BigBasket Revenue Model | Insights for Startups

Big Basket has changed the way people get their daily essentials like groceries, frozen food, and more. It acts as a supermarket for customers; however, the business model of a delivery giant runs deeper than simply listing products from other sellers.

The grocery delivery giant has changed its operational strategy to support the marketplace model and enter into the private label territory, essential deliveries based on subscriptions. Want to know how Big Basket is changing its operational strategy? It’s important to step back and have a quick look over its success story.

Explore Big Basket’s revenue and business model to know how it works. On-demand grocery service is fast gaining popularity in the Indian market, and the online grocery delivery market is predicted to increase and reach $10.5 billion by 2023. And one of the leading names that hold a considerable share in the market is Big Basket. Let’s explore the Big Basket business model to know how it works, generates money, and more right away.

What is a Big Basket?

Supermarket Grocery Supplies PVT, LTD, trading as Big Basket, is an online grocery delivery service. The Indian company primarily delivers goods and daily essentials found in convenience stores, food supplies, and home essentials. Founded in December 2011, BigBasket has its headquarters in Bangalore, India.

Facts & Figures Helping You to Know About BigBasket

Users: 10 million registered users
The average number of orders on the BigBasket platform: 100000
A number of products available on BigBasket: 20000 products
Total number of brands available on BigBasket: 1000 brands
Number of cities BigBasket operates in 25 cities
The average number of monthly orders fulfilled by BigBasket: Over 1 million
Total amount BigBasket raised in funding: $720 million
The estimated value of BigBasket: $1Billion
BigBasket is available on Android & iOS

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Founded by V.S Sudhakar, Abhinay Choudhari, Ramesh, Hari Menon, and Vipul Parekh in 2011, BigBasket is an on-demand grocery ordering platform. In 2019, BigBasket raised $150 million in funding from CDC Group, Mirae, and Alibaba Group, giving the company a valuation of above US$1 billion.

BigBasket has acquired micro-delivery DailyNinja to consolidate its subscription delivery business. The deal increased the value of DailyNinja to 48 crores in stock. In 2021, the Tata Group acquired the majority of stock (64.3%) in the online grocery market, increasing the market and reaching around ₹9,500 crores (US$1.3 billion).

Big Basket Business Model – Explore How the Grocery Delivery App Works

Grocery shopping was one of the most tedious tasks in the past. Various things must be considered; some include searching for a grocery shop, checking the quality of products, comparing the product prices, and adding the stress of shopping in an open store.

Big Basket has made every process more accessible through its grocery delivery app. It facilitates the purchasing of products from the comforts of customers’ locations. The channelization of the online ordering platform works by buying farm products, fruits, vegetables, and meats as well as managing these stocks in a warehouse.

BigBasket is an on-demand delivery platform for customers, but it spread out into everything from acquisition to logistics and in customer services through subscription-based delivery. Big Basket has two sides of operations: buying personal care products and farm produce while managing the stock in its warehouse in different regions.

The primary focus of the Big Basket is to manage the supply of perishable goods, including vegetables, fruits, and meals for which it ties up with local stores and suppliers. Let’s look at the strengths of the Big Basket business model right away.

Strengths of the Big Basket Business Model

If you aim to create an on-demand grocery delivery app similar to Big Basket, then there are various positive and strong points you can consider; check the strengths of the Big Basket business model.

User-friendly Interface

Provides consumers with an easy user interface to select the preferred products from the list. The company provides various options such as search, add to cart, filter, and more. Users can select products from any of the brands to get them delivered to their place.

Value for Customer Money

The company values every penny of customers. Grocery is a primary requirement for every one of us; hence it becomes crucial to selling quality products at a reasonable price as it’s the only way to reach more and more customers. However, BigBasket has clearly understood it.

Wonderful Customer Service

Customers are king! A business that deals with customers need to provide the best services to customers. And the Big Basket business model helps the company to offer excellent customer services to its customers. It has a feedback, rating, and review system, helping the company improve its service much better.

The company’s techniques for product delivery work great for them, ensuring on-time delivery also without any excuses. The team works towards improving the customer base, helping the company to generate more revenue and sales.

Big Basket Online Shopping – Check How Grocery Delivery App Generate Money

The Big Basket business model is designed in such a way that ensures maximum profit to the company. The grocery delivery company takes care that the shoppers’ money is not wasted; they also make sure to get the perfect service at the right price.

Different revenue streams comprising the Big Basket business and revenue model include Store Sales, Merchandise sales, Sponsored Content, Sales Commission from local retailers, and Delivery Charges. Let’s have insight into the working to know how Big Basket makes money.

Inventory Model

This model has helped the company to gain more profit. Big Basket buys products from big brands in the country, including P&G, HUL, and many more. The product sold on the platform is classified in two different categories, including:

Perishable products;
Non-perishable products.

Address perishable products before they become unusual, while non-perishable products can be delivered within a reasonable timeframe. Although there is a 5% decrease in revenue from perishables, this amount is not significant compared to the overall revenue. The inventory revenue model helps brands to generate more revenue.

Multi-Vendor Marketplace Model

In this model, the platform does not manage any of the stock. It lists different sellers on the branded website. When customers place an order on the site, the site arranges for the products to be delivered from the suppliers to consumers via an internal logistics network.

The model is both a win-win for the businesspeople to get the appended branding of the marketplace, and it helps the marketplace increase as their vendors expand. Few of the top giants like Myntra and Amazon follow this marketplace model.

Hyper-Local Delivery

This is the critical point of the Big Basket model; the primary worry of ordering daily essentials online is the delivery of the products. Most people are worried about whether their product or services will be delivered on time or not. Whether there will be any mishaps or tampering.

However, Big Basket ensures delivery on time; the grocery delivery giant provides perfect delivery of groceries to the customers’ place. The company has tied up with lots of local stores across the country to ensure their customers are provided with on-time delivery.

Big Basket charges 30 from the customers, and it’s the primary reason for a brand to generate profit. Due to successful growth, the company introduced the “same-day delivery” concept, making it easier for customers to get their product delivered on the same day.

Amazing warehousing techniques helped the company maintain good, helping Big Basket deliver perishable products to customers’ doorstep on their demand. Big Basket has bridged the gap between customers and farmers.

Looking for Grocery Delivery App Development?

Big Basket is a leading online grocery player that has changed the grocery marketplace. The Big Basket business model has worked wonderfully and emerged as a key player in the grocery business in India. With many competitors in the market, including Amazon, Grofers, and many other hyper-local models emerging, Big Basket has entered into a Tata group to expand its business.

If you are thinking of portraying an app similar to Big Basket, then the Big Basket business and revenue model is the best one to choose. It provides business owners with more profit and helps them come up with a new business that helps them fulfill the market’s demands. Launch the grocery business online with a feature-rich app solution, have any doubt or want to get a pricing quote, don’t hesitate to get in touch with us at [email protected].

Frequently Ask Questions

BigBasket is one of India's leading online grocery delivery services, offering a wide range of products, from fresh vegetables and fruits to packaged food and personal care items. Customers can shop for groceries through their website or mobile app and have them delivered directly to their doorsteps.

BigBasket follows an online marketplace model where customers can browse through a variety of groceries and order them from the comfort of their homes. The company earns revenue by charging for deliveries, offering subscription services, and partnering with brands for product placement.

BigBasket sources its products from a combination of farmers, wholesalers, and manufacturers. They have partnerships with local suppliers and established brands to offer a wide range of high-quality products. BigBasket also manages its own warehouses for storage and distribution.

BigBasket generates revenue through various channels:

Direct Sales: The sale of grocery products, including fresh produce, packaged foods, beverages, etc.
Delivery Fees: Customers often pay delivery charges, which vary depending on the order size and location.
Subscription Plans: BigBasket offers subscription services like "BigBasket Plus" for premium customers, providing benefits like free deliveries, faster service, and discounts.
Brand Partnerships: BigBasket collaborates with brands for in-app advertisements and featured product placements, generating additional revenue.

BigBasket primarily targets urban populations who prefer the convenience of shopping for groceries online. Their main audience includes:

Busy professionals and working individuals.
Families looking for easy grocery shopping options.
Health-conscious consumers who prefer fresh produce and organic products.

BigBasket focuses heavily on maintaining the freshness and quality of its products. The company has a network of warehouses where fresh produce is stored in optimal conditions. It also uses its own delivery fleet to ensure quick deliveries, especially for perishable goods. Additionally, BigBasket offers a return policy for damaged or spoiled items, ensuring customer satisfaction.

BigBasket operates a sophisticated logistics network, which includes a combination of warehouses, delivery hubs, and a dedicated fleet of delivery personnel. The company uses advanced technology to optimize delivery routes and manage inventory. Customers can track their orders in real-time, and deliveries are usually made within a few hours or at a scheduled time based on customer preferences.

BigBasket stands out in the online grocery delivery market due to:

Wide Product Range: Offering a diverse range of products, including groceries, snacks, dairy, and personal care items.
Freshness Guarantee: A commitment to delivering fresh and high-quality products, especially in categories like fruits, vegetables, and dairy.
Convenient Delivery Options: Multiple delivery slots, including same-day and scheduled delivery.
Technological Integration: Efficient use of technology for inventory management, order processing, and delivery optimization.

BigBasket collaborates with various brands and suppliers for advertising and product promotions. Through these partnerships, the company earns revenue from:

Featured Listings: Brands pay to have their products featured more prominently on BigBasket's platform.
Exclusive Product Launches: BigBasket partners with brands to exclusively launch new products, creating an additional revenue stream.
Marketing Partnerships: Companies pay BigBasket to promote their products, resulting in targeted marketing campaigns within the app or website.

While BigBasket has grown significantly, it faces several challenges:

Logistics and Delivery: Ensuring timely and cost-effective delivery in cities with traffic congestion or infrastructural issues.
Supply Chain Management: Maintaining the freshness and quality of perishable goods, especially in hot and humid climates.
Customer Retention: Competing with other e-commerce platforms and new entrants in the grocery delivery market requires continuous innovation and customer satisfaction.
Pricing Pressure: Offering competitive prices while maintaining profitability can be a challenge, especially with delivery fees and warehouse management costs.

Deep Faldu – CTO
Author

As the Chief Technology Officer, Deep Faldu spearheads innovation at White Label Fox, ensuring seamless, scalable, and high-performance app solutions. His technical expertise, problem-solving skills, and commitment to excellence help businesses thrive in the competitive digital landscape. He continuously explores new technologies to enhance product efficiency and user experience.