Big Bazaar, you must have heard about this store’s name, right? Chances are that once in your lifetime you also done your shopping from this place. The rise of this store has revolutionized the genre of shopping among Indian customers; this is something you can’t also deny ! .However, do you know that the way it has risen in a similar fashion; also it went on the path of downfall which is the reason you don’t hear about the name of this store anymore.
Now the question which will obviously arise in your mind that what went wrong for this company after facing such a strong success. For this, we first had to know about how the company has achieved success, as their success is also connected with their future failure.
PLEASE NOTE: A collection of crumpled, big and small bags from GRT Jewellers, Ratna Fancy Store, Pooja Prapancha, Big Bazaar, Kaiser-e-Hind Silks & Raghupathy Weds Radha is a distinguishing feature of a middle-class Indian household. It is not to be mistaken for financial stress. pic.twitter.com/3ij1klGVQv
— G S SHRIDHAR (Kuduvalli & Gangur Parivar) (@ushrit2020) July 18, 2024The Rise of Big Bazaar
It was 2001 when no one in India predicted that a small departmental store name Big Bazar that was opened in Kolkata within a few years would become the prime choice for customers regarding their shopping. The question obviously arises in your mind: how did this particular departmental store create such a huge impact in just a span of a few years? The answer lies with Kishor Blyani, the founder of this company.
Despite he was not from a business family, Mr Blyani has understated two psychology of Indian customers; it was that the majority of the customers in this country, before buying a product, always prefer to see it in a detailed way. The next one is that the customers always love to buy a product if a heavy amount of discount is associated with it. Basing his business on these two psychologies of customers this led him to see the successful rise of this supermarket. Within just 2 years, Big Bazaar saw itself expanding to various tier 1 and tier 2 cities in India, and by 2008, they were given the tag of the fastest-growing supermarket in the world.
However, the two psychologies of customers not only helped the company to gain there splendid success but also, in this process, the logo and tagline both also had a similar contribution also. The taglines like “Isse sasta aur Accha Kahin” and the classic orange and blue color logo have also attracted a lot of customers in this process.
Now, you must be wondering how the company, after having so many strategic plans in its mind, went onto the path of decline. Well, in this process, you will be surprised that some of their strategic plans are the key reason for it!
The Fall of Big Bazaar
When we said that their strategic plans were the key reason for their failure, we were not wrong in these circumstances. One of their strategic plans was to provide as much as a discount to their customers. Maybe the customers loved it, but the company was facing a burden on the process of giving such heavy discounts when, on the other hand they were also in the same time was busy expanding Big Bazaar to other cities.
Since the founder, Mr Blyani, didn’t come from a rich family to successfully run both of these initiatives together, he had to borrow various large sums of money. This has made the company, or precisely the group which it associated with future groups, fall into a huge trap of debt. The below one can provide a picture of how much the company has fallen into debt in this process :
| Company | Debt (Rs Crore) |
| Future Group | 29,000 |
| Future Retail | 21,000 |
| Future Enterprises | 11,000 |
Another thing that has contributed to the fall of Big Bazaar is the huge amount of competition. In the mid-2000s, they enjoyed a long, steady run due to there being no competition, as this concept was relatively new in the Indian market. However, from the late 2000s, they have started to face major competition not only from new companies but also from various large enterprises of India like Reliance which started to enter into this venture. The competition, especially from large enterprises, and also the lack of approach in this process by the company to successfully overcome the competition, made the company quickly fall flat into the market.
However, it would be wrong to say that they didn’t take any approach as Big Bazaar has taken one of the approaches in this process to mitigate the completion atmosphere, but it has massively backfired. The approach was to acquire various new companies who have entered into this business like Neelgiri, WH Smith etc. However, this decision had a negative impact on their business as they quickly realized that these stores had become a major liability for them and for business experts; this is one of the major causes for their failures as a lot of money was spent acquiring them.
However, another question in this process also has emerged in your mind; we bet that what is the current situation of Big Bazaar? Is it permanently closed? Or is it still open? Well, the current situation is a little bit different from what you are thinking.
The current situation
In 2020, during the time of COVID-19, Big Bazaar was in there worst phase ever with lots of debts, and even there e-commerce website was also not clicking well among the customers. In this process, in late 2020, Reliance Industries showed interest in buying the company for 24,700 crore rupees. However there were lots of obstacles in this process in this accusation. However, in February 2022, Reliance successfully acquired more than 260 Big Bazaar stores in India across 120 cities. As of the present day, all of the big bazaar stores have been closed in India, and they have been renamed to Reliance Smart Bazaar.
What are the lessons being learnt from this scenario?
One of the major lessons which can be learned from the failure of this company is that you shouldn’t just go on the approach of expanding to maximum cities, especially where you can’t be presented properly, or you don’t know anything about the behavior or demography of the consumers there. Another thing is that you shouldn’t opt for acquisition or discounts without road mapping any plan before it.
FAQ
What was the main reason for its initial success?
Their understanding of Indian consumer behavior, especially their preference for physical inspection and discounts.
Why did it start to decline?
Excessive debt, increased competition, and unsuccessful acquisitions led to its decline.
What happened to the company after its decline?
Reliance Industries acquired a significant number of stores and rebranded them as Reliance Smart Bazaar.
What lessons can be learned from its downfall?
Avoid aggressive expansion, be cautious with acquisitions, and maintain a balance between growth and profitability.
Is it still operational?
No, the stores are no longer operational under the traditional name.
