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Last year, govt allowed 100% FDI in multi-brand food retail Global e-commerce major   Amazon   is aiming to enter the food retailing sector in India with investment plans of $515 million over the next 5 years. Food Processing Industries Minister Harsimrat Kaur Badal on Thursday confirmed the company’s investment plans while adding that Metro Cash & Carry has also shown interest in food retailing. Back in January, Amazon had filed its application with the Department of Industrial Policy and Promotion (DIPP). Online players Grofers and Big Basket also have also submitted FDI proposals regarding retail trading of food items. While Amazon is one of the major e-commerce players in India, Grofers and Big Basket are into online grocery space. Last year, in June, the government allowed 100 per cent FDI in multi-brand food retail, including through e-commerce. However, the food products have to be produced, processed or manufactured in the country. However, while th...

Euphoria around the Avenue  Supermarts (D-Mart)  initial public offering (IPO) of equity that saw 104 times more demand than the shares on offer might have overlooked a critical factor in the company’s growth so far. Namely, the predominant ownership model for its stores. The company had rapid growth in recent years, with 112 stores as of September 2016, from one in 2002. Though rapid, the net profit grew to Rs 321 crore in 2015-16 from Rs 60 crore in 2011-12, a compounded annual rate of 51.8 per cent. This, however, has been largely dependent on the predominant ownership model it chose. Including long-term lease arrangements, where the period is more than 30 years and the building is owned by the company. This is different from the rental model its peers, including Future Retail and Reliance Retail, chose.  "Retail is a low-margin business. So, it is very important to not only keep the cost low but predictable...