Mumbai: Godrej Nature’s Basket, the gourmet food and beverage retailer that shut most of its stores in Delhi-NCR earlier this year, will now focus on online sales.
The chain store, a unit of Godrej Industries Ltd, will open new physical stores only in south and west India, where it has seen faster growth, Nature’s Basket chief executive officer Avani Davda said.
“Our new value proposition requires us to re-invent our store experience and our differentiated product offerings,” Davda said in an email interview.
“We are choosing to do that in our largest and strongest markets in south and west that have the highest potential for penetration and growth.”
The company will, however, sell online in all their markets, she added.
Godrej Nature’s Basket will set up a new flagship store in the first quarter of financial year 2018, and open another four in Mumbai, where the company is based.
In the last financial year, parent Godrej Industries reported that Nature’s Basket had generated revenue of Rs271 crore, a 30% growth from a year earlier, without giving further details.
However, data from Nature’s Basket’s filings with the Registrar of Companies show the retailer’s losses have been widening faster than growth in revenue.
In financial year 2015, it made losses of Rs42.61 crore on revenue of Rs209.45 crore.
“Revenue has been growing at upwards of 25%”, Davda said. “The like-to-like store comparative growth is at 21%. The company will maintain a similar growth trajectory to end the year with revenues of approximately Rs350 crore this financial year.”
In December last year, chairperson Tanya Dubash announced a restructuring plan for the company, ‘GNB Refresh 2020’, that targeted Rs1,000 crore revenue in three-five years and redesigning the store to make it the “freshest and finest” neighbourhood store, Nature’s Basket said in a statement.
“This transformational journey will ensure growth in a sustainable and profitable manner,” Dubash said.
Davda is clear that online sales is a significant way for the company to drive growth. She is now combining online sales through the Nature’s Basket website and home delivery options to boost sales. “Convenience is absolutely imperative, and between these two channels, which are now integrated, it accounts for 22% of our business,” she said. Nature’s Basket acquired online grocery store ekstop.com, Mint reported in February 2015. The deal was valued at Rs30-40 crore. This website was integrated in the company and became Nature’s Basket’s website.
Nature’s Basket has two main private label brands, Healthy Alternatives and L’Exclusif. Healthy Alternatives was launched in September and is a range of ‘wellness’ products including staples, snacks, oils and eggs. L’Exclusif is a premium gourmet products brand that includes nuts and chocolates.
Davda is also working on redesigning Nature’s Basket stores. “Our existing and new stores will be transformed, leading to become the ‘freshest and finest’ neighbourhood store”, she said in the email. “The refreshed design will be unveiled by early FY18.”
“Nature’s Basket is probably still trying to figure out their model, because the space they are in - gourmet food and beverages - is a concept that is yet to be completely picked up,” an analyst at an equities brokerage firm said, requesting anonymity.