SoftBank-backed Grofers not worried about increasing competetion in online grocery space
SoftBank-backedis aiming Rs 5,000 crore revenue in the current fiscal and said it is not worried about the growing competition in the online grocery space, a company official said on Thursday.
The startup will continue to invest in physical infrastructure, technology, and marketing activities to strengthen its presence and make customers' experience seamless, a key factor to stay afloat in the competitive market, he said.
"We are only concerned about our customers and their experiences. We have built a strong business by focusing on the needs of our four million customers. Competition has always been there and it is healthy for the industry even if it is JioMart," Grofers co-founder Albinder Dhindsa said in an interview.
The startup will focus on consolidating its operation in the existing markets, he said.
"There is enough room to grow in the online grocery space. We have not only survived but thrived amid competition," he said, pointing at the online ecommerce giants.
"About half of each dollar that we spend goes into infrastructure like warehousing, supply chain, and building local partners, 20 percent into technology, and the rest into marketing," Dhindsa said.
The company, which had garnered Rs 2, 500 crore turnover in FY19, is aiming at Rs 5,000 crore topline in the current fiscal, he said.
Dhindsa said its Lucknow cluster is expected to become EBITA positive in the next quarter while Delhi and Kolkata clusters are already profitable.
The company has pumped in Rs 100 crore for ramping up its operation and new hiring of 4,000 for its 'Grand Orange Bag Days' sale, Dhindsa said.
"This will help us to onboard 10 lakh additional new customers and attain gross merchandise value of nearly Rs 700 crore in January," he said.
Speaking about the GOBD sale, Dhindsa expects that Grofers will surpass the gross merchandise value of the largest organised offline retailer in 27 cities where the online firm operates.
The company has registered two-fold growth in gross merchandise value in 2019 over the last year, he said, adding that valuation of Grofers also jumped by 2.7-fold to $800 million when it raised $175 million.
The company claimed that 75 percent of its customers are women from the middle class which is a major strength for the firm.
(Edited by Megha Reddy)