Radhakrishna Foodland Private Ltd (RKFPL), part of the Radhakrishna Group, which boasts of 32 `Foodland? food and grocery stores nationally, is now planning to foray into the private labels segment in October 2007. As part of the strategy, the company will be extending its staple foods category to also include non-food items and general merchandise. Private labels at Foodland will boast of three different categories with differentiation in price points such as Foodland Finest in ?best? category targeted at premium end of the market and Foodland Value in ?better? category at the middle end of the market. RKFPL is yet to decide the private label name to cater to the ?good? category targeted at the lower-end of the market.
Purvin Patel, chief operating officer, RKFPL said, ?For our private labels, we will start sourcing dal from Wasad in Gujarat, tea from Kerala and many other products from various regions. However, one of the biggest challenges for us is to reduce the turnaround time for selling certain items at the store which are not often picked up by consumers. Hence, we will focus at rationalisation of product purchase at various levels. Once we start selling huge volumes of private labeled products, our stores will mostly be franchisee operated as part of our expansion plans for Foodland stores from 23 to over 200 in the next three years.?
According to industry experts, private labels business are less than 5% of the overall retail business and still have a long way to go. But Indian retail is booming as it offers a proposition that can?t be seen anywhere else in the world. In the next 20 years, private labels will have a huge role to play.