This Startup Made Sure Delhi's Grocery Stores Don't Run Dry Of Stocks Amid Pandemic
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When the nationwide lockdown was announced on March 24 to curb the spread of COVID-19, people started hoarding essential commodities, despite repeated clarification from the government that essential outlets such as grocery stores will remain open. Within a few days, some retailers ran out of stock as local wholesalers were unable to deliver the required products.
However, during this never-before-seen crisis before, while some B2B-based startups were rummaging ways to increase their runways, few saw an opportunity to grow multi-fold. One such is Delhi-based MaxWholesale—an e-commerce platform for kirana (grocery) stores to source inventory online and discover price and schemes on various FMCG brands and products for ordering and reselling.
The firm last month raised INR 4.43 crore from existing investors Al Falaj Commercial Investment and Indian Angel Network Fund. The fresh capital came four months after raising $3 million in Series A funding round led by IAN Fund-I and AI Falaj.
In an interaction with Entrepreneur India, Samarth Agrawal, co-founder and chief executive officer, MaxWholesale talks about his journey and shares his expansion plans.
From B2C To B2B
“It is not an idea that we came up. It is an idea that we arrived at,” said Agrawal, who was earlier a stock market trader. Before launching the MaxWholesale in 2016, Agrawal was developing a chat software for retail store owners. The chat software, Get Chat, will help retailers to sell their products in the neighbourhood seamlessly. One of the early adopters to his technology was Rohit Narang, who is now chief operating officer, MaxWholesale. From Narang, Agrawal understood the immediate need of an inventory for retail store owners to order from as they often ran out of products.
“Narang asked me to get rose water, as his stock ended. I went around to find the product in other stores. It is then when I acknowledged the problem,” added Agrawal.
The startup provides an application to retail store owners through which they can choose any products from over 40 categories. Once a retailer orders a product, the team at MaxWholesale accepts it and the order details are allocated to the nearby warehouse. Currently, MaxWholeSale has eight warehouses spread across the city and they are planning to increase it.
The firm with its in-house logistics targets to deliver products in Delhi-NCR region in 24 hours. Once the product is delivered, the retailer will make the payment.
“The idea was to provide as much assortment as possible to customers present in stores,” Agrawal said. The company heavily relies on word of mouth from its customers and utilize media such as short videos and images to onboard more retailers.
Agrawal said on the night lockdown was declared, their order volumes skyrocketed. “We had to stop taking orders for a couple of hours as our app’s server crashed,” said Agrawal.
As the restriction of movement was in place, salespeople were unable to deliver products to the already stressed retail stores. However, to keep the business running, Agrawal on the very night went to the local police station to get e-passes for the delivery executives.
According to him, overnight they saw a nine-time surge in demand, and the average order size went up by three times.
“If a person was ordering goods worth INR 3,000 before the lockdown, he was ordering products worth INR 9,000. The stock value too rose as earlier a person ordered five products, but during lockdown was ordering 15 products,” Agrawal explained.
Even after the unlock, Agrawal believes that they have earned the trust of many retailers and will continue to see steady growth.
“Total trading volume right now is five times to what we were in March,” added Agrawal.
In pre-COVID times, the firm had 8,000 active merchants and had approved 10,000 merchants and was doing businesses around half a million dollars per month. However, now the firm is dealing with 15,000 merchants and is trading worth $2.5 million.
Several FMCG brands have approached the firm to sell their product to retailers.
Future and Expansion Plans
With the help of the recently raised funds, the firm plans to hire more people and increase its inventory to serve a wider range of customers. “Our target is to reach 2 million of the total 10 million urban stores in India. Right now we have 150 brands, but would like to onboard 1500 more brands in days to come,” added Agrawal.
Agrawal said Maxwholesale will soon start their operation in Northern states of Punjab and Rajasthan.
He also said that the team is also excited about Haryana and Uttar Pradesh. “We want to focus on the new consumption habits of north Indian users,” Agrawal added.