The Vir­tual Bas­ket

Point of Purchase - - RETAIL -

In a coun­try where con­sumers are ac­cus­tomed to se­lect­ing their own toma­toes, Big­bas­, In­dia’s first e-gro­cer is set to change the rules. With a com­mit­ment to of­fer best qual­ity prod­uct as­sort­ment at un­matched prices, de­liv­ered on time at one’s doorstep, it cur­rently caters to the city of Ban­ga­lore and hopes to ex­pand to four other lo­ca­tions by De­cem­ber this year. The founders of Fab­mart and Fab­mall, af­ter a decade, re­turn with e-gro­cery re­tail­ing and once again have the first mover ad­van­tage in one of the largest con­sump­tion cat­e­gory in the coun­try. Hari Menon, Chief Ex­ec­u­tive Of­fi­cer - Big Bas­ shares its cur­rent po­si­tion and fu­ture plans.

Shikha Kr­ishna four de­liv­ery win­dows 7-9 am, 11.301.30pm, 3-5 pm and 7-10 pm, each al­lot­ted to take only a cer­tain num­ber of or­ders daily. “This en­sures that we meet our com­mit­ment for on time de­liv­er­ies and not over­load our de­liv­ery sched­ules,” says he. Or­ders with bill value above Rs. 1000 are de­liv­ered free, else there is a de­liv­ery fees of Rs 20. The web­site is also op­ti­mized for pri­vacy of cus­tomer de­tails and se­cu­rity of on­line trans­ac­tions. Be­sides, a num­ber of cus­tomers pre­fer to use ‘cash on de­liv­ery’ or Sodexho Vouch­ers. So is there a min­i­mum or­der value to be pur­chased from Big­bas­ket? “No, we don’t be­lieve in it con­cep­tu­ally. We do not want to re­strict our cus­tomers, and this is some­thing that we have fol­lowed from our Fab­mart days in 1999,” says Hari. “Cus­tomers can buy only one prod­uct, and we would de­liver it in their cho­sen time slot and lo­ca­tion.” But then “peo­ple don’t buy one prod­uct”, says his ex­pe­ri­ence from Fab­mart. “We have se­ri­ous shop­pers”. To­day the largest seg­ment of Big­Bas­ket’s con­sumer base con­sists of dual work­ing fam­i­lies, who are busy and want their sta­ples to be home de­liv­ered. An­other seg­ment in­cludes moth­ers who can­not leave their babies unat­tended to at home. It is also a pre­ferred choice for work­ing peo­ple who find it con­ve­nient to place an or­der on­line for their ag­ing par­ents. At present Big­bas­ is an ab­so­lute pure-play busi­ness with about 7000 SKUs of ba­sic prod­ucts. It would ac­com­plish its or­der ful­fil­ment and or­der de­liv­ery through ‘hub and spoke’ model, in which a large ware­house is es­tab­lished in a city suburb, which in turn sup­plies to hubs that are within the city. Hari ex­plains, “The cus­tomer or­ders ar­rive at the ware­house and are pro­cessed. They are then seg­re­gated by cus­tomer or­der num­ber and the hub name. There­after it is de­liv­ered to the re­spec­tive hub, from where they are fi­nally de­liv­ered to cus­tomers. To­day, the ser­vice doesn’t have its own ware­house so its back­end is Safal for fruits and veg­eta­bles and Metro Cash and Carry for other prod­ucts. It has three hubs at Yash­wan­th­pur, Ban­nerghatta Road and White­field that cover all ar­eas of Ban­ga­lore.” In the next 3 – 6 months time, Big­Bas­ket would have its own ware­house and would even­tu­ally deal with around 250 ven­dors and 12,000 – 15,000 SKUs. With about 20 de­liv­ery vans at present, the num­bers would grow to 50 that would do the trips be­tween the ware­house, the hubs and the cus­tomer, to en­sure ef­fi­cient flow of the in­ven­tory. In a re­tail cat­e­gory like gro­cery, which is vis­ited by cus­tomers as fre­quent as twice a week, Big­Bas­ket be­ing a pure-play model, has many ad­van­tages over its brick and mor­tar coun­ter­parts. How­ever it has its own chal­lenges that it needs to com­bat for its smooth sur­vival. The big­gest threat that the busi­ness faces at present is in­ef­fi­cient sup­ply chains, where when Big­Bas­ket places an or­der of X num­ber of de­ter­gents with its ven­dor, only X-5 is de­liv­ered. Ac­cord­ing to Hari, “Most of­ten in a reg­u­lar gro­cery shop­ping at a su­per­mar­ket, items com­pris­ing only 80% of one’s shop­ping list are avail­able. For the other 20% the cus­tomer has to go to her corner shop or look for al­ter­nate op­tions, los­ing her time in park­ing, queu­ing up for billing etc. But while plac­ing or­ders on­line, the cus­tomers ex­pect all the prod­ucts in their shop­ping cart to be de­liv­ered on time, as they want to avoid the has­sle of go­ing to mul­ti­ple stores. Hence, to marry the risk of an in­ef­fi­cient sup­ply chain and meet cus­tomer ex­pec­ta­tions in ev­ery or­der is the big­gest chal­lenge that we face at present.” He takes com­pe­ti­tion pos­i­tively, rather en­cour­ages it as he be­lieves that in­crease in com­pe­ti­tion would en­able the whole cat­e­gory to grow. But be­lieves that cus­tomers would be loyal to Big­Bas­ket, “if we pro­vide them Value that in­cludes good qual­ity prod­ucts, at a great price

Hari Menon CEO Big Bas­

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