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From Rs 4 Cr to Rs 40 Cr, how this online grocery startup built its private label business

Bengaluru-based Grocery Factory delivers staples and homecare products directly from manufacturers to consumers under its own brand.

The coronavirus pandemic is changing the way we shop, with grocery shoppers suddenly realising the convenience of shopping online and getting supplies in the comfort of their home. This is set to benefit the direct-to-consumer (D2C) services in the long term. Selling directly to consumers also gives brands better control over their supply chain and cuts down on middleman costs. Realising this trend much ahead of time, Arjun Shetty and Karthik Shetty founded Grocery Factory in 2015. The Bengaluru-based startup delivers staples and homecare products directly from manufacturers to consumers, and has also come up with its own brand of grocery products. From rice and pulses to dry fruits and spices, Grocery Factory has it all.

“GF is building India’s first D2C in groceries. We have created the most-efficient supply chain and last-mile delivery for the consumers. Customers pay almost 20-30 percent lessercompared to any brand or competitors, and we still make money. We bring in our experience to give consistency every single time. We also built the direct selling model where customers can sell our products to their friends and family under the GF Partner,” says Karthik. The startup is currently working with 400 farmers, and has been delivering to more than 25,000 customers in Bengaluru.

The beginnings Arjun and Karthik are seasoned entrepreneurs, and have been in the grocery space for over 30 years. Earlier, they built a chain of supermarkets across Bengaluru under the brand Daily Mart. Before this, they worked in the wholesale trading of rice and pulses in Bengaluru, and hence understand the depth of the supply chain, sourcing directly from farms to the agri yards, and have built strong a relationship across the county from various millers over a decade now.

While they tried to take Daily Mart online in 2010, they realised how the market was not yet ready then, and hence they called off the plans and built an offline store. They decided to venture into the online space to become a part of the hyper-local boom and sold Daily Mart for an undisclosed amount to start Grocery Factory in 2015.

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