The Tata group seems to have upped the ante in the organised retail space. Infiniti Retail, a 100-per cent subsidiary of Tata Sons, is mulling to extend the tie-up with Woolworths with which it has a cash-and-carry arrangement for the consumer durable business.
"We have an open mind on expanding our tie-up with Woolworths and we would like to extend it to all 12 different formats that they operate in Australia and New Zealand," Ajit Joshi, CEO, Infiniti Retail said.
Woolworths operates retail formats as varied as supermarkets, convenience stores, liquor, petrol, general merchanidise and consumer electronics, among others. However, the main challenge before the Tatas now is to widen the Croma (multibrand stores of Infiniti Retail) footprint across India.
The group, which unveiled the first Croma store in October last year at Juhu, is in the middle of an expansion spree. It has planned to take the number of Croma stores to 40 by the end of this calendar and 100 plus by 2010. At present, it has three stores in Mumbai, two in Ahmedabad and one in Navi Mumbai.
To expand the business with Woolworths, Infiniti Retail is going hammer and tongs in booking floor space at different locations in the country. It is looking at properties in the range of 10,000-15,000 sq feet and is talking to builders like Nirmal Life, Hiranandani and Prestige Developers. Joshi said that while the company is not averse to outright purchase of properties if it finds these suitable, the properties that have already been signed in cities like Bangalore, Delhi, Kolkata, Chennai and Hyderabad will be on a lease basis.
Considering that a typical Croma store, with a floor space of around 15,000 sq feet, costs about Rs3 crore and another Rs6 crore goes for inventories, the proposed roll-out will have an investment of over Rs300 crore.
"There are many positive triggers now. A fantastic growth coupled with a good monsoon will sure propel the organised retail growth which is currently growing at a clip of 10 per cent," Joshi said.
The group has a back-end tie-up with Woolworths that does the entire sourcing for the company and has three distribution centres. Alongside the ongoing expansion of Croma, the company is also exploring possibilities of entering other formats although it is yet to coin a name for its upcoming ventures.