Flipkart Plans to Launch Grocery Services in 5 Cities

As part of its expansion strategy in the Indian market after its $16-billion acquisition by Walmart, Flipkart is planning to launch grocery services in five cities by July, beginning with Hyderabad and followed by Chennai, Mumbai, Delhi-NCR and Pune.

In Bengaluru, where Flipkart launched grocery services in November, handles 200-300 orders daily on normal days, and up to 2,000 a day when it ran special offers, as per industry estimates. It is now planning to explore the ‘fresh’ category of fruits and vegetables. Also, the company is expecting to offer steep price cuts on groceries at the beginning and end of each month, similar to the offers made by Amazon India and BigBasket with discounts of 25-50% on groceries.

In February, the global eCommerce major Amazon opened 15 fulfillment centres in Bengaluru, Delhi, Hyderabad and Mumbai to create a specialised network for its hyper-local model, Amazon Now. Amazon Now is reportedly handling more than 2,000 daily orders in Bengaluru.

According to a report published by RedSeer Consulting, the online grocery market stood at $1 billion in 2017. The country's two largest online grocers - BigBasket & Grofers held about 35% and 31.5% market share respectively in online grocery segment, followed by Amazon at 31.2%, as stated in a report by Kalagato. 

Grofers raised $60 million in funding led by SoftBank in March and BigBasket secured $300 million in Series E funding round led by Alibaba. BigBasket is also working closely with Paytm Mall, which also counts Alibaba as a strategic investor.