Kishore Biyani is in the middle of the retail wars being fought by Amazon and Reliance and may be the sole loser
Kishore Biyani was Indian retail’s poster child 15 years ago, featured on the covers of top business magazines and being a regular on the front pages of financial dailies. We were told that he was building a retail empire through Future Group that would rival that of the Walton family’s Walmart. He even wrote a book, It Happened In India, to celebrate his success. His Big Bazaar store sales on national holidays attracted thousands of people and there were kilometre-long lines outside outlets in order to get a bargain. But Biyani, like many others in different industries, never saw the internet coming and it hit his business like a freight train. The irony of a group named “Future” not realising the future of retail will likely become a case-study in some business schools one day. Biyani was forced to first drive a deal with Amazon and then later deal with Reliance Retail as well. Amazon subsequently claimed that the Future Group could not sell its retail assets to Reliance and went to emergency arbitration in Singapore which gave it relief. While this should bring up questions of why Indian corporate battles constantly go to arbitration in nations like Singapore and the United Kingdom, it is also bad news for Biyani.
Yes, he has a massive ready-made network of retail stores across the country which Amazon or Reliance would love to get their hands on. More importantly, both multi-billion dollar companies would not want the other to get their hands on it. While both Amazon and Reliance have issued statements with all the right words, it appears that this matter will not be resolved anytime soon. This is horrible news for Biyani and his retail empire, which was already bleeding but was dealt a body blow by the Coronavirus-inspired lockdown and the closure of malls. Amazon and Reliance don’t just have the pockets to ride out the crisis, they also know that if they can’t get their hands on the asset, they can always create another one with real estate being a lot cheaper than ever before. What happens next only the courts will decide.
