When we spoke to Reliance officials, they too confirmed that Reliance petrol pumps were “not feasible as Reliance has a consolidated business.” Therefore, as RPL feels, it made perfect strategic sense for Reliance to bow out of the petrol retailing game. However, it’s not really all goodbye for RPL’s dreams yet as some industry experts believe that its Jamnagar refinery (scheduled to open in September 2008) would soon end bad days for rpl and might even prompt it to make a comeback on the retail front. However Rohit Nagraj, Oil Analyst, Angel Broking has a different viewpoint, “The plant will not be a great help. Moreover with high retail price for petrol here to stay, an incompetitve market is no place for RPL. So, moving out was a great option and they should not think of coming back...” Where almost all entry strategies in retail have failed there’s just one thing that can help it bounce back – innovation! So is the company oblivious of this truth? Well, not really as Bijou Kurien, President & CEO, Lifestyle Reliance Retail expresses, “It is just a starting point and you can expect many more formats in the retail sector from the company.” ‘If not in India, then why not elsewhere?’ is also what you might be wondering. Well for the uninitiated, the company is exploring opportunities on foreign soil in the near future.
Then there is also realisation from the company’s end that middlemen (something that Reliance were planning to get rid of with time) are indispensable in the face of growing competition - learning from its mistakes as you might count it as. Lastly, the company is also belligerent about its hypermarkets, the count of which is forecasted to touch a massive 500 by December 2010. Till date the company has three hypermarkets (one each in Ahmedabad, Jamnagar & Tirupati) & plans to open two more in Hyderabad & Bangalore shortly.
Surely, Mukesh is down but not out and his dreams? Well, his vision spans far beyond just petrol and fresh vegetables; and most importantly, he never runs out of ‘fresh’ ideas!
Pawan Chabra
For more articles, Click on IIPM Article.
Source : IIPM Editorial, 2008
An Initiative of IIPM, Malay Chaudhuri and Arindam Chaudhuri (Renowned Management Guru and Economist).
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