Online grocer BigBasket to offer 1-hour delivery, ties up with kirana stores

Taking a leaf out of Amazon’s success in tie-ups with neighbourhood mom-and-pop stores is India largest online grocer, BigBasket. Just like the ecommerce biggies like Amazon and others are looking at multiple ways to get closer to shoppers’ homes, BigBasket is also looking to offer 1-hour delivery through tie-ups with neighbourhood stores.

BigBasket’s plan for 1-hour delivery

To secure higher margins from the category, BigBasket will implement 1-hour delivery to its customers through the following:

• Tie up with kirana stores, customers can pick up their orders from these partner stores

• Sell own brands like Fresho, Popular and Royal through partner stores

• Store staff will handle delivery, while BigBasket will use technology to handle inventory.

Around 400 items, identified as household essentials, will be eligible for the above.

“We realised that about 20-30% of groceries are unplanned and immediate-need purchases, and cannot wait for the next day or even the next few hours,” said cofounder Abhinay Choudhary.

“We’re making investments in infrastructure, facilities, chillers and freezers… and will pay a service fee to the store for providing us the facility,” said chief executive Hari Menon.

Competition for BigBasket

Although BigBasket is the market leader currently in online grocery, established players like Amazon are also catching up to capitalise on the demand for online grocery. Amazon India recently launched Kirana Now, an express delivery platform for grocery in tie-up with local mom-and-pop stores.

Also giving stiff competition are rivals Grofers (backed by Tiger Global) and Local Banya which offer express delivery.

“Delivering in such a short time is a very big opportunity to convert offline shoppers to come online,” said Arvind Singhal, chairman of retail consultancy Technopak. “And since BigBasket is the category leader in the space, they will want to consolidate their position.”