Godrej Nature's Basket targets Rs 1,000 cr turnover by FY20; will tap regional retail chains to expand footprint
Godrej Nature's Basket hopes to close the current financial year with a Rs 500 crore turnover.
In line with its strategy to focus on partnerships with regional retail chains to expand in Tier 1 and Tier 2 cities, with an asset-light growth model, Godrej Nature's Basket on Thursday announced that it has inked a deal with Goa-based retail chain Magsons Group. Godrej has also picked a minority stake in Magsons.
The Magsons Group is a family-owned grocery chain operating since the 1990s and runs 11 stores across the southern state. Godrej Nature's Basket, a 100 percent subsidiary of Godrej Industries, will work with Magsons on assortment, merchandising and sourcing of products.
"We will leverage their supply chain, and improve their margins in around two years. Based on how the business grows, we have plans for co-branding," Avani Davda, Managing Director, Godrej Nature's Basket, told Firstpost.
Godrej Nature's Basket will look at other regional partnerships, in Chennai, Hyderabad and the NCR, and is already in talks with a few players, Davda said. The firm expects to make announcements on that front in the next 12 months, she added.
"The idea is to go in for collaborations versus acquisitions," said Davda, adding that the company may not look at picking a minority stake in all its partnerships - such a move will be evaluated on a case by case basis. The firm will also focus on the omnichannel, Davda said.
Godrej Nature's Basket has transitioned from being a niche store that was heavily dependent on imported products, to a store that now stocks fruits and vegetables, alongside an array of products categorised in the affordable to premium range.
The store now boasts good-better-best products that are open to a wider clientele. To achieve this, the company has tapped startups in the food sector. That decision led to a 12-15 percent growth in revenues, said Davda.
With a presence through 30 stores across Mumbai, Pune and Bengaluru, the firm aims to increase its footprint to 40 stores (excluding partner stores) and establish the brand as a leading neighbourhood retain chain by financial year 2019.
The minority stake in Magsons will add to the top-line, by some Rs 50 crore, and the company hopes to close the current financial year with a Rs 500 crore turnover. It hopes to close FY20 with a Rs 1,000 crore turnover, and be profit after tax (PAT) positive by 2022.
Last year, the company logged a turnover of Rs 320 crore.
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