Making of a Mega Basket as Spencer's Retail Acquires Nature's Basket
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It was a marriage waiting to happen. Goenka Group’s Spencer’s Retail basked under family business leadership (156 stores across 50 cities with revenues of Rs 2,187.2 crore in FY19), whereas Nature’s Basket, which was not the core business for Godrej Group (35 stores across 3 cities with revenues of Rs 338.28 crore in FY19) had a different story. The Rs 300-crore acquisition is expected to add muscle to Spencer’s Retail in the western India market.
- 1897: Spencer’s & Co became a public limited company with 403 shareholders. Eugene Phillip Oakshott was the first chairman.
- 1889: RPG Enterprises buys major stock in Spencer. Sanjiv Goenka was appointed as the chairman.
- 1995: Spencer’s enters into a technology assistance pact with Dairy Farm International Holdings, Hong Kong, to operate the 'Foodworld’ chain of supermarkets.
- 2005:Godrej changes its focus from heavyweight consumer products to everyday food consumption products and launches Nature’s Basket with its first store in Mumbai.
- 2006:Joint venture with Dairy Farm was terminated and the first new store under the Spencer’s brand name was inaugurated in West Mambalam, Chennai.
- 2007: Spencer’s changed its brand positioning from 'Smart Ways to Shop’ to ‘Taste the World’ and introduced first Private label brand ‘Smart Choice’.
- 2008:Spencer’s opened its largest store in India in Kolkata with over 72,000 sq. ft. The company tied up with Woolworths, UK, for retailing toy brand, Chad Valley, and Ladybird brand of their kids wear. It stitched its first global tie-up in fashion by aligning with Beverly Hills Polo Club.
- 2009: Spinning off Nature’s Basket from Godrej Group, Mohit Khattar, ex-president, Subhiksha was appointed as Managing Director and CEO of the separate entity – Nature’s Basket, while Tanya Dubash, daughter of Adi Godrej, remained on the board.
- 2010: Spencer announced the change in brand positioning from 'Taste-the-World’ to ‘Makes Fine Living Affordable’. It introduced Spencer’s ‘Smart Rewards’ loyalty programme for shoppers and a private label brand ‘Clean Home’ and ‘Tasty Wonders’.
- 2013: Shashwat Goenka, son of Sanjiv Goenka, joins Spencer’s business as Sector Head of Retail & FMCG.
“Nature’s Basket has a strong e-commerce presence, and we believe that fits in well with our omni channel strategy at Spencer’s.” Shashwat Goenka, Sector Head of Retail & FMCG, RP Sanjiv Goenka Group"
- 2015: Spencer acquired 100 per cent stake in Meragrocer.com to foray into the online grocery segment, giving the merger an omni-channel presence. With a merchandise value of Rs 5 crore, Meragrocer. com operated in Delhi and Gurugram.
- 2015: Nature’s Basket acquired online grocery platform Ekstop.com for around Rs 30-40 crore. The acquisition led Nature’s Basket to tap the online demand for grocery products via its website, mobile-based app and through Amazon and Snapdeal. The development allowed it to keep 5000 SKUs across 3,100 pin codes pan-India.
- 2016: Under the supervision of Shashwat Goenka, the company’s EBITDA loss reduced to Rs 30 crore from Rs 300 crore a few years ago.
- 2016: Nature’s Basket appointed Avani Davda as Managing Director and announced Refresh 2020 strategy to generate Rs 1,000 crore revenues by 2020.
- 2017: The brand made a 180° turnaround from being a 'World Food Store’ to being a ‘Daily Food Delights’ store, focusing on being a fresh quality neighbourhood store. The products such as Spanish Toast Ham, Parmigiano Reggiano Cheese were redesigned and Avani Davda closed eight underperforming stores in Delhi.
- 2018: Nature’s Basket acquired a minority stake in Goa-based grocery chain - Magsons Group. It embarked on an aggressive expansion in Tier I and II cities. The company reduced SKUs from 30,000 to 7,000, focusing more on everyday items of consumption, be it grocery, tea, fruits or vegetables. Company’s loss narrowed in FY18 as it reported a net loss of Rs 62.24 crore, down from Rs 95.37 crore, from previous year.
- 2018: Spencer turned profitable for the first time ever. The company announced profit of Rs 7 crore in FY 2017-18 and they revamped their online business by adding new features and product range which saw about 60,000 orders coming through.
- January 2019: Spencer’s Retail gets listed as a separate entity in the stock market after demerger with its flagship brand, Calcutta Electric Supply Corporation (CESC).
- May 2019: RPG’s Spencer acquired Godrej’s Nature’s Basket. “We need to pass on the torch to owners who have the relevant ecosystems to take the business to the next level,” says Tanya Dubash, ED and Chief Brand Officer, Godrej Group.
(This article was first published in the July 2019 issue of Entrepreneur Magazine. To subscribe, click here)