Spencer’s Retail launches quick deliveries, exits loss-making markets | Company Business News

New Delhi: Multi-format retailer Spencer’s Retail Ltd on Thursday launched its quick delivery service—Jiffy—even as it exited more loss-making markets, confining its operations to just Uttar Pradesh and West Bengal.

This move comes in response to consumers increasingly ordering groceries online.

The Kolkata-based retailer will transition its existing Spencer’s ordering app to its quick delivery platform Jiffy that will service both on-demand orders as well as slotted deliveries within 30 minutes. The retailer sells FMCG, fashion, food, staples, general merchandise, personal care, home essentials, electrical and electronics items to consumers.

“Online is where the big growth is. That’s also where the market is transitioning. There is a huge transition especially in urban centres, which is happening where people are moving away from e-commerce to quick commerce,” Shashwat Goenka, chairman, Spencer’s Retail Ltd, said in a virtual interview on Thursday.

It shuttered more than 45 stores over the last two quarters in south and parts of north India. The company operates 89 Spencer’s stores; it also operates outlets under the Nature’s Basket (34) and Artisan Pantry brands.

The move comes as more modern trade retailers are struggling to keep up with quick commerce—a more recent phenomenon whose entry has impacted the country’s broader retail ecosystem. The entry of companies such as Blinkit, Instamart and Zepto  has threatened both small, mom-and-pop stores as well as established e-commerce and modern trade chains.

The Indian quick commerce market was valued at $3.34 billion in 2024. It is expected to nearly treble to $9.95 billion by 2029, per a report by financial services firm Chryseum.

The impact of quick commerce on the retail ecosystem cannot be “denied”, said Goenka.

“Quick commerce is a big thing. However, no economy in the world has seen an entire business shift to e-commerce. But quick commerce is here to stay. No player can survive without offering it,” he said.

Plans to double orders

Spencer’s plans to double orders via its online ordering platform over the next three quarters. Currently, Spencer’s draws 10-11% of its sales via e-commerce.

For the December quarter, the company’s consolidated revenue fell 24.3% to ₹417 crore on account of store closures. The company reported a flat like-for-like sales growth during the quarter on account of a “soft festive” trading environment. “Spencer’s delivered a very strong operational performance on the back of good gross margin delivery (19.7%), strong control on all operational cost lines resulting in a milestone Ebitda (pre-INDAS) positive achievement,” the company said in its earnings announcement Thursday.

Ebitda stands for earnings before interest, taxes, depreciation, and amortization, and is a key profitability metric.

“This is a strong validation of our decision to focus on core geographies, exit from loss-making, non-strategic regions and drive improvement across all operating metrics such as margins, sales productivity, and costs and to bring the business to operational profitability,” the company said.

The moves comes as the company has trimmed losses and exited unviable markets to focus on core geographies and drive improvement across margins, sales productivity, and costs.

Over the last two quarters, the retail chain has exited markets down south including Kerala, Tamil Nadu, Andhra Pradesh, Telangana along with Delhi-NCR.

“There is an impact on the topline, there’s no denying that, but it was a conscious call taken by the board because profits were missing. There was also limited scope to grow profitably. We believe we can grow profitably in Bengal and Uttar Pradesh (UP),” he added.

Spencer’s will tap unserviced demand in markets of UP and West Bengal.

The retailer will add 10-12 Spencer’s stores annually while monitoring their performance for profitability, Goenka said.

The company will use the existing network of Spencer’s stores to fulfill orders, avoiding the need for dedicated dark stores. 

The transition to faster deliveries will be undertaken under brand Spencer’s only. Its more upmarket gourmet retail chain Nature’s Basket will also undergo a revamp in the coming months with more features being added to the ordering platform.