Bigbasket- India’s Online Grocery Store (Case Study)

Bengaluru-based grocery startup BigBasket (Website bigbasket.com) has come a long way from being a grocer startup to becoming a unicorn (privately held startup company valued over $1 billion) and it is the only grocer in India to achieve the distinction.

Today, BigBasket is India’s largest online food and grocery store. You can choose from a wide range of options in every category, exclusively handpicked to help you find the best quality available at the lowest prices. Select a time slot for delivery and your order will be delivered right to your doorstep. The company offers its services in several cities in India.

BigBasket is also striving to create in-house brands like Fresho for vegetables and idli/dosa batter; Staples- Royal and Popular; Tasties for snacks.

BigBasket to invest $100 mn to strengthen supply chain

Alibaba-backed company Big Basket is pumping in $100 million (about ₹698 crore) to strengthen its supply chain by setting up vending machines and smaller distribution centers across various cities.

The online grocery platform which supplies all the daily essentials required for daily cooking needs of people – registered as supermarket Grocery Supplies-had recently raised $150 million in funding led by Mirae Asset-Naver Asia Growth Fund, CDC Group and Alibaba. Founded in 2011 Big Basket operates in 25 India cities. It plans to utilize the proceeds-which has placed the Bengaluru based firm in the unicorn club-to further expand into existing markets with more investments in the first mile, scaling-up of its supply chain. “We want to enable 2-hour delivery in top 10 cities that we operate in by July. For that we have been investing in strengthening our distribution centers” Big Basket cofounder Vipul Parekh told PTI.

The company expects its capital expenditure towards these initiatives to be about $100 million this year.

“We are ramping up our milk subscription business – BB Daily – under which we have built the supply chain to deliver milk and other items in the morning. The service was started around September last year and our sellers already carry out 90,000-100,000 orders a day. We are aiming to take this to a million orders a day and a stronger supply chain infrastructure will play a key role in this” he said.

Another area where the firm is investing is in towards setting up unmanned vending machines – BB Instant – in office and apartment complexes.

“We see a huge potential of these machines. Customers can use their app to access the machine and buy products. The only human intervention is in re-stocking. We have already placed such machines at 200 sites in Bengaluru and over the next one year, we want to have 2000 such sites across the 10 large cities where we operate” Parekh said.

Also given that these machines are placed within apartment and office complexes, the risk of vandalism is lower.

Parekh said that with these investments Big Basket which competes with Softbank-backed Grofers as well as Amazon.in and Walmart owned Flipkart, will continue to build further on its leadership in the grocery business. They can gain more market share by improving their distribution and increasing their basket of product range, focusing on healthy food or organic food. Also they have been there or some time now so they could encash on their brand value by using strategies that the competitors could not think of or would not attempt to do

Q. What is Big Baskets primary business? How do you think is their strategy to consolidate their market position?

Q. What are the factors which will drive the growth of online Groceries in the current scenario? What can they do better to improve their market share?

Q. a. How important do you think supply chain will play its role to improve Big Baskets revenues?
b. Who are Big Baskets competitors how can they gain more market share from their Brand value that they have in the market?

studymumbai

StudyMumbai.com is an educational resource for students, parents, and teachers, with special focus on Mumbai. Our staff includes educators with several years of experience. Our mission is to simplify learning and to provide free education. Read more about us.