Vishal Retail is working on a new distribution model to bring down costs and increase efficiencies.
Ambeek Khemka, group president, Vishal Retail Ltd said, “We are working on a plan to take our private labels to other retails stores. It is still in the drawing board stage. Also, to bring down the costs we will be outsourcing our distribution to third party players. The model is currently being reworked.”
The retail major is betting big on private labels. According to Khemka, brand consciousness is evaporating with people looking for more value in their buys. The company is witnessing strong growth in fast moving consumer goods, both food and non-food categories. It has introduced what it calls ‘Ration Card’ for consumers to buy monthly grocery and avail more offers on the in-house products.
The margins in private labels are en extra 10-25% compared with what the retailers get from brand manufacturers.
They can also sell it for 20-50% cheaper than the branded products, which give them an edge in times when people are looking to cut expenses.
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