Food Bazaar engages Hind Lever in battle

Fast-moving consumer goods major Hindustan Lever Ltd is up for competition in its food and grocery home delivery venture, Sangam Direct.

Last week, the Rs 650 crore (Rs 6.5 billion) Pantaloon Retail's Rs 100 crore (Rs 1 billion) venture Food Bazaar soft launched "Food Bazaar On Call", a phone shopping and home delivery concept, in parts of Navi Mumbai.

By next month, Food Bazaar, launched in July 2002, plans to take this toll-free dial-in service to north India, by rolling out the concept in Gurgaon. Ambrish Chheda, chief, business development, Pantaloon Retail, said, "We are looking at new satellite cities, where large format retail has not fully matured and the choice available is limited."

"We'll take home delivery shopping to another level by introducing many innovations."

Company executives reveal that there are plans to introduce kiosks at prominent locations.

The company says the demand for home delivery at its existing Food Bazaar outlets prompted this move. For example, Food Bazaar stores in Mumbai offer consumers with a shopping bill of more than Rs 1,000 free home delivery within a 10-15 kilometre radius of the store. But in this case the customer has to physically place his order at the store.

Food Bazaar, which was part of the hypermarket store, Big Bazaar, was spun off as a separate division of Pantaloon Retail recently. It also comes at a time when RPG Enterprises' Food World is spreading its geographical reach. RPG's Giant hypermarket was launched in Mumbai a couple of months ago.

Unlike Hindustan Lever, Food Bazaar will offer free home delivery within six hours, irrespective of the order size. In comparison, Sangam Direct, charges Rs 20 for orders below Rs 400 and goods are delivered a day after the order is placed.

While Sangam Direct talks of convenience in Shopping, ghar baithe, Food Bazaar's positioning is "Wholesale price. Doorstep delivery".

The venture will roll out nationally by the year-end, according to Chheda. At present Food Bazaar has 13 outlets in the country. The number of outlets is expected to increase to 30 by December 2005.