What Lies In BigBasket’s Future?

The recent acquisition of Flipkart by Walmart has drawn significant attention to the Indian e-commerce market. Forrester estimates that the online retail market in India will grow at 29.2% annually over the next few years to cross $73 billion in 2022. Another report by researcher Crisil estimates that online grocery shopping will be among the fastest growing segments in India. Crisil projects online grocery to grow between 65-70% annually over the next few years to $28 billion by 2020.

BigBasket’s Offerings

Bangalore-based BigBasket was founded in 2011 by Abhinay Choudhari, Hari Menon, VS Sudhakar, VS Ramesh, and Vipul Parekh. Prior to setting up BigBasket, the founders had set up another Indian ecommerce player Fabmart.com and online grocery business called Shop As You Like. After selling Fabmart.com to the Aditya Birla Group, the founders focused attention on the grocery business and came up with BigBasket.

BigBasket’s main value proposition was to provide the Indian consumer the ability to choose from more than 20,000 products in fruits, vegetables, groceries, and toiletries. It allowed consumers to schedule deliveries either on a weekly basis or to make emergency purchases. It even tied up with neighborhood specialty stores to allow them to top-up purchases through express delivery. Today, BigBasket has become the largest online grocer in the country. Its operations are present in 30 cities across India and processes a monthly gross merchandise value of Rs. 200 crores (~$295 million). It plans to increase that rate by 2.5 times by the end of the next year.

To drive growth, BigBasket has also been investing in private labels. Its private labels include Lindberg for chocolates, Fresho for green grocery and bakery, Tasties for snacks, Fresho Signature for cookies, and Happy Chef for gourmet products. It sells its products to more than 1,800 offices, besides hospitals, hotels, and caterers. Currently, its private label line accounts for nearly 34% of its revenues. BigBasket plans to increase that contribution to 45% by 2019.

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Sramana Mitra is the founder of One Million by One Million (1M/1M), a global virtual incubator that aims to help one million entrepreneurs ...

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