Savemax retail welcomes competition, FDI

The value format retail chain, which offers products at wholesale prices and also offers live bakery and better aisle space, is planning to open 50 stores in North India. Vaibhav Singhal, Founder and Director, Savemax shared his vision with Ankur Gaurav.

Ankur Gaurav: How is Savemax different from other modern retail outlets?

Vaibhav Singhal: Unlike other modern retail outlets, we focus on customer engagement and offer the facility of live bakery, food court, large parking and bigger aisle spaces - double the aisle spaces you can normally find in other stores. The consumer will not find a hustle while shopping and will go back with delight.

AG: How are you promising to offer better prices to the customers?

VS: We are following a model called wholesale-club format. It’s a volume game. People will love the store and eventually become a permanent customer. Instead buying one product, they prefer to pick pack of three or five. Larger consumption allows us to deliver products at a wholesale rate. Consumers do not mind buying extra if getting at a better value for money. This would help us to get higher share of wallet.

AG: What was the homework you have done before opening this?

VS: We have been in touch with customers. After talking to around 300 customers, we realized the gaps and planned to bridge these gaps with our offerings. That is how live bakery and food court was developed in the store.

AG: What is the number of SKUs you offer?

VS: We offer one-third SKUs offered normally. The number would be around 5,000 and the idea is lesser the SKUs but each product comes across the vision of customers eyes. We have all the categories with top brands. This way the inventory is not getting stuck. Brands are happy getting larger space and capturing more eye balls.

AG: You also have your own labels at your store. Tell me something about them.

VS: We do have our own label with the name ‘Purani Dilli’ under which we offer pulses, dry fruits, rice, sugar and grocery.

AG: What is the expansion plan for Savemax?

VS: There are three stores as of now. Our target is North India. We are planning to open 40 to 50 stores in the next three years. Moradabad will be opening shortly. It all depends on getting good property sites. And in Delhi we plan 6 to 7 stores. The store area must be around 30,000-50,000 square feet. Expansion will not follow franchisee format and we want to open company-owned stores.

AG: What is your take on Competition and FDI in retail?

VS: Competition is always welcome. Competition could be any one. Market will evolve because of it and Mom and Pop stores are not going anywhere. They would exist. We as retailers do not see FDI having much of an impact on us.