothes’, etc. Also, the positioning of the items on the shelf would be according to the priority in shopping. Our whole effort is to provide convenience and organised shopping experience to our customers.”
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The upcoming malls in line would be at the Pacific Mall in Rajouri Garden in Delhi, one in the MGF Metropolitan mega mall in Gurgaon and others in cities like Pune, Coimbatore and Hyderabad. These five stores would be set up by the end of March. Max is to invest around Rs 550 crore over the next three years, with an average investment of Rs 10 crore on each store.
Middle class upwards
Singh adds, “We are really inspired by the Future Group, the largest retail chain in India, and look up to the kind of scaling they have done within a short time span. We are focusing on metros, Tier-I and Tier-II cities as of now and targeting the middle and upper-middle class.”
Spar has also come up with a value for money offer to its customers, including an ‘every day low price’ concept, a ‘lowest retail price’ on certain fast moving consumer goods every day, best deals every fortnight offering bargains up to 75 per cent, and a customer loyalty programme that can be used not only in Spar retail but also in other brands of the Landmark group. Singh adds: “A consumer can earn and burn his loyalty points on his card anywhere within various brands of the group, unlike other retail chains.”
The company claims to take care of everything and not to outsource any product or service from outside, to maintain its quality and discourage mishandling. It promises to provide the widest range of brands possible in India under one roof. The highlights would be offering loose cereals as per the consumer’s needs, importing certain fruits and vegetables, sourcing fruits and vegetables directly from farmers, maintaining at controlled temperatures till these reach stores within an 18-hour timeframe and quality assurance in the non-vegetarian section.
Adds Singh, “The food section is our forte — fresh food, street food, continental dishes. We deliver 200 varieties of fresh fishes under the ‘Daily Fresh Catch’ section. Our people ensure these fishes are bought from various ports early in the morning and flown to our stores in a few hours. We have the biggest tandoor and meat section, wherein we ensure everything, right from the sourcing, buying of carcass, chopping of flesh, marinating, tracing, adding spices, preparing and supervising, all done by us.”
The company finds a great opportunity for modern retail in India, saying penetration is just four-five per cent. Food and grocery retail penetration is even lower, at less than three per cent. “We see this as an opportunity and are planning to promote our brand through word of mouth referrals, print and radio advertisements, distributing leaflets in the nearby areas and in-store promotional activities,” says Singh.