New Delhi: One of the richest men in the entire world and the chairman of Reliance Industries Mukesh Ambani said that the new e-commerce venture that he is going to bring up will bring win-win benefits to consumers, producers and retailers. He also stated that Reliance will be launching a unique new commerce platform to empower and enrich our 12 lakh small retailers and shopkeepers in Gujarat.
Ambani stated: “will bring win-win benefits to consumers, retailers and producers. Jio and Reliance Retail will launch a unique new commerce platform to empower and enrich our 12 lakh small retailers and shopkeepers in Gujarat.”
“Reliance has an ecosystem of entertainment, financial services, payment gateway, etc. Once it has customers hooked on to these services, then it is a question of time before it can start offering merchandise as well,” Arvind Singhal, chairman and managing director at retail consultancy firm Technopak told FE Online earlier.
Moreover, unlike Amazon or Walmart, home grown Reliance doesn’t have constraints around restrictions on FDI in e-commerce. This might give it a regulatory edge over existing e-commerce biggies.
“Retail sector operates between 3-5% of profit and Reliance has been able to maintain that profit. Nobody would have thought that they would pull off something like Jio,” said Naresh T Raisinghani, CEO and Executive Director at India division of global consulting firm BMGI.
Reliance’s burn rate for new e-commerce venture is also expected to be lower. With near 300 million Jio customers, it won’t have to spend on acquiring customers, said Singhal. Also, since the company has a strong EBITDA in the physical retail, it can certainly leverage its sourcing, distribution, supply chain, private label etc., he added.