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Reliance Retail is looking at opening 400 small formats consumer durable stores under the 'Reliance Digital' brand in the rural and semi-urban markets.
This will be the second major durable retailing initiative in the domestic market after competitor Tata Group's Infiniti Retail-owned Croma, but the first that is focused on the small format stores targeting rural and semi-urban areas. Infiniti Retail, however, hopes to enter the semi-urban and rural markets only in the next two years.
With rural markets already contributing 60 per cent to the overall cathode ray tube (CRT) TVs market, there is a good potential for categories such as music systems and DVD players to grow there. These products will help the overall durables market to grow by an additional 5 to 10 per cent in the next two to three years. The overall durables segment in India is pegged at Rs 20,000 crore.
TCL has recently tied-up with Reliance Retail to sell TCL branded products in the rural market. TCL Holdings India is planning to sell 70 per cent of its targeted 6-lakh units in durables in the rural market this year. The company is setting up 50 franchisee-operated mini formats of exclusive 'TCL' branded outlets in semi-urban areas with a population of one lakh and above. 25 'TCL' branded outlets by June-end 2007 and the remaining 25 by March, 2008.
The rural market with a population of one lakh and above had contributed 26 per cent to Samsung's total durable sales last year