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Read more about Online grocery BigBasket to enter offline to beat back Amazon, Flipkart on Business Standard. Mulls setting up kiosks for stocking daily groceries, plans to start its own subscription service for milk and bread
beat back Amazon, Flipkart
In a bid to stay ahead of rivals Amazonand Flipkart, India’s largest online grocer
BigBasket is looking to open offline kiosks that will stock daily groceries and is
also planning to start its own subscription service for items such as milk and
The move comes soon after BigBasket raised $300 million in funding led by
China’s Alibaba which is looking compete with Amazon in India through
investment in local players rather than on its own.
Hari Menon, co-founder and CEO of BigBasket, in an interview with Times of
India, said that the company was looking to open thousands of such offline kiosks
as it looks at aggressive growth this year. The small stores will be setup in
apartment complexes and offices as it targets customers who want to quickly pick
up fruits, vegetables and daily use items.
"The pilot is under way at select apartments and office premises. We have kept it
as a separate app and are looking to scale this up as it will solve a genuine user
problem for items they need quickly,” Menon told the Times of India.
BigBasket is also working on a separate service called BB Instant which promises
delivery of products within two hours.
Amazon, which is investing heavily in building its grocery business also offers a
service called Now that delivers goods to a customer’s doorstep within two hours.
Last week Amazon announced the opening of 15 new fulfilment centres across
four cities that would help its grocery and fresh produce business in India. The
company is among the first MNCs to take advantage of the government opening
up 100 per cent FDI in food retail sector, and is running a pilot in Pune for this.
While BigBasket has been able to edge out rivals such as Grofers, its success in the
market has paved the way for giants Amazon and Flipkart to begin looking at the
online grocery space. Both firms are betting big on the category to drive repeat
purchases and act as a funnel to bring in customers to shop on their platforms for
more high-value goods.
BigBasket, which is now backed by giant Alibaba, is looking to ramp up its revenue
from Rs 2 billion to Rs 3 billion in the next few months and says it is on route to
hitting Rs 5 billion by March 2019. Menon in an interview with Business Standard
had recently said that the company’s operations in Bengaluru had already broken
even and other cities would follow by the end of the year.
However, the company’s path to profitability could be pushed back further as it
now looks at building an offline presence and come up with services to stay ahead
of Amazon and Flipkart. Experts say that the war in the online grocery space could
mean bad news for offline stores, especially small unorganised players, as cash-
flush online players spoil customers with big discounts.
Article By - Business Standard