IBEF: March 03, 2021
Flipkart stated on Tuesday that it plans to expand its grocery services to > 70 cities in the next six months in order to capitalize on the country's booming e-grocery market.
The company has expanded its grocery services to > 50 Indian cities, including Kolkata, Ahmedabad and Vellore.
As a result of the planned expansion, customers in seven major cities and > 40 neighbouring cities will now have access to high-quality grocery items, deals, fast deliveries, and the most seamless grocery shopping experience.
Millions of people have switched to e-commerce for their grocery purchases as a result of the COVID-19 outbreak, which has fuelled rapid growth in e-grocery in metros, tier II and tier III cities.
As per RedSeer, a consulting firm, the e-grocery is projected to reach ~ US$ 24 billion in terms of GMV (Gross Merchandise Value) by 2025 from ~ US$ 3.3 billion in 2020. In India, key players in the segment include BigBasket, Grofers, Flipkart, Amazon and Reliance.
Flipkart stated that over the years the company invested heavily to rapidly expand in the grocery market in India and in 2020 the company scale up ‘exponentially’. With the support of Flipkart's dedicated grocery fulfilment centres, consumers in metro cities namely Kolkata, Pune, and Ahmedabad can now enjoy the convenience of Flipkart's grocery service. In the last year, Flipkart Grocery has expanded threefold.
Through a satellite-expansion marketplace model, Flipkart has extended its services to cities outside of metros such as Mysore, Kanpur, Warangal, Allahabad, Aligarh, Jaipur, Chandigarh, Rajkot, Vadodara, Vellore, Tirupati, and Daman.
Flipkart Senior Vice President - Grocery, General Merchandise and Furniture, Mr. Manish Kumar said, “Grocery remains one of the fastest-growing segments, owing to the rising customer demand for high-quality food and household supplies. As a result, we've invested in extending our grocery operations around the country while also bolstering ecosystem partnerships.”
He said, “In the last year, the business has seen a rise in demand for groceries from tier II cities, fuelled by consumers' rising preference for contactless shopping.” The preference for contactless shopping is expected to continue and would set the course of e-grocery space in India, he further added.
Flipkart Grocery has more than 7,000 products available across over 200 categories.
Flipkart’s grocery operations will boost the local food processing industry by connecting farmers to lakhs of consumers through the tech-enabled ecosystem.
Flipkart Group CEO, Mr. Kalyan Krishnamurthy said, “As part of its (Flipkart Group) efforts to improve its role in the growing Indian e-commerce industry, the company is planning to scale up its loyalty program, grocery, and apparel businesses.”
He said, “We want to establish our value proposition in the grocery category, particularly by partnering with the nearly million kirana partners we already have in our community.”
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.