SynopsisJust like its kirana strategy, Reliance Industries not only aims to sell to the end customer through its B2C business, but also supply to mom-and-pop pharmacy stores across the country.
The company, which acquired a majority stake in Chennai-based Netmeds in August last year for Rs 620 crore, is converting the online pharmacy delivery company’s wholesale business into digital through JioMart-enabled point-of-sale machines over the last couple of months and has plans to scale that up rapidly, one of the sources said.
Just like its kirana strategy, Reliance not only aims to sell to the end customer through its B2C business, but also supply to mom-and-pop pharmacy stores across the country.
In this model, the company gets orders directly from customers and asks the nearest partner store to deliver. These partners are set to play a crucial role in the company’s hyperlocal delivery plans.
Bengaluru-based Udaan is another player that has stepped into B2B e-commerce in pharma.
An executive associated with the company told ET that Reliance has “upped the game” in the past two months.
Pharma is considered an important category for Reliance JioMart.
The most important projects inside JioMart, one of the sources said, is building a marketplace that will compete with ecommerce giants Walmart-owned Flipkart and Amazon, as well as a beauty and personal care platform like what omnichannel beauty retailer Nykaa has done.
The company has opened around 114 Netmeds stores across the country as of May this year and has plans to take it to 200 by the end of this year, according to a third source.
These are mostly attached to Reliance’s Smart Point stores, which sell everything from groceries to electronics and medicines. These stores also act as fulfilment centres for its B2B and B2C e-commerce businesses.
Reliance Retail has hired former senior executives from pharmaceutical firm Cipla this year.
While Ramesh Juneja joined as senior vice president of Reliance Retail, Rajashekhar GM joined as a sales and marketing specialist.
Reliance Industries chairman Mukesh Ambani said during the group’s annual general meeting that Reliance Retail had about 200,000 employees and that it plans to increase this to one million in the next two-three years.
About four to five months back, the company made plans to hire 15,000 people for the pharma category alone, one of the sources said.
Chitra Thomas, a senior HR executive at the company, oversaw hiring for the pharmaceutical category before her departure to Tesla India.
Reliance Retail did not respond to ET’s queries.
In its recent quarterly earnings call, Dinesh Thapar, the chief financial officer of Reliance Retail, said that the company is “investing seriously” in Netmeds.
“We are growing quarter on quarter, profit was up 48%, we’ve launched a subscription model on stores, we’ve doubled the pharma footprint, and we’ve now expanded the hyperlocal capability,” he had said.
“We’ve launched Netmeds wholesale. We’re looking to scale that up, this is really the new commerce play that we have where we are partnering very closely with partner pharmacies,” Thapar had said.
The process of enabling B2B2C commerce has been complicated for the company, said one of the sources.
In 2019, Reliance had acquired C-Square, a company that provides an enterprise software solution used extensively in the Indian pharmaceutical supply chain across distributors, manufacturers and retailers. The company has faced problems integrating Netmeds and C-Square, one of the sources said.
Reliance’s kirana B2B business has been facing protests from traditional FMCG distributors after the company allegedly started undercutting them. Reliance has also used a similar strategy in the electronics category, aiming to sell smartphones and other devices to mom-and-pop mobile phone stores through JioMart Digital.
Reliance’s combined B2B and B2C heft helps it gain leverage at the negotiation table with brands and manufacturers. The company believes it can pass on the discounts to the end retailer through such a strategy.
(Originally published on Dec 24, 2021, 06:00 AM IST)
Share the joy of reading! Gift this story to your friends & peers with a personalized message. Gift Now