Tata Group to acquire GrocerMax

The Tata Group is buying out the management team and technology infrastructure of Gurgaon based GrocerMax to enter the online grocery business as consumers increasingly place orders for their supplies over the internet.

The new team will help set up the online platform for Trent Hypermarket, an equal joint venture between Tata and British retailer Tesco that will rival Amazon and Bigbasket in the nascent yet rapidly growing segment. GrocerMax will shut down its business in Gurgaon because the Tata group's grocery business is not present in North India. The Tata Group runs three formats under the Star Banner – Dailies, Market and Hyper and has around 42 stores.

For Tesco, the world’s third largest retailer has nearly 6,800 stores globally, its online business earns roughly 3 Billion in sales and is one of the rare such ventures that’s profitable. But the opportunity offered by the $500 Billion retail market is attractive for any player, foreign or local. Food and grocery account for almost 50% of the overall retail basket in India, although general merchandise, personal and home products fill up a bulk of the retailer’s profit pool.

Experts feel omnichannel retail offers consumers more ways to shop and interact with a retailer. GrocerMax is a hybrid platform for grocery that keeps only 10% inventory, sourcing the rest from supermarkets and provisional stores in real time. The online grocery space in India, which has seen a minor shakeout over the past year, has attracted more players as well. While LocalBanya and PepperTap suspended operations, Grofers shut in multiple cities.

Carrefour exits India

Carrefour is a French multinational retailer headquartered in France. It is one of the largest hypermarket chains in the world. It operates mainly in Europe, Argentina, Brazil, China, UAE, and Saudi Arabia. Carrefour operates cash and carry stores in India under the name “Carrefour Wholesale Cash & Carry.” The first store opened on December 2010 in Delhi. Then it was followed by a store in Jaipur, Meerut, Agra, and Bangalore.

Before September 2012, the FDI policy in India did not allow foreign companies to open multi-brand store. However, 100% FDI in cash and carry was permitted. As a result, Carrefour opted for cash and carry route to establish their presence in India. In September 2012, the new FDI policy allowing up to 51% FDI in multi-brand retail was introduced which would benefit Indian Farmers and consumers positively in long run.

Recently, France largest retail store Carrefour will shut its Indian operations and close its wholesale stores in the country. Carrefour will exit from underperforming markets including Singapore, Malaysia, and Greece. Company will now focus on their key markets in China, Brazil, and Europe. There are no reasons known of shutting stores in India but it was said in May that company is working on ways to withdraw from India after an eventual BJP victory. Company’s five stores lose business of $17 million in 2012.

Wal-Mart, the world’s largest retailer, had last year shelved its plans to open a retail store in the country. Wal-Mart is now focusing on opening wholesale stores in the country and recently launched an e-commerce venture in India. Following the Indian government’s decision to allow foreign companies to own a 51 percent stake in multi-brand retail segment, only British supermarket operator Tesco has announced its plans to open stores in the country. Reliance Retail and Bharti Enterprises are in talks to buy India assets and readymade cash and carry stores of world second largest retailer Carrefour.