Expect significant growth from Omnichannel, non-food portfolio to enhance profitability, says Spencer’s Retail 

PTI | New Delhi | Updated: 06-07-2022 15:00 IST | Created: 06-07-2022 14:45 IST
Expect significant growth from Omnichannel, non-food portfolio to enhance profitability, says Spencer’s Retail 
Representative Image Image Credit: www.spencersretail.com
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RP-Sanjiv Goenka Group arm Spencer's Retail Ltd expects a ''significant growth'' in its Omni-channel model and investments in its non-food portfolio to enhance profitability, according to the company's annual report.

Spencer's Retail will continue to focus on the e-commerce platform and is ''one of the only retailers at nearly breakeven levels'' online & delivering sustainable business growth both on a QoQ & YoY basis.

''We are witnessing increased demand for our digital retail formats, and we intend to continue investing in our Omni-channel business in the future,'' Chairman Sanjiv Goenka said in his address to the shareholders of the company.

Logistics will play a transformative role in the retail environment, and Spencer's has invested in upgrading warehouse facilities to improve inventory movement efficiency.

''Thereby, expanding our digital reach across the country while achieving an optimal product mix,'' Goenka added.

As a part of its ongoing action plan, the company is focused on a hybrid model of both brick & mortar store and 'OMNI-Channel' distribution, it said.

The company continues to prioritize the expansion of high-margin categories - a non-food sales mix through better assortments and the introduction of SOR (Sales or Return) brands in general merchandise and Apparel.

''Compared to last year, our share of the non-food mix % grew by 185 bps and is gaining momentum,'' he added.

Like other retailers, Spencer's Retail had also worked on our Out-Of-Store business after the pandemic by improving the mobile app, developing chatbots, and creating a time-bound delivery plan to provide a differentiated consumer experience.

''The Omni-Channel model is gaining traction quicker than other retail formats and is expected to continue growing significantly in the future. When compared to the same period of the previous year, our e-commerce business grew by 1.8x GMV in 2021-22,'' Goenka said. ''In FY22, Spencer's Retail's losses were ''reduced and witnessed stable growth in EBITDA, which stood at Rs 101 crore, up by 65.5 percent year-on-year,'' he added.

Its turnover in the last fiscal was at Rs 2,376 crore and operated 154 stores under the brands - Spencer's and Natures Basket. In FY22, Spencer's Retail opened eight stores - four each under Spencer's and Natures Basket's portfolio.

It also rationalized ''some unviable loss-making stores'', Goenka added.

In comparison to pre-pandemic levels, Spencers Retail's omnichannel sales grew 10 times from 1.6 percent to 16.5 percent for the financial year ended on March 31, 2022, said its CEO & Managing Director Devendra Chawla.

''Our Non-Food mix has grown by 185 bps from last year and we are constantly working on various initiatives to increase the share of the Non-food mix,'' he said adding Spencer's is expanding its reach and enhancing its portfolio mix to deliver sustainable value to its stakeholders.

The introduction of various SOR brands in its general merchandise and apparel portfolio, will help to enhance the product portfolio for its customers and is also helping to manage Spencer's Retail working capital requirements, said Chawla.

''Our SOR Sales mix has touched 11 percent for Apparel & General Merchandise,'' he added.

Besides, with the footfalls increasing in the modern retail format, the company remains focused on increasing its physical store presence across the country.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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