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Indiabulls has renamed Piramyd Retails’
Trumart stores as Indiabulls Mart and
Indiabulls Megastore. |
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| This
follows the acquisition of Piramyd
Retail by Indiabulls Wholesale Services,
the retail arm of Indiabulls Real
Estate, in December 2007. |
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Indiabulls is also re-launching these
stores to win customers and improve
margins by strengthening the supply
chain and relationships with vendors.
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| ‘’The
stores are being redone in terms of what
they sell, how they sell, and the
user-experience,’’ said a senior group
executive. |
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| Piramyd
has 35 neighbourhood convenience stores
and seven lifestyle stores largely in
the western. |
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Indiabulls is trying to leverage its
relationships with suppliers to offer
good deals at its convenience stores and
win customers. ‘’We are trying to
re-introduce the customers to Indiabulls
Mart,’’ said Ikroop Singh, CEO,
Indiabulls Wholesale Services.
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| This was
necessary as a study conducted few weeks
after it took over Trumart found that
customers perceived these to be ‘’MRP
stores’’ (goods sold at the maximum
retail prices) and customers don’t often
find the stuff they want. |
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| When
organised retailers were harping on
price, Piramyd was not able to provide
extra savings to customers as its
business was not growing fast enough.
Piramyd had initially planned to roll
out 128 Trumart stores by 2010.
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“Customers started equating it with
kirana (neighbourhood grocery) stores’’
said an analyst tracking retail sector.
Inability to scale up also meant that
the chain could not attract the right
margins from suppliers. |
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Retailers who buy from distributors
operate on 8 per cent margin while
organised retailers who sell bigger
volumes command 10-12 per cent margin,
which can go up to 18-20 per cent in
some categories. Piramyd’s bargaining
power with suppliers also suffered when
it was talking to prospective suitors in
the last six months. |
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| The
retail arm of Indiabulls Real Estate is
setting up 30 hypermarkets in tier-II
cities such as Jaipur and Ahmedabad, and
has already procured land in 21 of the
30 cities. |
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| It is
also strengthening supply chains by
implementing SAP and ensuring that all
its formats (hypermarkets, lifestyle and
convenience stores) are on same
technology platform. |
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| The
company also plans to ramp up the number
of convenience stores from 35 to 50 by
March and also plans to open a few
lifestyle stores. Indiabulls acquired 84
cent stake in Piramyd Retail in December
for Rs 175 crore. |
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| Shares
of Piramyd Retail have more than doubled
to Rs 199.75 on the BSE after it was
acquired by Indiabulls. They had fallen
to an all-time low of Rs 49 on August
24.
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