People have reduced buying frenzy: Spencer's Retail's Shashwat Goenka

Supply chain for essential items has been ensured in the country, says Shashwat Goenka, sector head for FMCG & Retail at Spencer's Retail.

Spencer’s Retail, part of the RP-Sanjiv Goenka Group, is the only retail chain to have kept 90 per cent of its stores operational during the lockdown. While it is banking on tie-ups with aggregators for home delivery, Shashwat Goenka, sector head (FMCG & Retail) at RP-Sanjiv Goenka Group, discusses the Covid-19 situation and Spencer’s unique initiative, in an interview with Avishek Rakshit. Edited excerpts:

What is the situation with Spencer’s Retail and Nature’s Basket?

Both Spencer’s Retail and Nature’s Basket are operational. We are the only retailer in the country to have 90 per cent of our stores up and running. We have 160 stores for Spencer’s and another 34 for Nature’s Basket, totalling close to 200 stores. At the moment, people are buying more of staples, grocery items, cleaning products, sanitisers, and masks. As a result, the private label at Spencer’s — Smart Choice — has picked up very well.  

There was lot of panic buying that happened on the eve of, and after the lockdown. What is the situation now?

During the first 3-4 days, people would come and buy enough grocery to last them 2-3 weeks, given they weren’t sure of what would happen next. However, the government has now given people reason enough not to resort to panic purchase. We now see that people have reduced their buying frenzy, and are purchasing on a weekly basis. It is because people now know there is continuous supply of essential items. 

Do you see panic buying boosting your revenue?

 The store is a combination of essential and non-essential items. We have key non-essentials like homeware, electronics, and clothing that we have removed, and are not allowing users to purchase. These items, which technically are higher margin categories , aren’t selling now.

Do you think momentum in these categories can be sustained in the near term?

As consumers aren’t keen on spending on non-essentials, their purchasing pattern is more skewed towards essential items now. When things ease, people will start buying items that hitherto they weren’t able to, so there will be a spike in sales of non-essential items.

We are seeing tie-ups with aggregators for delivery of essential items, across the industry. Have Spencer’s and Nature’s Basket done the same?

We have done 9-10 different delivery tie-ups with Uber, Flipkart, Rapido, and others. We were the first to reach out to these delivery and service companies, which was done within the first three days of the lockdown.

Do you intend to take this model forward after the lockdown is lifted?

These tie-ups are definitely here to stay. The idea is to work together now, but one needs to revisit these once the situation normalises, after which we can take a call.

On the technical front, what initiatives have you taken?

We are launching a new chatbot that will be ready to go live in 3-4 days. It is a URL that will ask the delivery pin code. Once entered, it will show a list of available stores and a list of items that can be delivered. Once the consumer finalises it, the chatbot shows the delivery person and available time-slots for delivery. It will be a big game-changer.

Planned capex is getting deferred, across sectors. Are you also doing the same?

We had planned 3-4 new stores in Kolkata, Gurugram, and Hyderabad during the second half of the first quarter. These will be deferred now.

With grocery and essential items in demand, will you focus more on these, instead of apparel that has been your key focus area?

Once the situation normalises, the primary focus will shift back to apparels.