The mom-and-pop stores in your neighborhood could start feeling the heat as the online players are treading into their offline territory by setting up kiosks, to enable last mile delivery of food items and other daily needs, immediately on receipt of customers’ orders. While Amazon and Flipkart are already working on these lines, BigBasket, the leader in the online foods is also out to protect its territory. BigBasket is now in the process of opening offline kiosks all over the country.
The startup is planning to go one step ahead and start taking subscriptions for items like bread and milk and begin regular door delivery.
These aggressive steps have to be viewed in the backdrop of Bigbasket having raised $300 million from the Chinese giant Alibaba. It cannot be overlooked that Alibaba already has its own axe to grind since it is keen to fight Amazon in the Indian market.
The offline kiosk project by BigBasket could see thousands of such outlets and a pilot scale operation is already on. To begin with, they may choose large apartment and office complexes to locate these kiosks. It is also working on a project called BB Instant, which will aim at making deliveries within 2 hours of the order being received. This is quite similar to the Amazon Now model that Amazon is trying to build in the same space.
Amazon has used the relaxation in FDI regulations, by permitting 100 FDI in food retail and has floated a separate venture and set up a unit in Pune. In addition, it has also setup 15 fulfillment centres across the country.
Coming back to BigBasket, the startup is trying to ramp up its revenue from Rs 2 billion to Rs 3 billion and even Rs 5 billion by 2019. But it has to keep watching its bottom line since the setting up of offline kiosks could stack up the spends and eat into the margins.