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Life has become really busy these days. Time is less and lot many things to do. Hence many people opt to order groceries online. The online grocery store business is booming in India, thanks largely to an ever-increasing number of people opting for the convenience of using their smartphones to purchase their groceries online. Start your online grocery business.
This business has deep-pocket players such as Big Bazaar, and Grofers, Big Basket and the recently entered player is Amazon. But this sector has a scope for small players too. It is more specialised to the local area. It can also be for changing the face of traditional Baniyas to online grocery stores.
The total market pie size of online grocery stores in India is $900 M. Many players are fighting for a share of this pie. As per Praxis Global Alliance, this market is expected to grow with a 70% CAGR to reach $7.5 B by 2022.
Now if these figures catch your eye then read on. We have got a complete guide to start your own online grocery store business.
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1. Website Development
First and foremost, to start with is developing a website. This is the main interface between you and your clients. To start with you need to clear out ideas and refine your concepts. These should be in line with the digital formats like any other website.
A good, efficient and functional website can help you save money on multiple fronts including office rent, power bills and staff salaries. This will prove to be a low-cost option as it will be a win-win situation for both you as well as your clients. Do not rush for the website completion. Invest time to think about the website, its layout and web designs.
Identify a good development company that would do justice to your requirements. You must be part of website development right from launch to the time it is on air. Make sure the website is friendly and SEO friendly.
Since this is the first step we suggest, it will give you and your developer time to build a good website while you do other groundwork for setting up the online store. This is a very useful step to Start your online grocery business.
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2. Location or Clients
The first thing to do is to find a location or clients. Identify the location where you want to set up your shop. Identify the eating habits and buying patterns of the people staying in that location. This will help you to identify the items which would sell fast. Keep an eye out for emerging trends.
Let’s do some research about your competitors in the area. All these will help you to allow you to stock fast-moving items in advance and minimize the chance of wastage. Also, identify the type of population in your area. Like the demographic and the working population.
This will help you to project the probable demand for groceries and set up your online grocery business. For example, if the majority of the population is working then you will have demand on weekends or in the mornings.
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3. Develop Backend
Since you have now identified locations and mapped potential customers, then the next step is to find a good warehouse from where you can reach out easily.
Shortlist a space located within your location or as close as possible. This will help you to provide prompt delivery of items. Apart from this way out is to tie up with reliable suppliers and wholesalers.
They will keep you well supplied with the production regular basis. You can negotiate as you would be intending to buy in volume and regularly. You can also identify wholesalers who can stock your warehouse as and when required.
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4. Business Registration
The next crucial step in the whole process is registration of your company. Now there are different options for registration of a company. You can register it as a proprietary concern, or opt for a partnership registration in case you have partners.
A good tax consultant or chartered accountant can help you with the registration and other formalities. He can explain your various tax formalities. Once the registration formality is complete, you can then open a business account at any bank of your choice.
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5. Delivery System
The success of an online grocery business relies heavily on how fast you can deliver the items to your customer’s home/office. Thus, an efficient delivery system becomes a critical factor in the entire process and for the flourishing of business.
Customers here prefer same-day delivery of the grocery and food items. Any delay in the delivery schedules can bring a frown.
However, many times this is not possible solely due to a lack of human resources or the unavailability of vehicles to transport the goods.
Deliveries also tend to come at a vast cost to the company, accounting for nearly 30-40% of the overall business expenses. You also need to think of some customers to provide a very short delivery time which comes at an additional cost.
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6. Method of Payment
COD or Cash on delivery is the best option if your delivery system is in place. This method is also preferred by many of the customers. Your delivery boys can collect the payment for the items they deliver at the time of delivery itself. This will ensure hassle-free cash flow right from the first day.
An added incentive here is that you will not have to wait for the payment as is the case with many online/credit/debit card payment gateways. What’s more, you also get to save on the additional 2.5% deducted by them as transaction fees for facilitating the payment.
However, with the growing digital boom, you should keep options for other payment modes such as credit or debit cards. Even UPI Payment can be a good option.
7. Marketing Plan
Now comes the big step. Once your other steps are set, marketing your online store becomes important. Maybe signing up for a celebrity or different campaigns may be out of your budget.
But you can advertise by Putting an advertisement in the local newspaper, distributing pamphlets, running a social media campaign, sending bulk SMS, putting up hoardings at prominent locations in your locality (if your budget permits), Doing door-to-door visits, Attending society meetings.
You can tie up with society to attract customers by providing some upper-hand discounts. You can provide loyalty points for the purchase of monthly groceries.
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A fast-paced lifestyle, tiring commutes and long working hours are the key factors responsible for a boom in online shopping right from grocery to other items. Online grocery shopping offers a very convenient option for such customers by saving them both the time and the physical effort needed to shop for groceries.
Start your online grocery business become your boss start earning money and help others by giving employment.
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