frl: Reliance could support 500 future retail stores and hire 30,000
In its Saturday edition, TOI was the first to report on Reliance’s move, which included delivering offer letters to FRL employees at the store level.
About 30,000 people employed by FRL are expected to join the rolls of Reliance Retail over the next few days, as the company intends to replace the signs of FRL-related brands in these stores with its own.
“Depending on store formats and locations, decisions will be made,” a source said. “Some, for example, could become Reliance Smart.”
The development is seen as a win-win proposition for the two entities which have faced a stiff legal challenge from Amazon over the past 18 months as the US e-tailer seeks to block the deal. This is part of the plan of arrangement to keep the FRL stores afloat at a time when the company controlled by Kishore Biyani defaulted on loan repayments and was classified as a non-performing asset.
“The company has struggled to fund working capital requirements. Rising losses at the store level are a serious concern and constitute a vicious cycle in which larger operations result in higher losses. a loss of Rs. 4,445 crore in the last four quarters Termination notices have been received for (a) a significant number of stores due to huge outstanding, and we would no longer have access to these stores The company is reducing its operations…,” Future Retail said in a stock market filing.