The Hindu Business Line : KB’s Fair Price to focus on own brands to build biz

Mumbai, Jan. 22 Kishore Biyani-promoted KB’s Fair Price stores would depend on Pantaloon Retail’s private labels to build its business.“Our vision is to make our own brands more prominent at our stores. Going forward, 60 per cent of the brands would be our own,” says Mr Saurabh Chadha, Head, KB’s Fair Price. From FMCG private labels such as Tasty Treat and Fresh & Pure to durable brands such as Koryo, KB’s Fair Price outlets will focus on ‘own’ brands to fulfil the daily essential needs of their consumers based on the discount-led model.

At the same time, the private labels being stocked at Pantaloon Retail’s other formats such as Food Bazaar and Big Bazaar would have a 5-15 per cent price differential compared to KB’s Fair Price. Adds Mr Chadha, “We would be cheaper by 5-15 per cent than the private labels at Food Bazaar.”

Currently, KB’s Fair Price exists as a division of Pantaloon Food Product (India) Ltd (PFPIL), a subsidiary company of Pantaloon Retail India Pvt Ltd (PRIL).

Competing with the kirana stores primarily, KB’s Fair Price targets residential areas in cities offering a range of daily essentials with limited SKUs. “Unlike Food Bazaar which sells a larger range, we sell only essentials ranging from food products to apparel. No perishable items are sold at our stores,” says Mr Chadha, in whose stores products have discounts ranging from 8 to 20 per cent.

The staples division of Pantaloon Food Product looks after the sourcing and backward integration needs of PRIL’s other formats, including KB’s Fair Price. “We have commodity trading and do the sourcing and backward integration for the retail formats through the staples division of Pantaloon Food Product,” says Mr Chadha. Having launched 26 outlets in Delhi and another three in Mumbai, KB’s Fair Price outlets will now be visible in Bangalore and Hyderabad. “We manage our cost model by not providing air-conditioning and plastic bags for customers,” adds Mr Chadha. KB’s Fair Price outlets expect to break even in operations at the national level in the next 6-8 months. Going forward, PFPIL would be roped in once the cash-and-carry operations are started by the Future Group. “As we are already involved with commodity trading, the same company would provide the expertise as and when the cash-and-carry formats get launched,” says Mr Chadha.