How To Start An Online Grocery Store

1. How To Start An Online Grocery Store

2. If you are thinking of starting an online grocery store….. ….there’s this vital bit of statistics: Accenture estimates that by 2020, out of the total retail consumption by shoppers worldwide, eCommerce will get 13.5%. In other words, out of every 7 dollars spent on retail consumption, eCommerce will get a little over 1 dollar. Gold rush. Isn’t it ? Add to it the fact that there’s practically no way you don’t buy grocery – whatever the channel of purchase – you have a promising grocery market. Start An Online Grocery Store

3. And yet, people planning to get into the business of online grocery store often think the market is the same as that of an e-retailers…. …….That’s incorrect. Beyond some superficial similarities the two businesses share, at an operational level, they are entirely different. For instance, an online grocery store deals with items that are perishable in nature, unlike an e-retailer who faces no such risks. As a result, when you are trying to figure out how to start an online grocery store, you must address these issues in a superior manner. So here’s what you’ll need to do before starting a grocery store. Start An Online Grocery Store

4. #1 Understand And Research The Business Online grocery is all about sourcing and delivering within the shortest time possible, given the inherent perishable nature of most of its products. You’ll want to understand what do the local farms produce the most and what do they provide the best – often, these two things aren’t the same. Carefully study and analyze the buying pattern and habits of the geographical area you intend to serve. Since you are dealing with edible items, also understand the local licensing requirements. Here’s an example of Big Basket – An Indian Grocery startup – They are innovating in the Grocery space where they are delivering specialties of one region to another region similar. This is a niche area and yields high profit margins. Start An Online Grocery Store

5. Golden Tip: Some of the products you can source might be organic, grown without harmful pesticides. If you can identify or cultivate a market for such products, you can get better profit margins. Start An Online Grocery Store

6. #2 Identify The Model That Suits You Best As mentioned earlier, the perishable nature of the items you intend to sell offers you some business models that differ in delivery, inventory, and payment terms. The second most question that you need to ask yourself is : Do you want to operate a warehouse of your own or choose to make arrangements for drop shipping, where your brick-and-mortar partner shop will deliver on your behalf ? As you begin to explore this question, your business model will continue getting refined. Let me share an example on how they disrupted the Grocery space : Instacart’s same-day grocery delivery service has disrupted the grocery market. This created opportunities for other startups to tap into online Grocery delivery business.  Instacart has partnered with major brands & retailers to delivery groceries to door step. Start An Online Grocery Store

7. Golden Tip: Some of the products you can source might be organic, grown without harmful pesticides. If you can identify or cultivate a market for such products, you can get better profit margins. Start An Online Grocery Store

8. #3 Ensure Your Suppliers Can Deliver • The biggest criteria to on board any supplier is to ensure whether they can deliver. • The deliverability has multiple factors like : • Stock/Inventory • Serviceable Areas (If they are ready to own the delivery piece) • Warehouse distance • Also a lot of entrepreneurs, think on the lines of Starting an online organic food & vegetable store and delivery service where they look at tie-ups directly with farmers. So, in this case there are multiple checks that you need to follow : • Not all farms follow best farming practices. As a result, their yield is less likely to be predictable regarding quantity, quality, and timely availability.  Start An Online Grocery Store

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