Offline retail is the backbone of India’s retail industry and is likely to remain so even with the increasing ecommerce penetration. Most online brands are already going phygital and the demand for organised retail chains is growing faster than ever, more so in tier-2 and tier-3 cities. To fulfil that demand, brands need to open retail stores faster than the current rate. Given the lack of any institutional option, most of the retail industry rely on small local contractors to build out their stores. While there are enough such contractors, most of them are unreliable, inefficient and non-scalable; often leading to delays as well as higher costs – depriving the industry from the opportunities knocking at its doorstep.
Imagine you run a top tier apparel consumer brand and you are deeply buried in launching the new brand look for the summer collection. Your top executives are busy planning upcoming marketing campaigns and your operations team is neck deep in managing inventory, logistics and store operations day in and day out. To meet your next year’s expansion goals, you decide to open 50 new stores across 30 cities in the next 6 months.
But guess what, none of the top executives are available to focus on store expansion as they’re already occupied with running the core business. You appoint a project manager and hire a few executives to oversee the opening of new stores. They work with brokers to find the location and partner with a few local contractors to build out the stores. The local contractor, who is typically a small business running multiple projects with limited manpower, often delays the project due to lack of planning & monitoring and logistical delays. Despite regular follow ups, the new store opening is often delayed by a few months. At times, you have to get the work redone because the quality is not according to your brand guidelines as the local contractor doesn’t understand how much a change in design can impact your brand. For your business, each day of delay is a loss of potential sales. It is likely that even after fire fighting everyday, your project team is able to open fewer stores, at a higher cost and a delayed timeline, all of which results in revenue loss for your business.
Nearly all of India’s $200B organized retail industry across F&B, Automotive, Apparel, Grocery, FMCG, Cosmetics, Electronics etc go through these challenges everyday. India’s organized retail is expected to grow at a CAGR of ~20% and has a potential to reach $500B by 2026. This growth will be driven by both:
a. Established players aggressively building retail stores in tier-2 and tier-3 cities (Tata, Reliance, Ceat, DHL, Xiaomi, Puma etc)
b. New-age online brands adopting the omnichannel approach and building their offline presence (Nykaa, Mamaearth, Infra.market, Lenskart, Pepperfry, Spinny etc.)
Despite the growing demand, the retail industry is likely to face challenges in developing the capability and efficiency required to build the store infrastructure at such a fast pace – something that is not their core. In some cities there are regional organized agencies who offer turnkey services for brands to build their stores. These agencies typically operate in larger cities and are people dependent. They are unable to scale due to the lack of use of technology in an operationally intensive business.
Enter 91Squarefeet – an organized, tech-enabled company that provides scalable store build-out services to retail chains. 91Squarefeet (91Sqft) is solving the above problem by streamlining the entire process using technology and efficiently delivering finished stores within a pre-set timeline, saving potential revenue loss for brands. 91Sqft operates a managed marketplace at the back-end where they partner with factories and local contractors while efficiently planning and closely monitoring their work using technology. They have displayed how the use of tech across various stages of the project helps prevent unnecessary delays and reduces cost.
91Sqft offers a one-stop project management solution at pan India level offering following value prop for the retail industry:
- Faster turnaround: They are able to deliver projects in stipulated time because of their vast network of reliable suppliers and use of technology for project management. It offers deeper penetration in tier-2 and tier-3 cities and helps brands scale faster across the country.
- Reduction in cost: At the customer’s end, they reduce the need for large project management teams in an area that’s not core to the business. 91Sqft also removes inefficiencies from the system making it cost effective for the brands.
- Increased visibility: Customers today get WhatsApp or email based visibility but no single real-time dashboard to know the progress of each store. Customers want this visibility to help them plan & forecast better and reduce anxiety around the business.
We understand the problem 91Sqft has set out to solve requires a lot of heavy lifting. The founders – Amit Bansal, Amit Mishra and Puneet Bansal are all ex-entrepreneurs with relevant experience. They bring the right mix of execution hustle, technology orientation and perseverance required to disrupt this industry. They earlier built a logistics SaaS company – Quifers for over 5 years that eventually got acquired by Sitics Logistics. We are excited to partner with this team of repeat founders and are keen to witness how they shape the future of the retail industry with learnings from their past experience.
We believe that 91Sqft has the potential to become an operating system for retail stores, just like Shopify is for online stores. Imagine a company building its retail presence and using 91Sqft’s plug and play solution for location intelligence, design ops, store build-out and POS.
Authored by: Naman Lahoty