 "Spencer's Retail acquires e-commerce grocery start-up Omnipresent Retail")
With a view to tap the niche online grocery market, Spencer's Retail Limited has acquired a 100 per cent stake in Gurgaon-based start-up, Omnipresent Retail, which runs operations under the brand name Meragrocer.com. The company will be incorporated as a subsidiary of Spencer's Retail.
Starting from scratch, Spencer's expects online grocery sales to be close to Rs 500 crore in the next three years. The company will roll out its online grocery operations in Kolkata in the first quarter of the next financial year. At present, Meragrocer.com operates in Delhi and Gurgaon regions, with an annual turnover of close to Rs 5 crore.
Spencer's did not disclose the valuation of the deal. "The cost of acquiring the business has been significantly lower than the what it would have been cost of developing a greenfield set-up," said Shashwat Goenka, Sector Head-Spencer's Retail.
Last financial year, Spencer's Retail had a total sales of close to Rs 1900 crore, and this year the company expects nearly 10-15 per cent growth in sales.
The acquisition is also a step towards Spencer's long-term listing plan as it will help the company to reach a break-even point at a faster pace, said Goenka. Loss at Spencer's Retail was down to an average of Rs 2 crore per month in the second quarter of the present financial year as compared to about Rs 9.5 crore per month five years back.
Online grocery sales at present accounts for less than one per cent of total grocery retail sales.
Spencer's plans to add three new hypermarkets in the fourth quarter and approximately 85,000 sq feet of space, to its existing 15 lakh square feet of space. Currently Spencer's attract every month 3.7 million footfalls.
Meragrocer.com has been in operations from the end of 2014, and its customers can order through a mobile-app, IVR, and pay either through an e-wallet or cash-on-delivery. Spencer's expects to complete the acquisition and integration process in the next one or two month. At present there are close to 20 employees, all of whom will be absorbed in Spencer's.
