BigBasket rolls out specialty food vertical
Aimed to shore up revenues, the new vertical will offer about 20-25% margin compared to thinner margins in the grocery business, a company executive claimed. Initial results have shown positive indications on market demand. We have tied up with over 1,000 stores initially in major cities to start the third vertical,\" Vipul Parekh, co-founder of BigBasket told TOI.
BENGALURU: Online grocer BigBasket is launching a new business vertical specialty foods. The e-commerce company has been running a pilot for this line of business in Bengaluru even as it plans to take it to other major metro cities.
Aimed to shore up revenues, the new vertical will offer about 20-25% margin compared to thinner margins in the grocery business, a company executive claimed.
Initial results have shown positive indications on market demand. We have tied up with over 1,000 stores initially in major cities to start the third vertical," Vipul Parekh, co-founder of BigBasket told TOI.
BigBasket, which runs its core operations on an inventory-led model where it delivers products from large warehouses to shoppers directly, will undertake a marketplace model for specialty foods with these stores on board. The products will come from different stores in various parts of a city but find demand across other cities as well.
Ethnic products e-tailer Craftsvilla, earlier this year acquired PlaceofOrigin.in, an online gourmet food marketplace in a share-swap deal. The retailer also plans to create a similar platform for smaller, speciality food stores from various cities.
Backed by Dubai's Abraaj Group, BigBasket has two key business verticals--grocery business and its own private brands, such as Fresho and BB Royal, which contribute about 33% of the total business.
The speciality food vertical should contribute at least 10% of total revenues over a period of one year," Parekh said. BigBasket competes with the Softbank backed Grofers and now horizontal commerce major Amazon's grocery platform Amazon Now.
BigBasket reported losses of Rs 60 crore for the year ending March 31, 2015 as net sales rose to Rs 170 crore during the same period. At present it operated in about 25 cities fulfilling about 40,000 orders per day, the company said.
It recently started express delivery under which select products are delivered within an hour or two. The speciality foods vertical will roll out with scheduled delivery as these items are usually not required for day to day needs within certain period of time.
BigBasket’s losses treble, sales jump to Rs 170 crore
Online grocer BigBasket’s net losses trebled to over Rs 60 crore for the year ending March 31, 2015 against a net loss of Rs 21.60 crore in a year ago period, as per the latest documents filed with Registrar of Companies.
Earlier in March this year, the company had closed its $150 million fund raiser led by Abraaj Group along with investors such as the International Finance Corporation, Sands Capital, Bessemer Venture Partners, Helion Advisors, Zodius Capital and Ascent Capital.The company is using fresh capital to increase its warehouse capacity and delivery network.