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Reliance to set up 2,000 retail outlets by Dec 2006

Reliance to set up 2,000 retail outlets by Dec 2006

Author | exchange4media News Service | Saturday, Jan 29,2005 8:11 AM

Reliance to set up 2,000 retail outlets by Dec 2006

Reliance Industries Ltd (RIL) will set up 2,000 new retail outlets by December 2006. Of these, 1,500 outlets will be run by franchisee partners, a stark departure from RIL's current policy. Almost all of RIL's present 300 outlets are company-owned.

The first 15 retail outlets will be commissioned by March 2005, said a senior Reliance official. Eventually, of the 2,000 petrol pumps, only 450 will be company-owned, while the remaining 1,500 pumps will be owned by franchisees.

The franchisee contracts could be of two types — where both the dealer and company share investments or where dealers invest in the outlet and lease it back to Reliance. But the overall structure of any of the models will be such that control will continue to rest with the company, the official said on the sidelines of an industry seminar.

Reliance will also shift its focus from highways to metros. The company has so far focused on highway outlets. According to the official, the company's strategy so far was to establish its presence through large outlets along highways and arterial links.

Earlier, Mr Hital Meswani, Executive Director, Reliance Industries, in his presentation, called RIL's oil retail network the largest greenfield rollout in the world. He said the company would continue to focus on diesel sales. The company, on an average, sells 2.5 times more diesel through its retail outlets compared to other oil companies, he said.

Essar Oil, another recent private sector entrant in oil retailing, will set up 500 new retail outlets by March-end this year, said Mr S. B. Prasad, Head- West Zone Retail Marketing. The company, which is presently selling on an average 180 to 200 kilolitres of diesel through its pumps every month, will set up 1,500 new retail outlets by mid-2006.

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