Monday, August 15, 2011

Working Online For Cash | Click To Order Your Greens

Working mothers are now the rule rather than the exception, and the convenience of shopping for your everyday grocery items online is prompting more and more people to the Internet.

For example, Bhavna Thakur, a mother of a two-year-old and deputy manager at Tata Teleservices, has moved to online shopping because she does not have the luxury to visit the local grocery store on weekdays. To cash in on the growing trend a host of e-commerce sites such as Aaramshop, Easyration and Freshndaily, are working on e-grocery business models that adds value for the customer by offering more benefits than costs.

Aaramshop has practically taken the neighbourhood kirana stores to the virtual world. All a customer needs to do is list the items and key in the address. Aaramshop, with its database of over 62 retailers in the national capital region (NCR), tracks a kirana store near you. The model not only helps local retailers to expand their client base, but comes as a relief to many at no extra charge.

To shop online with Aaramshop, one needs to place a minimum order for Rs 700-800 for free home delivery. There is no membership fee for retailers, neither are customers charged a transaction fee. Aaramshop depends completely on advertising revenues. It plans to expand to 400-500 shops in Delhi and may launch its services in Mumbai and Bangalore by next month.

Margins are razor thin in any grocery business, but Pune-based Easydukaan broke even within a year-and-a-half from its launch. Darshan Jawalebhoi, founder, Easydukaan.com, says: "The key to long-term sustainable profits is to achieve higher scales. We are looking forward to the next couple of years to reach sustainability. The idea is to bring onboard local mom-and-pop stores. It is a win-win situation for all those involved - better service for customers, increased availability/reach-ability for existing stores with the modern retail format and increased presence for EasyDukaan. We are also looking beyond groceries with the format."

"We have to keep our margins at 6-7 per cent because prices have to be competitive enough to let people shop online," says J K Thakur, founder of Easyration. The company first launched an order-on-the-phone business model before moving online two months ago.

Thakur hopes to breakeven in the next two months. From a couple of orders a day, sales through Easyration has jumped to over 20 orders, each with an average ticket price of Rs 3,000 -3,500. A promo offer on group buying site, Snapdeal, has also helped the company achieve 75 registered clients. Aaramshop is not behind with an average 25 orders for Rs 800 each everyday.

"The method is very convenient for me. I can order any time, save fuel and money since the items are discounted. Further, by referring people I get to earn points which can later be converted into discounts," adds Bhuwan Chopra, a software professional in Gurgaon. Chopra started placing orders for lesser amounts at Easyration and has now moved on to doing most of his grocery shopping online.

E-commerce sites are also looking at alternative business modes to rope in more customers. Aaramshop, for example, has launched a facebook application that lets one shop on facebook. All one has to do is ‘like’ the page and select the items. The facebook page has over 600 followers.

Easydukaan, standing by its name, is trying to provide the ease of use across platforms. It is working on developing smart phone apps for shopping. In fact, the first prototype of the Android app is almost ready.

Both cash-on-delivery and online payments through credit cards are accepted and working couples can decide a suitable time and place for the delivery of the items. However, people are still sceptical transacting online and about the quality of goods purchased. "I find the system very helpful for my lifestyle. However, I stick to ordering things like daal and sugar, but not fruit or vegetables," says Bhavna.

Kishor and Chandresh, working professionals from Pune, are regular users of Easydukaan. However, they have raised concerns about the site design, which sometimes does not let one to modify the order. Moreover, the lack of some products especially in a larger quantity has put them off.

On the retailer side, there are several broken links as well. The supply chain being completely manual, one cannot process orders automatically or over emails. The deliveries from companies tend to get delayed and availability of goods is unpredictable. Adds Jawalebhoi, "there are frequent changes to packaging, prices, specification of products - most often not communicated to retailers. As a result the cost of maintaining our databases is higher than one would expect."

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