In India's Congested Cities, Delivery Apps Cash In

ETVBHARAT

Local tech companies have poured in billions to set up these nifty logistical networks across big cities, fuelling India's rapid shopping industry.

Transcript

00:00In the heart of Mumbai, workers at a

00:05tightly packed Big Basket warehouse jump

00:08into action when their handheld devices

00:10trill with news of a new order. They have

00:13two minutes to dart past towering aisles

00:15filled with everything from detergent to

00:17carrots to pick and pack a bag of

00:19groceries. At a warehouse managed by

00:22online grocer Big Basket in central

00:24Mumbai employees work with military-like

00:26precision to pull off deliveries in just

00:2910 minutes. Local tech companies have

00:31poured in billions to set up these nifty

00:33logistical networks across big cities,

00:36fueling India's rapid shopping industry.

00:39Growth has been very strong, Big Basket

00:41co-founder Vipal Parekh said, pointing to

00:44forecasts that indicate a compounded

00:46annual growth rate of more than 60%

00:48over the next two to three years.

00:51The reason customers love this is because

00:53one, it removes the pain of planning.

00:54No customer wants to plan, wait for the

00:56orders to get delivered and then wait

00:59for it to see if everything has been

01:00received.

01:01They love the fact that it comes

01:02immediately. They love the fact that they

01:04can get everything that they want and

01:06different products all in one single basket.

01:09And this instant gratification is the

01:11cornerstone of the change in customer

01:14behavior and quick commerce.

01:15The number of people that we have within a

01:16one and a half, two kilometer radius of

01:18any dark store is very high.

01:21So the revenue potential in that catchment is

01:23very high. That doesn't happen in low

01:25population density economies.

01:27The second thing, lack of retail density.

01:30We do not have enough dark stores or

01:33even physical stores per thousand people

01:36in this retail urban catchments.

01:39So this addresses a very large unmet need

01:42today in these economies.

01:44Parekh says, India's quick commerce growth

01:46is partly down to the sheer scale of people

01:48living in tight packed cities within a

01:50roughly two kilometer radius of a dark store.

01:54The third is the fact that we have a very

01:56low manpower cost compared to developed

01:58countries.

01:59This makes it affordable to send somebody

02:01to deliver the order because it's a one-to-one

02:03delivery and to come back and again

02:05deliver.

02:06And these three factors make it far more affordable.

02:09Rinesh Ravindra, a regular user, admits that

02:12they make him lazy but argues that the

02:14convenience is unbeatable.

02:16It's not very expensive to order in.

02:21Generally, even if you order a small cart or

02:24even if you need to pay a delivery,

02:26it's not a very big add-on amount.

02:30You're okay to pay that amount for the

02:31convenience of having things delivered to

02:34your doorstep.

02:34I think the convenience of having everything

02:38in one app as opposed to me going to

02:40different stores, I might have to go

02:42to the local dairy first and then go to

02:46the vegetable guy, go to the grocer, go to

02:48the fruit guy, you know, as opposed to

02:50just sit on the app, just pressing a

02:52bunch of keys and all of it comes

02:54delivered to home.

02:56But yeah, it does make me lazy.

02:59He said that he just press a bunch of

03:01keys and all of it comes delivered to home.

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