Future Consumer Enterprise: Weaving A Bigger Network

Kishore Biyani, touted as the Sam Walton (Walmart founder) of India, has not only revolutionised retailing in India but also changed consumer behaviour with his Future Consumer Enterprise business. Last year, he laid down his vision to transform his retail-led enterprise into a consumer goods giant.

Future Consumer Enterprise (FCEL), which forms about 25-30 per cent of the parent Future group, is set to become the fastest growing segment. It is India’s first sourcing-to-supermarket food company. Starting from the seeding of food at the farm to its consumption, FCEL acts as a catalyst for each of its stakeholders. From sourcing, processing, retailing to the final act of consumption — FCEL strikes a widespread cord with the the farmer, the factory labourer, the worker on the shop floor and the housewife.

The company, featured in BW Businessworld’s welterweight category, has seen phenomenal growth with an average four-year sales growth of 250.1 per cent and an average four-year PAT growth of 286 per cent. Continuing the momentum, the first three quarters of FY16 also witnessed a 40 per cent year-on-year growth in revenues, while gross margins improved to 15.9 per cent, up 300 basis points. The company is expected to post revenues of over Rs 2,200 crore during this financial year.

“In the long term, one has to build an Indian food company in India and we will be the leader in this space. We see ourselves growing at 40-50 per cent, much above the industry growth rate of 7-10 per cent,” says Kishore Biyani, vice-chairman of Future Consumer.

The growth has been led mainly by expansion of its various businesses. During FY2015-16, the company introduced its products in the EasyDay network, the Nilgiris network and the Star Bazaar in addition to them being distributed through Big Bazaar, convenience store chain KB’s and the rural distribution arm of Future Group, Aadhaar.

It expanded Nilgiri’s geographical footprint with the launch of milk and value-added dairy products in Delhi as well as extended the Nilgiri product range with the launch of cheese cubes, spread butter, cheese slice and fruit yogurt. It also introduced Crème De Lite, a range of Crème spreads in five exciting flavours.

Also, the company acquired brand Kara, which offers a range of cleansing wipes and on-the-go beauty products, from Aditya Birla Group. The buy gave FCEL access to distribution in over 10,000 small pharmacy shops and chains.

During the year, FCEL aslo launched Desi Atta, which currently offers over 24 variants of flours and ready mixes. The company plans to add another 40 variants.

FCEL also forayed into frozen foods, frozen fruits and vegetables and packaged food. It started distribution through 1,000 PDS outlets in Rajasthan and expects to reach 5,000 outlets in 2016-17.

ayushman@businessworld.in; @ayushmanb