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Only top five hyperlocal grocery startups to survive: Grofers’s Albinder Dhindsa

Consolidation in the hyperlocal grocery delivering space will happen in the next six months and only the top five players will survive, says Albinder Dhindsa, co-founder and CEO, Grofers.

“I think consolidation will happen in the next six months. We can’t expect 10 players in every space will survive. Top two or three players will survive but since grocery is a bigger space, perhaps the top five will survive but consolidation has to happen,” says Dhindsa in an interview with Techcircle.in.

Locodel Solutions Pvt Ltd, which runs Grofers, was founded by Dhindsa and Saurabh Kumar in 2013. The startup has raised $165 million in three rounds of funding. It recently raised $120 million in fresh funding led by Japanese internet conglomerate SoftBank Corp.

The hyperlocal grocery delivery space has seen the entry of several players such as PepperTap and ZopNow which have an online marketplace model. Inventory-led firms such as BigBasket, LocalBanya and EkStop, a Mumbai-based startup which was acquired by Godrej Nature’s Basket, can also be counted as Grofers’ rivals in this space.

Grofers started off as a B2B delivery service, delivering for more than 1000 merchants across Delhi, before transitioning into a B2C platform.

“We realised there was a huge opportunity to bring these merchants online. We thought we should build a platform to bring them online because these smaller merchants were really afraid of e-commerce,” says Dhindsa.

Currently, the company has more than 12000 sellers across 26 cities and it completes more than 35,000 orders daily. The company deals in groceries, baby care products and cosmetics, sports goods and phones.

It also plans to enable delivery of medicines in the long run. “We want to offer medicines on our platform too, but there are some government regulations around it that are still unclear. I think it is a very strong usage category which needs to be online and a lot of consumers call us and ask us about that. This is a market which needs to come online and once we are clear on government regulations, we will also start doing it,” he says.

Grofers is currently available on Android and iOS apps on mobile phones and Dhindsa says that the company plans to continue with its app-only mode.

“We never even built a website, we have never had that intent. We don’t even have web developers, so I don’t think we can do anything about it,” quips Dhindsa.

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