A part of Rs 15,500 crore RPG Group, Spencer’s Retail Limited is a multi-format retailer that offers fresh and packaged food, groceries, electronics and electrical equipments, home and office essentials , garments and fashion accessories, toys, and personal care. In March 2009, Spencer’s clocked a turnover of Rs 101 crore; In March 2010, the company expects revenue growth of 8-10 per cent. Currently, Spencer’s Retail has about 250 stores and closed about 150 stores last year. Spencer's, Spencer's Hyper, Beverley Hills Polo Club, Music World and Au Bon Pain are the retail formats existing under Spencer's umbrella.

Growth & Expansion

The company plans to focus on the larger format stores in the identified growth clusters with higher market potential value and stronger brand equity for Spencer’s.

It would also focus on high margin verticals like private label and fashion. Currently, the two verticals independently contribute about 15 per cent to the total revenue of Spencer’s, which is targeted to be enhanced to 30 per cent within next couple of years. New categories and new products in existing categories in the private label portfolio are currently being launched across food, fashion, home and entertainment.

New standalone pilot stores of sub-verticals like fish and meat, gourmet stores will be launched to cater to one stop shop need of the customers. Plan is there to bring in exclusivity for the Spencer’s consumers through exclusive tie-ups with international brands in the apparel segment. Also, the company will customise offerings to cater to the local requirements. While 80 per cent of the merchandise would be common across India, 20 per cent would be local.

Finally, the company is strongly focusing on the cost. The company has successfully implemented a cost rationalisation programme involving consolidation of operations, rationalisation of manning, apart from closure of non-performing stores resulting in the monthly saving of Rs10 crore from April 2009. It has also initiated further steps for rationalisation of its management cost and strengthening the backend system which would drive additional cost efficiency in operations.

Spencer’s Retail will add about 10 more large format stores by March 2010 and equal numbers by March 2011.

Quick Facts

Total number of stores : About 250

Turnover achieved (2008-2009) : Rs 101 crore

Projected revenue growth : 8-10 per cent

“It is still a difficult situation even though we are seeing consumer spends inching back to the previous levels. As indicated earlier, the same store sales are beginning to improve and we still need to innovate to drive top lines upwards.”

Vineet Kapila, President, Spencer’s Retail Limited.