Adopting a digital lifestyle has led to significant transformation in the lifestyles of individuals. Busy schedules, higher disposable incomes and the adoption of smartphones have made food and drink delivery services an increasingly popular choice in urban areas.
Food and drink internet retailing might only currently account for a small percentage of overall retail sales; however, the entry of Amazon and Flipkart could stimulate a much-needed increase in the competition, which will bring both opportunities and threats for the existing food and drink retailers in India. Amazon with Amazon Pantry and Flipkart with Flipkart Supermart finally launched online grocery businesses in 2018.
In 2018, food and drink internet retailing was mainly available in first-tier cities, due to consumers’ higher sophistication and purchasing power here than in secondary regions. Logistical challenges also restricted the growth of food and drink internet retailing at the end of the review period.
Supermarket Grocery Supplies revolutionised food and drink internet retailing in India with its flagship retail brand BigBasket.com.
Due to the growth of food and drink internet retailing, offline retailers have also started to invest in their own online arms. This was exemplified by Godrej’s Nature Basket, which first had an offline presence, and then an online presence.
The inventory-led model is more successful within food and drink internet retailing than hyperlocals. Hyperlocal retailers do not have any inventory of their own; instead, they take the order and buy the products from other retailers, putting it into one package for delivery.
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