Arvind Brands Megamart chain to expand to 250 outlets

Bangalore: Arvind Brands would be investing the equivalent of $100 million over the coming three years to fund the expansion of its Megamart chain. 

The chain will grow to 250 outlets, and will deploy Oracle's retail software to upgrade merchandising and inventory management. Currently, the chain has 93 smaller stores, and a large store each in Chennai and Pune. The company had posted a turnover of Rs100 crore in the previous year.

Speaking to the media, Arvind Brands Retail chief executive officer J Suresh said that Oracle had created a product based entirely on Megamart customers' purchase patterns, and would forecast future trends, which he said would give the company a head-start when it implements its expansion program. 

Suresh said the expansion would be funded internally, while Megamart's chief operating officer K E Venkatachalapathy added, ''The Indian retail market was the fifth largest in the world by industry estimates and expected to grow from $330 billion to $427 billion by 2010. The share of organised retail could increase from 4 per cent to 22 per cent by then, requiring a planned and informed management''. 

Venkatachalapathy said that spending on information technology by players in the retail space in India had crossed $255 million.

Ronan Gilhawley, Oracle's head of retail for the Asia Pacific region said that Oracle's Centre of Excellence in Bangalore, which employs 400, was creating retail business products for other $nationwide chains, including one for the Aditya Birla group. He said savings in inventory, identifying more fast moving merchandise, and better coordination with vendors are key retail needs. Oracle will support Arvind by extending its scalable platform to manage its retail processes from supply chain to stores.

Oracle's solution would be deployed in the expansion of Arvind's centralized distribution centre and regional distribution centres across the country, and is expected to hike inventory returns, customer services, sales figures while allowing the maintenance of systematic and efficient data.

The deployment would take place in three phases, spread across 24 months, and will comprise five modules – merchandise management, pricing, inventory, in-store, and planning.

Additionally, Suresh said that best practices embedded in Oracle Retail applications would help Arvind in many ways, including the creation of a product mix based on data of customers' purchase patterns, and forecasting customer behaviour based on historical data.