Bharti to set up three tier retail model

New Delhi: Telecom tycoon Sunil Bharti Mittal's Bharti Retail says it has decided on a three-tier retail format that will provide customers access to a store 1.5km to 7km from their homes.

Bharti Retail is planning a small-format convenience store located within 1.5km of customer's homes, a mid-level store 2km-3km distant and a hypermarket within a 5km-7km drive.

This is in sharp contrast with the Wal-Mart retail model in the US, which is dominated by large-format stores on city outskirts. The world's largest retailer has a few small convenience stores in countries like Mexico to cater to neighbourhood demand.

The small stores will range from 2,000 sq ft to 5,000 sq ft in size and will mainly stock food, grocery and household items that have a high purchase frequency. The company plans to build a majority of the stores within this format under a model that will franchise existing mom-and-pop stores.

The hypermarkets will range from 75,000 sq ft to 1.5 lakh sq ft in size and a mid-level store will be 25,000 to 50,000 sq ft in size.

Bharti Retail hopes to have over 10 million square feet of retail space by 2015, and is also considering shop-in-shop formats (under which it would rent space to a jewellery or pharmacy chain), and a private label for food, grocery and even consumer electronics.

It is also studying the possibility of introducing free home delivery services and an online format, should customer demand exist.