Delayed funding and slump in business sentiments due to the Covid pandemic have derailed Future Retail’s plans to roll out 7-Eleven stores in India also.
Future 7-India Convenience Limited, which owns the master franchise of 7-Eleven, reported a net loss of ₹9.61 crore in FY20, according to the company’s annual report.
“During the year FY20 under review, there was no income from operations and incurred a net loss of ₹9.61 crore,” Future Retail said in the annual report.
A source said that despite no business at all, the subsidiary has incurred losses because it had started to hire people and incurred expenses in terms of lease rentals.
Kishore Biyani-led Future Retail had in February 2019 signed a master franchise agreement with 7-Eleven Inc. The company planned to develop, maintain, and run convenience stores and commercial establishments of similar nature to the 7-Eleven stores globally.
In December 2019, Future Retailannounced that it planned to open its first 7-Eleven store in Mumbai in March 2020. Kishore Biyani had said that he saw a lot of opportunity in Mumbai alone. “There will be a cluster of 7-Eleven stores in Mumbai. Only in Mumbai, we can set up over 1,000 stores. I don't think we would be able to do anything beyond Mumbai for another two-three years,” Biyani had said then, on the sidelines of an event.
Covid impact
However, as BusinessLine reported in April 2020, the Covid-19 pandemic stalled those plans. To top it, Future Retail’s core retail business also got impacted badly as it struggled to find capital to stay afloat.