French hypermarket to enter Indian market
The French hypermarket giant, Auchan, has struck a franchising deal with Max Hypermarket India Private Limited giving it access to the lucrative Indian retail market.
The thirteen existing Max Hypermarket stores will be rebranded under Auchan's colours this year and will operate under the franchise agreement, with plans to open twelve to fifteen new outlets in a year in various parts of India, the French retailer said in a statement on Monday.
"We consider this new franchise partnership in India as a great opportunity for Auchan to enhance its brand on a very high potential market, characterised by a dynamism and a strong economic growth," said Philippe Baroukh, general manager for hypermarkets at the Auchan Group.
Auchan, one of the world's top food retailers, currently operates in twelve countries and the franchise deal will allow it to enter a market estimated to be worth 350 billion euros per year.
Opposition by domestic retailers scuppered planned reforms to allow foreign companies to directly enter the Indian market, but franchises are authorised.
The French retailer posted 44.4 billion euros in sales last year, with 55 percent of that generated abroad.
Max executives said they believe the tie-up will help ensure success as the company founded in 2004 continues to expand rapidly.
"Auchan's expertise in managing hypermarkets and our understanding of the Indian market will ensure we bring the best of value, choice and experience to our customers," Max Hypermarket Managing Director Viney Singh said in a statement.
Max has had a franchise agreement with the Dutch group Spar since 2007 but that deal expires this year.
Max is controlled Landmark Group, a Dubai-based conglomerate that also owns hotels and restaurants in the Middle East and India.