Food e-tailing seems to be at a nascent stage in
India but some experts are expecting the business to reach Rs 1,000
crore by 2015.
Speaking to FnB News, M A Tejani, managing director, Gits Food Products Pvt. Ltd, observed that food e-tailing business was at a nascent stage. He explained that the e-tailing of processed foods, fruit and vegetables in India was not upto the mark, and this could be attributed to the mentality of Indian buyers. He added that it would take at least five years for the concept to grow in the country.
“E-tailing is a fast way to buy products in the convenience of our homes. However, it is a hit only among bachelors, who do not have enough time to go shopping. But most people in India are still uncomfortable with online shopping, because they do not know to use computers and smart-phones. Moreover, smart-phones are not affordable by all,” he added.
Tejani said, “Besides that, Indians like to see and check their food items before purchasing. Online shopping does not give them the freedom to get a feel of the product. Moreover, at times there may be a delay in the delivery of goods bought online, due to various reasons. In case of foods purchased online, the chances of them being spoiled are high. Customers have to pay through credit or debit cards or cash on delivery, which may be difficult for many.”
Meanwhile, Manuj Terapanthi, managing director, Organic Shop (which deals in organic processed foods online), differs. He informed, “Of course, online shopping is growing in India, and the size of e-tailing in the country is expected to reach Rs 1,000 crore by 2015. Many people now do not have time to go to local kirana stores or retailers to shop for foods. That is the reason online shopping is growing by 20 per cent per annum.”
“In the online shopping space, a great deal of funding is being provided by private equity. Competition is growing, because many big retailers have also started e-tailing, seeing the growth of other online ventures. The major constraints in rural areas are people’s capacity to use the Internet and use smart-phones. However, they now have the buying capacity, and at least one member of every household owns a smart-phone. This would help penetrate the rural parts of India,” he added.
Speaking to FnB News on the condition of anonymity, a top official from BigBasket - one of the biggest online shopping stores in India - said, “E-tailing is expected to grow at the rate of 35-40 per cent in the coming years. In order to compete with the United States, the United Kingdom and other countries in online shopping, we would need to change the mentality of the Indian buyers.”
“A majority of Indian buyers do not trust the process of ordering processed food items, vegetables, fruit, rice and other food items online, and the subsequent delivery of the same. It is this mentality that has to be changed,” he said.
“We started this venture in 2012 in three cities (Hyderabad, Bangalore and Mumbai), and within a year, we plan to start our services in Delhi and Chennai. We will subsequently cater to Pune, Ahmedabad and Kolkata as well. We expect to present in 10 cities in the next three years,” he added.
When quizzed about the difficulty faced in online shopping in India, he recalled, “The initial six to nine months were challenging in terms of building capacity to meet the customer demand. But since its inception, the company has seen demand grow by 25-30 per cent on a month-on-month basis.”
“We get about 2,000-2,500 orders a day or 75,000-80,000 orders a month across the three cities, and the average monthly order size stands at Rs 1,500,” he added.
“We see about 60-70 per cent repeat customers, because they are happy with the service. We do not advertise much to acquire customers. It totally depends on word-of-mouth. Around 45 per cent of our customers come through reference, and 20-30 per cent through online searches and traditional media,” he stated.
Speaking to FnB News, M A Tejani, managing director, Gits Food Products Pvt. Ltd, observed that food e-tailing business was at a nascent stage. He explained that the e-tailing of processed foods, fruit and vegetables in India was not upto the mark, and this could be attributed to the mentality of Indian buyers. He added that it would take at least five years for the concept to grow in the country.
“E-tailing is a fast way to buy products in the convenience of our homes. However, it is a hit only among bachelors, who do not have enough time to go shopping. But most people in India are still uncomfortable with online shopping, because they do not know to use computers and smart-phones. Moreover, smart-phones are not affordable by all,” he added.
Tejani said, “Besides that, Indians like to see and check their food items before purchasing. Online shopping does not give them the freedom to get a feel of the product. Moreover, at times there may be a delay in the delivery of goods bought online, due to various reasons. In case of foods purchased online, the chances of them being spoiled are high. Customers have to pay through credit or debit cards or cash on delivery, which may be difficult for many.”
Meanwhile, Manuj Terapanthi, managing director, Organic Shop (which deals in organic processed foods online), differs. He informed, “Of course, online shopping is growing in India, and the size of e-tailing in the country is expected to reach Rs 1,000 crore by 2015. Many people now do not have time to go to local kirana stores or retailers to shop for foods. That is the reason online shopping is growing by 20 per cent per annum.”
“In the online shopping space, a great deal of funding is being provided by private equity. Competition is growing, because many big retailers have also started e-tailing, seeing the growth of other online ventures. The major constraints in rural areas are people’s capacity to use the Internet and use smart-phones. However, they now have the buying capacity, and at least one member of every household owns a smart-phone. This would help penetrate the rural parts of India,” he added.
Speaking to FnB News on the condition of anonymity, a top official from BigBasket - one of the biggest online shopping stores in India - said, “E-tailing is expected to grow at the rate of 35-40 per cent in the coming years. In order to compete with the United States, the United Kingdom and other countries in online shopping, we would need to change the mentality of the Indian buyers.”
“A majority of Indian buyers do not trust the process of ordering processed food items, vegetables, fruit, rice and other food items online, and the subsequent delivery of the same. It is this mentality that has to be changed,” he said.
“We started this venture in 2012 in three cities (Hyderabad, Bangalore and Mumbai), and within a year, we plan to start our services in Delhi and Chennai. We will subsequently cater to Pune, Ahmedabad and Kolkata as well. We expect to present in 10 cities in the next three years,” he added.
When quizzed about the difficulty faced in online shopping in India, he recalled, “The initial six to nine months were challenging in terms of building capacity to meet the customer demand. But since its inception, the company has seen demand grow by 25-30 per cent on a month-on-month basis.”
“We get about 2,000-2,500 orders a day or 75,000-80,000 orders a month across the three cities, and the average monthly order size stands at Rs 1,500,” he added.
“We see about 60-70 per cent repeat customers, because they are happy with the service. We do not advertise much to acquire customers. It totally depends on word-of-mouth. Around 45 per cent of our customers come through reference, and 20-30 per cent through online searches and traditional media,” he stated.
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