The Hindu Business Line : Spencer’s Retail marginally affected by inflation

RPG Enterprises’ Spencer’s Retail will add 100 small-format convenience stores and 20 hypermarkets in the financial year 2008-09, said Mr Nimish Shah, Vice-President (West zone).

Speaking with presspersons on the sidelines of the Food Forum of India 2008, he said around Rs 10 crore was required to set up a typical Spencer’s hypermarket of 20,000 sq ft trading area, while Rs 4 crore would be required for a small store. The proposed expansion would be funded through internal accruals, he added. Currently, Spencer’s operates 400 convenience stores and 15 hypermarkets. The supermarket chain follows the cluster approach. Its new stores would come up around hypermarkets in tier-1, 2 and 3 cities including Nasik, Nagpur, Surat, Indore and Kolkata. The company’s distribution centres, set up and managed by them, would also be strategically located around the clusters. The recent rise in food prices affected the retailer marginally. He added that Spencer’s did not see much of an impact on sales when the prices rose and also when some commodity prices, like oil, decreased, later on.

City consumers

“It will be wrong if I say that we were not affected at all by the rising prices; our sales were marginally affected by inflation. The reason for this is that our customers are basically city-bred urbanites and slight fluctuations in the prices do not increase or decrease their consumption,” he said.

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