Mukesh Ambani’s Reliance Industries recently purchased Future Group to further strengthen his position in the online and offline retail space. Reliance is planning for a big game and wants to combine both shopping experiences on a single platform. You won’t get more prominent names like Amazon and Walmart in e-commerce and retail. Even though Walmart recently merged with Flipkart, both the retail giants still fall short in understanding the Indian retail/e-com landscape.
So far, the two big contenders have managed to stay strong since they have way more experience in this business and have been around for quite a while. Not to mention, both Amazon and Walmart are financially on much firmer grounds.
Major retail and tech giants have been actively pursuing the Indian retail industry. Some are hailing Reliance’s move as a gamble because the Indian e-commerce and retail market are oversaturated with inexperienced suppliers. They are unsure of how to cope with running their shop online.
Arvind Singhal, Chairman of Technopak Advisors, spoke about Reliance’s upper hand from the Future Group deal and said, Reliance was already much ahead of the competition. This deal has just further strengthened its position in the industry.
The recent $1 billion investment from Salt Lake is a clear indication that Reliance is making steady growth plans to push Reliance Retail biz to pick up on industry players. This is the second investment in Reliance industries subsidiary. Salt Lake invested $1.35 billion in the Jio platform earlier this year. Reliance is trying to become the best of both Amazon and Walmart for Indian retail.
Jio Platforms will act as the unifying platform for Reliance’s online and offline retail business. It is responsible for attracting Walmart’s investment. This is just the tip of the iceberg with more stakes expected to pour in. Many US companies, including Amazon, Walmart, and Zoom, were chalking out plans to take over India’s retail business. However, Reliance pushed forward Jio Platforms and Jio Mart, thus hindering their plans.
Mayank Vishnoi, Resfeber International had this to say about Jio Platforms, The addition of new digital products targeting various sectors will pose threats to many large dominant players. Having strategic partners like Facebook and Google validates that Reliance’s game plan is real.
Reliance’s upper hand against Amazon was solidified when two notable events transpired. First was the acquisition of Future Group by Reliance Retail. Future Group was Reliance’s competitor, and this takeover accelerated Reliance’s growth further. Next was the decision to offer up a small piece of Reliance Retail to Walmart. If this deal materializes, it will be a big consolidation against Amazon.
In every way, Reliance seems to be picking up on Amazon and Walmart to make a stronghold in retail. Earlier, Reliance claimed a major stake in Netmeds, the e-commerce pharmacy company. But Future Group has been Reliance’s massive win so far because this deal is valued at $3.4 billion and will bring Future Group’s retail, wholesale, logistics, and warehousing units under Reliance’s wing.