Arambagh’s Foodmart Pvt Ltd
Armed in a major in Mathematics, Masters in Operations Research and Computer Applications, and Business Law, and an MBA in Strategy and Leadership, Biyas Roy is more than well placed to lead the operations of Kolkata-based FMCG retail chain Arambagh’s Foodmart Pvt. Ltd.
Roy has been with the Arambagh Hatcheries Ltd business for a decade, starting out as a senior manager in Corporate Affairs in 2005. Her current assignment – as Executive Director of Arambagh’s Foodmart – began in 2012.
Arambagh’s Foodmart was launched in the year 2000, modeled on the 7-11 international convenience store chain, and as an experiment to add more value for the customers of the existing “Arambagh’s Chicken” chain of stores selling processed and ready-to-eat chicken items.
By 2012, the division was incorporated into a separate company — Arambagh’s Foodmart Pvt Ltd – which now operates small format FMCG convenience stores, of an average size of 600-1000 sqft area. The chain has now expanded to 36 stores, of which 26 are in Kolkata and 10 in other cities of West Bengal. In 2013, the company also initiated B2B and institutional sales.
“Ärambagh’s Foodmart” is a unique format which positions itself between the neighborhood kirana store and the supermarket offering modern ambience and attractive promotions,” Roy says. “The USPs are developed around ‘Value for Time’ as well as money. Instead of the usual path trodden by retailers providing the ‘luxury and experience of shopping’, we provide the convenience of grocery shopping by quick reach, quick checkout, telephonic order and home delivery, while ensuring quality and promotion at par with modern trade market.”
This approach works because the small format stores typically have high footfall density and high per sq.ft sales, Roy adds.
According to Roy, the key aspects of operations that have delivered profitability for Arambagh’s Foodmart are: Quick Inventory turn; Low inventory level, JIT for private labels; Volume discount from vendors for bulk purchase at central warehouse; Fully integrated software system to capture sale and purchase and production and real time data analysis for business decisions; and a strong private label mix.
“FMCG retail is a tough category to be in; you always need to keep your eye on the ball,” Roy says, while pointing out that the very challenge of operating a no-margin-for-error business is what keeps her energised and motivated.
Her biggest professional challenge? “Rising rental costs and overheads, along with the lack of control over product pricing,” she answers, echoing the sentiments of virtually every grocery retailer in India.
As a solution to the latter challenge – lack of control on retail pricing – she suggests that Indian retailers form a unified platform to “achieve greater bargaining power over brand owners”.
Finally, the question that must be asked: how does she view the digitisation of retail? “The ecommerce universe has to grow, because it is driven by convenience. In today’s age, quality and convenience rank above price and promotion for consumers,” Roy responds. But it’s not for Arambagh yet, she qualifies. “It is a different business model; it is a warehousing-based structure that we are currently not exploring, quite frankly. We have our hands full in delivering great products and experiences to our customers, and profitability for our business.”
By Nupur Chakraborty