Bengaluru, NFAPost: Tata Group-owned e-grocery BigBasket has entered offline retail with the opening of its first brick-and-mortar store in Bengaluru on Wednesday.
The store, branded Fresho, sells fresh fruits and vegetables. BigBasket Cofounder and CEO Hari Menon said the plan is to clock Rs 12,000 crore in sales from 800 Fresho stores across 10 tier-1 cities by the 2026 fiscal.
“The penetration of fruits and vegetables in an organised format just doesn’t exist in the country other than in Chennai. We thought there was an opportunity for us,” he said.
The company, in which the Tatas acquired a 64% stake earlier this year, has tie-ups with 20,000 farmers and operates 60 collection centres.
“About 85% of what we sell comes directly from farmers and that piece has scaled up very well for us. We will give access to some 50,000 products through a click-and-pick model, where customers can order online and then pick up the order from Fresho outlets,” Menon said.
The stores are expected to cater mostly to the millions who haven’t tested waters with buying grocery online. “Even at Rs 400 average order value, we will generate money as the gross margins are higher in fruits and vegetables,” Menon said.
The collection centres double up as sorting centres and house an agronomist to guide farmers on increasing the quality and production of crops.
The Fresho stores are equipped with assisted check-out and self-billing counters. Customers can pick items of their choice, and weigh them at the counter. A computer vision system identifies items in the cart and generates bills accordingly.
Menon said that in about a month, BigBasket will roll out an express grocery delivery service that will deliver orders within 10-20 mins. This will be under the brand name BBNow. “We will leverage a three-tier warehousing structure to move goods fast. There are 3,500 SKUs in the fast-moving category largely meant for top-ups,” Menon said.
Asked about business momentum following the acquisition by the Tatas, Menon said it has given them access to Tata Group companies. “We are in the B2B kirana trader business where we supply to about 75,000 kiranas, and we plan to scale that to 6 lakh with Tata Consumer Products. There are a lot of synergies on that front,” Menon said.