"COVID-19 was one jhatka.. We had no option but to exit," admitted Future Group's Kishore Biyani saying that the company lost 7000 crore in the first 3-4 months of the pandemic.
"Pantaloons sale was very different from the sales of this business. There was no other way we could have survived - the rent doesn't stop and the interest doesn't stop," said Biyani.
"Somehow everything came together because of COVID-19 and the only answer was to exit," added Biyani, referring to his recent deal with Reliance Industries which saw him sell his chain of retail stores, warehousing and logistics business to Reliance Retail on a slump sale basis for Rs 24,713 crore.
Tracing back the journey that led to the business trap, Biyani said that the company made too many acquisitions in the last 6-7 years, especially of small-format stores.
"The one lesson that I've learnt over the last few years is that don't invest too much of resources in new developments with your own money," said Biyani, referring to AI, big data etc which had seen huge investments but the ROI of which was still a couple of years away.
"Events like these make you very humble. The Future group family has been very supportive in this transition period. Have trained my daughters to not be too attached to what we create. We are still in the food, fashion and home business in some way," said Biyani in this exclusive chat with BS Nagesh, Founder, TRRAIN at the Phygital Retail Convention.
Speaking about the economy, Biyani said that the post COVID world has not come about and consumption has not started. He expects 30 percent of transactions to come from digital platforms. "We have to think digital first.
The worst is yet to come for retailers. We have designed business to be profitable at 90 percent of our targets. In any scenario… we will not be able to touch 70-80 per cent… If you look at long-term planning 5 to 10 years, it will not be easy for physical stores," said Biyani.
