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Reliance Retail Launches Hyperlocal Delivery in Mumbai and Navi Mumbai

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Published Date: 27 Jun 2024Updated Date: 31 Dec 20246 mins readBy MOFSL

Reliance Retail, a subsidiary of Reliance Industries Limited and a powerhouse in India's retail sector, is making waves with its innovative approach to hyperlocal delivery. Founded in 2006, Reliance Retail has established a formidable presence across the nation with a diverse portfolio of retail formats, including grocery stores such as Reliance Fresh and Reliance Smart, electronics outlets like Reliance Digital, and fashion brands like Reliance Trends and AJIO. In a strategic move to enhance customer convenience and tap into the burgeoning quick commerce market, Reliance Retail has launched a pilot program for the immediate delivery of groceries and fast-moving consumer goods (FMCG) in select areas of Mumbai and Navi Mumbai. This initiative aims to fulfill orders within an hour, significantly improving on the current delivery times which range from 12 hours to three days.

The new service is seamlessly integrated into the JioMart mobile application under the ‘hyperlocal delivery’ option. As Reliance Retail links more stores to this system, it aims to reduce delivery times further, targeting a window of 30-45 minutes. This initiative represents the first phase of Reliance's broader quick delivery strategy, which will eventually expand to cover the entire country. Initially, the focus will be on the top eight metropolitan areas, with plans to extend to the top 20-30 cities. To support this ambitious rollout, Reliance Retail is not only increasing its delivery workforce but also partnering with Grab, a third-party electric vehicle (EV) bike logistics provider, to ensure timely deliveries within the promised 30-minute timeframe. Unlike its competitors, which rely heavily on dark stores and a vast fleet of delivery personnel, Reliance Retail plans to leverage its extensive existing store network and warehouses to efficiently fulfill orders. 

Financially, Reliance Retail has demonstrated robust performance. In the January-March quarter of FY24 (Q4FY24), the company reported significant growth, with its seller base expanding by 94% year-on-year and live selection increasing by 32% year-on-year. The fiscal year closed with Reliance Retail operating 188,361 stores across various formats and categories, attracting footfalls of 1,063 million. The group’s gross revenue for FY24 exceeded Rs 3 trillion, marking a 17.8% growth compared to the previous year, and earnings before interest, tax, depreciation, and amortization (EBITDA) reached Rs 23,040 crore, up by 28.5% year-on-year.

The competitive landscape of the Indian quick commerce industry is intensifying. The industry’s gross merchandise value increased by 77% year-on-year to $2.8 billion in 2023, with key players like Zepto, Zomato, Swiggy, and BigBasket vying for market share. Walmart-owned Flipkart is also gearing up to launch similar services in Delhi, Bengaluru, and Mumbai after unsuccessful attempts to acquire a majority stake in Zepto. Zepto, a notable competitor, recently raised $665 million from investors, bringing its valuation to $3.6 billion, and is seeking an additional $400 million to potentially reach a $4.6 billion valuation. Zepto plans to double its dark store count to 700 by March 2025. The company has seen its gross merchandise value exceed $1 billion, with 75% of its stores achieving full EBITDA positivity by May 2024. Zepto also aims to move its base to India and go public by 2026. In FY23, Zepto’s revenue surged 14.3 times to INR 2,024.3 crore, though its net loss also increased 3.4 times to INR 1,272.4 crore.

All-in-all, Reliance Retail's pilot delivery service in Mumbai and Navi Mumbai signifies a major leap towards transforming the hyperlocal delivery landscape in India. By leveraging its extensive store network and integrating advanced logistics solutions, Reliance Retail aims to offer unparalleled convenience to its customers. With its strategic approach and strong financial performance, Reliance is well-positioned to lead the market in delivering fast and reliable services, even as competition in the quick commerce industry heats up.

 

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