Guptaji, the street vendor, is now online

Gupta ji , as he is popularly called by his customers, has been selling vegetables from his cart in New Delhi’s Bihari Mandi for 15 years.  However, in the last one year many of his customers shifted to buying vegetables online and this was affecting his sales. That was when an acquaintance told Guptaji about BigZop.com , an online grocery store. It is the latest entrant in the world of hyper local players, who are helping small vendors and neighbourhood kirana stores to compete with their bigger offline and virtual peers.

A month after the tie-up with BigZop.com , Gupta ji got back his old customers and the sales increased two-fold. "Initially it was difficult to convince him to get him on our platform but now it has finally turned out to be a success story for both him and us," says Aaditya Goyal, an IIT Kharagpur alumni and founder of BigZop. "We hope to reach 100 orders per day with his support in no time. Our experience with Gupta ji is helping us develop a platform that can be used by people across the country whether they are from cities or villages," adds Goyal.

BigZop.com , which was founded in Gurgaon early this year, started its services by delivering hand-picked fresh fruits and vegetables to consumers’ doorstep at their chosen time within two hours. In four months, the start-up has build technology for hyper local e-commerce and is expanding its services to edibles and household products.

Providing a layer Hyper local is not just grocery, but it represents local buying-selling enabled by internet platforms. Apart from BigZop.com , several players such as  Zopper, ZopNow,  Grofers and Peppertap have launched services in the last one year.

These players help small neighbourhood stores and vendors to compete with the growing e-commerce players, who, backed by technology and private equity funding, are rapidly eating into the market share. E-commerce has changed customer habits. But grocery is a special category to deal with. People need it on a regular basis and it requires specific storing and delivery arrangements. Here the volumes are high but margins are low; and the time taken from order to delivery is an important factor.

In such an environment, hyper local players not only focus on consumer convenience but also ensure that the vendor is insulated from deep discounts that e-retailers often provide. Unlike the hyper locals companies, e-ecommerce players such as Bigbasket.com and Localbanya.com have an inventory-led model and they compete with physical grocery stores.

The intense competition has seen customers changing buying habits multiple times. Mamta Nahar, a housewife in Andheri, Mumbai, uninstalled her Bigbasket app in her phone and moved to PepperTap after she found that the latter was cheaper and it delivered within two hours as compared to the six-seven hour delivery time in the case of the former. "I go to PepperTap even for small ticket size and lesser items when the need is immediate," she added.

Hyper local market takes advantage of existing supply chains by only adding a delivery layer on top of it.

In the process, they provide e-commerce experience to their customers with little investment. Here different companies are trying different models. Some provide on-demand delivery boys (called a roadrunner), from companies such as Zaicus, which ties up with the hyper local platforms and manages their deliveries.

"We are bullish on this market, we have seen the orders pick up for our customers and they are more confident of buying locally. We are expanding our capacity to serve more customers in this segment," says Gaurav Chandel, founder of Zaicus. But the biggest problem in this segment is increasing cost of man power and high attrition.

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