After one-and-a-half years of uncertainty and confusion following a prolonged acquisition acquisition Inc42 Reliance Retail Completes Milkbasket Acquisition, Acquires 96.49% Stake Read more tussle with oil-to-retail giant Reliance Industries Ltd (RIL), subscription-based daily micro-delivery service Milkbasket is finally having its moment in the sun.
The RIL management—which highlighted the eight-year-old Milkbasket’s performance in almost all but one earnings call since the acquisition—is now milking the e-grocer’s assets and laying the groundwork for the Aaidea Solutions Pvt. Ltd-operated company’s complete integration with its e-commerce platform Jiomart.
The e-grocer—whose revenue and the subscriber base have doubled since the October-2021 deal—now fulfils upwards of 200,000 daily orders in 30 cities and plans to expand to the top 50 Indian cities in the near term, according to a Milkbasket employee.
Other than Reliance’s heft, the upswing in Milkbasket’s business can also be attributed to the broader shift in the online-grocery-delivery space. According to a report by Redseer Strategy Consultants, the India’s e-grocery market has shrunk by 17% in the past six months on account of post-pandemic normalisation, directly benefitting kiranas (mom-and-pop stores) and next-day-delivery-service providers.
The next-day-delivery segment has grown to around 7% of the e-grocery market, albeit off a small base. And BBdaily—the subscription arm of the Tata Group-owned e-grocer Bigbasket—and Milkbasket have cornered the 50-60% of this segment in terms of gross merchandise value and orders. This, even as others like food-delivery giant Swiggy’s Supr Daily have had to scale down and rebrand rebrand Inc42 Swiggy Rebrands Subscription Grocery Delivery Vertical SuprDaily As InsanelyGood Read more as Insanely Good.
Milkbasket has a new home in Reliance Retail’s large-format retail stores—typically 40,000-60,000 square feet—like the grocery retail chain Reliance Smart. The idea is simple. During the non-store hours, Milkbasket gets a designated amount of space, say, a couple of tables in these stores. The e-grocer then carries out the crux of its operations—sorting, packing, dispatching, and delivering—between 10pm and 7am.
During the store hours, Milkbasket rosters fewer staff for inwarding and storing milk and fruits and vegetables. The night team can pick other grocery items on the spot from the store’s inventory.
This eliminates the need for the e-grocer to open a new warehouse or store large inventory, allowing it to quickly test out new cities and towns—“even [small cities] like Salem [in the southern Indian state of Tamil Nadu] where no other player has entered [yet]”, said the Milkbasket employee mentioned above.
Milkbasket has 10 warehouses across India, including the northern cities of Gurugram and Noida, and the southern cities of Bengaluru and Hyderabad.