New Delhi: Online grocery startup Grofers, which is in talks to raise as much as $150 million from Japan’s SoftBank Group Corp., claims that it is growing faster than larger rival BigBasket, with a 35% share of India’s booming online grocery market. In an interview, Grofers co-founder and chief executive officer (CEO) Albinder Dhindsa said the startup had closed the gap with BigBasket and was set to grow even faster.
“Until a few months ago, they (BigBasket) were bigger than us by 40-50%, but we are growing much faster than them now is what we know," Dhindsa said in the interview.
Gurugram-based Grofers India Pvt. Ltd, which recently completed five years of operations, has grown more than threefold year-on-year and is aiming to touch ₹ 2,500 crore in overall revenue this fiscal. In 2017-18, the company posted roughly ₹ 700 crore in sales.
BigBasket (run by Supermarket Grocery Supplies Pvt. Ltd), on the other hand, is looking to hit a run rate of $1 billion by the end of this fiscal. In a July interview, BigBasket co-founder and CEO Hari Menon said the company was aiming to touch a $1 billion (₹6,865 crore) gross sales run rate by March 2019.
BigBasket declined to comment for this story.
Earlier this year, BigBasket and Grofers had revived merger talks as their investors Alibaba Group Holding Ltd and SoftBank looked to join hands, Mint reported in September.
Those talks have fallen through.
Both the online grocery startups are betting big on their respective private label businesses to capture market share in a business where margins are wafer-thin.
Grofers has 700 products from its own brands that contribute roughly 40% of the overall business.
“Private label goes with our mission of making products affordable and it’s growing 30% month-on-month, faster as compared to our platform growing at 10%," said Dhindsa.
Grofers transitioned to an inventory-led business model from a hyperlocal one about a year ago. It began investing in improving its supply chain and technology, cutting costs, reducing operations in several cities and removing unprofitable products to survive in the intensely competitive grocery business.
Since then, the five-year-old company has seen a turnaround in its operations.