BigBasket exceeds 5mn customer benchmark; Can Amazon & Flipkart take its glory away?

BigBasket is finally experiencing a stroke of good fortune after its industry’s poor performance last year. The online grocery company received funding worth Rs.45 crore back in April and now there happen to be rumours that the etailer may merge with its rival Grofers soon. The merger is expected funding goals are not reached. So, the etailer just might have its funds sorted.

Apart from this, the online grocer managed a mega feat this month by crossing the 5 million customer benchmark. To celebrate this big achievement the etailer is offering special prices to customers on a selection of 20,000 products. Offers will last till the weekend.

BigBasket sales & growth

BigBasket processes more than 50,000 orders every day from the 26 cities it is present in. Customers’ monthly purchases have grown from spends of Rs.500-800 to Rs.2,000 and more over the recent 5 years that the company has been in business.

The etailer’s co-founder, Vipul Parekh said, “We currently operate at 99.5 percent fill rate and 99 percent on-time delivery. With our guaranteed order fill rate and no-questions-asked return policy, we are happy to say that BigBasket has become a preferred choice for e-shoppers.”

When it comes to sales the e-grocery firm has seen more than 300 percent growth over the course of the past year. On a monthly basis, growth is continuous at a 10 percent rate.

There are mainly three kinds of purchases serviced by BigBasket. These include –

  • Large monthly bulk grocery purchases
  • Quick deliveries of items like milk and bread
  • Speciality products sourced from local stores or special brands

Path of difficulties ahead

BigBasket might be celebrating now but once Amazon and Flipkart are fully settled in this ecommerce segment, can the former expect the same level of growth and customer preference?

Amazon recently got the green light for its food retail business and Flipkart confirmed that it will be re-entering the online grocery segment soon. US-based etailer Amazon already has grocery services like Amazon Now and Amazon Pantry to offer express deliveries for grocery items. The etailer also has the capacity to meet bulk needs of restaurants and small kitchens. It has committed $515 million towards its food business for a period of 5 years. Amazon is already investing big in its grocery businesses and has partnered with local supermarkets to speed up deliveries.

BigBasket so far has $291 million in the kitty. But, this is quite minuscule when compared to Amazon’s $5 billion commitment towards its ecommerce activities in India and Flipkart’s recently acquired funding of $1.4 billion.

At the same time, we cannot forget that BigBasket has been in online grocery fairly longer and concentrates solely on this online retail sector. The company has displayed extraordinary growth figures so far. Private labels contribute to 35 percent of its sales today and are likely to contribute to 40 percent by year-end.

So, does it have a chance at keeping its title of Indian online grocery king?

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