Flipkart is looking to expand beyond what they are best known for and into the groceries space, along with expanding their furniture business in order to outmaneuver Amazon.com as the leader of the Indian online market.
In an interview with Reuters on Sunday, CEO Binny Bansal said, “There’s definitely room to build a profitable grocery business, but it’s hard. That doesn’t mean it’s not possible, but it’s hard.” Currently, Amazon India has already started their grocery services in some parts of the country.
With the current situation thanks to the demonetisation, online grocery shopping has become so much more popular and a larger market. While this will definitely change in time, the need for quick groceries will never really go away. Bansal said that the home-grown e-commerce player to begin with grocery sales next year and scale up operations over a three-year period.
Bank of America Merrill Lynch sees the value of goods sold online in India jumping tenfold to $188 billion by 2025.
Given that majority of India shops online for everything, it’s no surprise that Flipkart is looking into this kind of expansion. In fact, it’s a smart move. Bansal said that while fashion will remain Flipkart’s best-selling category for the next few years, he sees the potential for online groceries to grow just as big as fashion and electronics in the next six-eight years.
This year alone, Freshboxx has raised a round of angel-funding for their fresh fruits and vegetables startup, Amazon has launched grocery portals internationally, with plans to introduce the same system in India. The co-founders of Myntra have also backed agritech startup, DayBox and grocery stores around the country are also looking into further expansions.