Home Fashion products Reliance launches an offensive against HUL, Nestlé, P&G; plans to establish a vast FMCG company

Reliance launches an offensive against HUL, Nestlé, P&G; plans to establish a vast FMCG company

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The country’s largest company, with more than $100 billion in annual sales, is poised to take on foreign multinationals head-on in the consumer goods market. Reliance Industries, which already owns India’s largest retail chain and is armed with more than two dozen private label brands, plans to rapidly expand its consumer staples business by acquiring more than 50 brands.

According to sources, the conglomerate led by billionaire Mukesh Ambani is targeting the vast consumer goods market which has been dominated mainly by US and European multinationals such as Procter & Gamble, Unilever, Nestlé, Reckitt Benckiser, L’Oréal and Colgate- Palmolive, among others, for almost a century. In its attempt to claim a stake in the country’s nearly Rs 7,500,000 crore consumer goods and retail market – the third largest in the world – Reliance has set aside Rs 50,000 crore for the acquisition.

Reliance’s consumer goods interests are not new. Over the past decade, the group has strengthened its presence in the organized retail space through its two subsidiaries Reliance Retail Ltd (RRL) and Reliance Strategic Business Ventures Ltd (RSBVL). As RRL has expanded its retail footprint to over 15,000 brick-and-mortar outlets, developed multiple digital properties such as Ajio, and stepped up omnichannel gaming, RSBVL has been the arm for making strategic investments and acquisitions.

Over the past few years, the group has actively added new brands and expanded its consumer goods portfolio into packaged food and beverages, personal and household care, and fashion, durable consumer goods and apparel. Its foray into the growing branded F&B space through house brands such as Snactac (range of snacks, cookies, instant noodles, etc.), Goodlike (pulses, rice and edible oil), Yeah and Desi Kitchen (mixes instants, flours, pickles and mixed masalas) took aim at management.

Netplay (formal office wear), Performax (specialty athletic wear), Fusion (fusion wear for women), AVAASA (ethnic wear for women) and Rio (fashion wear for active women) led to its rise in the fashion and clothing space. It has also partnered with at least 47 top global brands like Armani Exchange, Diesel, Gas, Hamleys, Hugo Boss, Marks & Spencers, Steve Madden, Tiffany & Co over the past few years.

Plus, a bunch of acquisitions helped it grow its presence quickly. In fiscal 2021-22 alone, the group acquired or invested in fashion brands like Abu Jani Sandeep Khosla, Abraham & Thakore, ak-ok, Rahul Mishra and women’s intimates brand Clovia.

According to company management, it is focused on developing “its own portfolio of brands in categories such as health and immunity boosting foods in grocery stores, and appliances and productivity devices in electronics. General public”. Additionally, the group is “developing a portfolio of own brands for new commerce” with an eye on “exclusive brand licensing and own brand products through Reconnect, JioPhone and LYF,” it said in its report. annual. In fiscal 2021, Reliance Retail earned over 75% of its revenue under its fashion and apparel chain Reliance Trends from its “own brands”. While for (Reliance) Trends Footwear, the private label contribution was over 60%.

In fiscal 2021-22, Reliance added 75 new warehouses and distribution centers to support its growing retail and consumer goods footprint. The fashion and apparel segment saw revenue jump 55%, launched 750 brands and strengthened its presence in small towns. In consumer electronics and durable goods, it not only owns one of the largest retail chains – Reliance Digital – but also offers in-house products through private labels such as Reconnect, resQ, Kelvinator and GLP. In fiscal year 22 from January to March, it recorded 50% sequential growth in the festive quarter. “Merchant partners across the country, including small towns, offering a wide assortment of electronics and appliances in all categories” were in full swing, the company said.

Its preparations for an all-out invasion into the consumer goods space have been underway for a few quarters. In FY22, to bolster its workforce, Reliance Retail recruited more than 150,000 new employees, bringing the total workforce to 361,000. “In line with rapid expansion, a high proportion of these jobs will be in non-metro, Tier 2 and 3 cities and beyond, where the company is rapidly expanding its network of physical stores as well as digital and new commerce platforms,” it said.

Also read: Dependence to Acquire Dozens of Brands in $6.5 Billion Consumer Goods Game: Report

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