E-commerce giant Amazon signed a deal with Kishore Biyani’s Future Group, giving the online retailer a head start in the race to capture retail market in India. The announcement comes just days after Mukesh Ambani revealed his plans to sell food and groceries through Reliance’s JioMart.
The deal will combine the Future Group’s offline and Amazon’s online presence to deliver food, groceries, general merchandise, personal care products, and fashion and footwear within two hours in Dehli, Mumbai, Bengaluru and Hyderabad.
"This arrangement will allow us to build upon each other's strengths in the physical and digital space so that customers benefit from the best services, products, assortment and price," Kishore Biyani, Chairman and Managing Director, Future Retail Ltd. said in a statement.
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Future Group’s Big Bazaar and Foodhall will soon be listed on Amazon India’s marketplace, and the partnership has already launched online sales from 22 stores of Future retail.
"We are excited about the business collaboration with Future Retail Ltd (FRL). FRL's national footprint of stores offering thousands of products across fashion, appliances, home, kitchen and grocery will now be available to millions of customers shopping on Amazon.in, in hours across 25+ cities," Amit Agarwal, SVP & Country Head, Amazon India said in a statement.
Tying-up with Future Group could give a heft to Amazon’s online retail plans in India as FRL’s customer base of about 350 million footfalls across its retail network may soon be on the e-commerce giant’s growing list of online shoppers.
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Online retail
According to a 2019 Jefferies report on online retail, individual shoppers will double their online spending to Rs. 25,138, from Rs. 12,800, by 2030. It also noted that shopping online will grow annually at 23% to $170 billion in ten years. During this period, online retail as a percentage of total organised retail market in India will jump to 37% from 25% in 2019.
This market and the unorganised retail market are driving Mr. Ambani’s retail ambitions. JioMart is currently available to customers in some part of Mumbai.
In August, Mr. Ambani told shareholders that his tech-enabled partnership will link producers, traders, small merchants, consumer brands and consumers. And now, he is bringing JioMart to showcase his experience with new commerce.
While Reliance’s JioMart executes its plan to transform 90% of the unorganised retail market, Amazon will deploy its experience from running Whole Foods for over two years now. During this time, Amazon has broadened shopping options and selectively discounted prices, and has effectively handled delivery of perishable products.
The partnership with Future Group will give an additional lift with Big Bazaar, EasyDay and Heritage Fresh.