NEW DELHI, Feb 23: Tech-enabled convenience retailer New Shop is on track to double store count to 600 by year-end, a tally that would include rebranded 24Seven stores being acquired from Godfrey Phillips India (GPI), and is also eyeing overseas expansion.
Moreover, a possible new round of funding this year would be aimed at bringing in new investment partners to handhold and guide the firm through the next phase of growth.
New Shop is also on prowl for acquisitions and buyouts, with co-founder Aastha Almast symbolically describing herself as a retailer who simply “loves to shop”.
On the recent move to acquire 24Seven stores from GPI, Almast said that about 35 stores have already been rebranded to New Shop and franchised out.
The conversion of all stores will be completed by March-end.
The 24Seven acquisition – whose financial details have not been disclosed yet – has enabled New Shop to clear a long backlog of waitlisted entrepreneurs (keen to become franchisees). For New Shop, the acquisition meant ready availability of 100 locations it could franchise out to waitlisted franchise owners.
“It automatically adds speed…We saved six months of research time by acquiring retail assets of GPI, ” Almast said.
Overall, New Shop has about 300 stores, and expects to double its store count by the end of this year.
New Shop, which runs on a franchise-operated model has stores concentrated around mass transit hubs or densely populated neighbourhoods, even corporate parks.
“Our cost structure and operating structures are lean, given our franchisee model. We are an asset-light company, so we don’t operate these stores ourselves. I believe, Kirana stores are profitable because entrepreneurs – not store managers – run the store. When you put an entrepreneur, the bottom line approach is more powerful,” she opined.
On how the model works, she said that typically entrepreneurs buy or take the retail store on franchise, while New Shop brings in technology, partnerships, licences, processes, and lends the label.
“They invest in the capital expenditure, they invest in the inventory, they invest in everything but how to run the store is an expertise that we bring to them, both in terms of technology and in terms of partnerships or licences, so you literally can just come to me and say I want to become a retail owner, and I will figure out everything and have your store up and running in 30 days,” she said.
The growth momentum is strong for the company in non-metro towns and cities.
A case in point is Jaipur where the company scaled to a dozen stores in a matter of six months, according to Almast.
“Growth levers are Tier 2, Tier 3, Tier 4 cities. Also, India is going through a massive infrastructural move, and we are part of that growth and development infrastructure by being that store on a highway, at a gas station, railway stations… where people are truly looking for stores on-the-go. So many levers are coming from transit retail and our own growth in smaller cities and towns,” Almast said.
New Shop is India’s leading chain of 24/7 convenience stores, dedicated to meeting consumer needs anytime, anywhere, through a vast network of accessible and efficient touchpoints. (PTI)
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