S. P. MANDALI’S PRIN L. N.

WELINGKAR INSTITUTE OF MANAGEMENT

DEVELOPMENT & RESEARCH

SUMMER INTERNSHIP RESEARCH PROJECT (SIRP) REPORT

ON

EVOLVING WAYS OF OMNI-CHANNEL RETAILING FOR PERISHABLES

BY

JAINAM GALA
ROLL NO.: 16

KAVISH JAIN
ROLL NO.: 20

PGDM RM 2020 – 22
TRIMESTER IV

SPECIALISATION: MARKETING
 ACKNOWLEDGEMENT

We want to thank Prin. L.N. Welingkar Institute of Management Development & Research
for  giving us this opportunity of undertaking the SIRP Assignment. 
We are very grateful to our group director, Prof. Dr. Uday Salunkhe, our faculty mentors,
Prof. Ann Mathew under whose guidance we have carried out this  project. We are thankful
of our faculty mentors for helping us out with the research part in  particular and the overall
project in general. Subjects taught us by Prof. Ann Mathew have been helpful in
completing this project. Additionally, we would want to thank all our professors who
taught us in first year. 
We want to thank our Corporate Guide from BigBasket who guided us and explained the 
problem statement to us. Further, we would like to thank our GCL team member, Mr.
Raunak Jain, Ms. Sunaina Salunke and Ms. Sunakshi Vig for contribution to the project. 
Last but not the least we would like to thank the respondents without whose responses we
wouldn’t have been able to carry out our research part.

Thank You,
Jainam Gala
Kavish Jain
 APPROVAL BY FACULTY GUIDE 

Recommended that the Summer Internship Research Project Report titled “Evolving ways
of omni-channel retailing for perishables” prepared by Mr. Jainam Gala and Mr. 
Kavish Jain under my supervision and guidance be accepted as fulfilling this part of the 
requirements for the award of Post Graduate Diploma in Management. To the best of my 
knowledge, the contents of this report did not form a basis for the award of any previous
degree/  diploma to anybody else. 

Date: 09-08-2021 
Signature: 
Name of the Guide:
Prof. Ann Mathew
 TABLE OF CONTENTS

S No Topic Page No
1 Overview of the problem statement 1
2 Overview of the sector / industry 4
3 Opportunity Spaces derived from the Research 6
4 Overview of the research done 7
5 Introduction of the opportunity space 9
6 Prototype of the opportunity space 6
7 Prototype Testing 13
8 Findings and conclusion 18
9 References and bibliography 20
 PROBLEM STATEMENT

EVOLVING WAYS OF OMNI-CHANNEL RETAILING FOR PERISHABLES

OVERVIEW OF PROBLEM STATEMENT

The problem statement was to evolve ways of omni-channel retailing for perishables. Consumers’
expectations of the shopping experience are changing — and retailers are expected to be present everywhere their
customers are. From headless commerce to virtual try-on, here are the technologies enabling a seamless
experience.

Online sales are booming, and digital experiences are shaping people’s in-store behaviours and
expectations. Consumers, long ago content with shopping only in brick-and-mortar shops, today want to
interact with brands through both online and offline channels.
Most of us would be happy to order reliably uniform products, such as toilet paper, frozen vegetables or
canned tomatoes, without choosing them off the shelf. But what about fresh fish, or potatoes? Maybe, if
you trusted the retailer. Tomatoes and avocadoes, though, are probably a step too far. Most people
would prefer to give them a good look-over in person, even a squeeze.
And yet, the growth in online grocery orders — whether for delivery or pick-up — is undeniable. Many
consumers made it over the initial hurdle of establishing which online retailers to work with, and taking
the time to set up an account, during the COVID-19 lockdowns. Now, they appreciate the gains in
convenience and time-saving, and are continuing to shop that way, at least more than they did before.
After carefully evaluating the current activities and the situation, a plan was created to find opportunity
areas and solution.

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OVERVIEW OF BIG BASKET

Big Basket is one of the largest online grocery super markets in India. It was founded in 2011
by Hari Menon, VS Sudhakar, V S Ramesh, Vipul Parekh and Abhinay choudari. It has its headquarters
in Bengaluru. Big basket offers variety of products ranging from fresh fruits, vegetables, Food grains,
oil, masala, packaged snacks, beverages, household supplies, healthcare products. It has more than
20000 products and 1000 brands in its catalogue It has over 10 million customers. Its customers are
working people, students, old people who have no time or energy to go to grocery stores, stand in line
and buy the necessary products. Big basket helps these people to browse through a huge variety of
quality grocery items. Customers can order the required products which will be delivered within 90
minutes for express delivery or next morning for slotted delivery.
• Slotted Delivery: Customers can pick a convenient slot when they want their purchase to be delivered
• Express Delivery: This service can be availed by customers in cities like Bangalore, Mumbai, Pune,
Chennai, Kolkata, Hyderabad and Delhi-NCR. Delivery will be done within 90 minutes
• BB Specialty stores: Big basket has partnership with specialty stores like Karachi bakery. Customers
can request a product from the store which will be delivered within 90 minutes.
Big basket has acquired 100% stakes in milk delivery ventures Raincan and morningcart. It got a
controlling stake in smart vending machine startup Kwik24. The milk delivery service was branded as
BB daily where customers can get milk delivered to their home in the morning everyday through
subscribing for a fee. Big basket has also installed over 100 smart vending machines in Bangalore.
Customers can order through BB instant app and get the products from vending machines. It also
acquired a hyperlocal delivery startup named delyver. It helped to strengthen its delivery system in all
the cities it is operating in.

The company bases its success on the three pillars namely –

A) Exceptional customer focus-
BigBasket offers same-day delivery across a city, 99.3% on time delivery, 99.5% order fill rate
and a no questions asked customer return policy, all of which has contributed to high customer
loyalty and excellent customer feedback. Grocery business in India is a 400-billion-
dollar addressable market of which e-grocery accounts for only 0.1%. BigBasket continues to
scale at a time when many start-ups are cutting down on their operating costs and shutting
operations in many geographical locations
On top of it all, BigBasket compensates a customer every time it is not able to deliver on its
promise thus ensuring that there is consistent focus on raising the bar higher.
B) Wide range and variety of products-
They have more than 40% of their sales coming through their own brands. It operates on a
margin of 25% on other products and over 35% for in-house labels.
BigBasket has further innovated by offering products such as cut fruits and vegetables, a range of
recipe mixes and have recently launched their own bakery in Bangalore that delivers bread baked
to order.

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C) Continuous innovation with the help of technology.  BigBasket has both android and iOS
mobile apps which allow customers to order groceries on the go. Features such as “Smart-
basket” predicts what a customer needs more often and reduces the time-to-order to “within 5
minutes”

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 OVERVIEW OF THE INDUSTRY

The India online grocery market size was valued at USD 2.9 billion in 2020 and is expected to expand at
a compound annual growth rate (CAGR) of 37.1% from 2021 to 2028. The market has gained immense
traction over the past months on account of the changing lifestyle of the consumers, growing
urbanization, and the tech-savvy generation who prefers buying products online. With the growth in
disposable incomes and busier lifestyles, people are increasingly seeking out customizable and
convenient online platforms for grocery shopping instead of walking down to the neighborhood vendors.
The preference for online delivery of grocery products became more visible following the COVID-19
outbreak. With the social distancing standards, consumers are turning their focus to online grocery
shopping, which is not only convenient but is a safer option. The market is projected to witness
significant growth in the years to come. Initiatives such as no contact delivery and online payment have
attracted consumers toward buying their regular grocery from several online platforms, like Amazon,
BigBasket, Grofers, and many more. With the safety concerns encircling coronavirus and a large section
of the citizens working from home, the dependence of consumers on the online platform has increased
significantly. This, in turn, has provided several growth avenues to the market.
The establishment of the new normal in India has pushed every sector to adapt and embrace ways that
prove effective on hygiene as well as safety factors. People need to follow social distancing at public
places and even at retail grocery stores, which takes a lot of their time. On the contrary, consumers
realized that online grocery shopping, along with contactless delivery, not only saves time but is also
safe. Moreover, individuals working from home are trying their best to balance their work and life and
are finding it convenient to order their groceries online with a few clicks from their handheld devices.
The online grocery market in India is being propelled by the ever-increasing internet penetration in the
country, along with an upsurge in digital awareness. With the growing access to smartphones and low
data costs, consumers now prefer an omnichannel shopping experience.
With the government promoting the digital economy framework and digital literacy, the online grocery
market in India is likely to witness a further impetus in its growth. The industry is expected to be driven
by the consumers who stay in Tier-I cities, such as Bangalore, Chennai, Mumbai, and Delhi, who are
more adaptable to online shopping due to the availability of high-speed internet, better adaptability to
mobile devices, and the logistical simplicity. The government is unlocking things in a stepwise manner;
hence the concerns related to the supply chain and workforce are improving to a greater extent. Thus,
factors like convenience, smart shopping, and hygiene concerns are making online grocery shopping the
better choice for consumers.

PRODUCT TYPE INSIGHTS

The staples and cooking essentials segment dominated the market with a share of 33.9% in 2020. This
significant share is attributed to the constant shopping of staples that include flours, food grains, and
cooking essentials like refined oil that are basic requirements of many. In Indian households, lentils
(dal), pulses, and rice are considered staples. Amidst the pandemic, consumers feared that they could
face lockdown regulations at any point in time, therefore they have been stocking up on these essentials.

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The breakfast and dairy segment are expected to expand at a growth rate of 37.6% over the forecast
period. This is attributed to the growing demand for dairy products, such as yogurt, milk, and curd.
These products are a daily necessity for people and have a short lifespan as compared to other products.
Furthermore, these products cannot be stockpiled for a longer period and need to be consumed within a
specific time. 

KEY COMPANIES & MARKET SHARE INSIGHTS

The market is fragmented and characterized by extreme competition amongst the players. Key players
are focusing on growing their market presence by implementing various strategies, such as partnerships,
mergers & acquisitions, and geographical expansion. These strategies help the market players expand
their businesses geographically and enhance their offerings across the national and international
markets.
For instance, in November 2020, Amazon India Pvt. Ltd. commenced the operations of its online
grocery store Amazon Fresh in 4 more cities, namely Pune, Ahmedabad, Kolkata, and Chennai. The
company stated that the service has been initiated in these cities through the expansion of its specialized
geographical network that facilitates ultra-fast delivery services of groceries and daily essentials under
the Amazon Fresh Store on Amazon.in. Some prominent players in the Indian online grocery market
include:
 Amazon India Pvt. Ltd.           
 Godrej Nature's Basket Ltd.  
 Grofers India Pvt. Ltd.
 Paytm E-Commerce Pvt. Ltd. (Paytm Mall)
 Reliance Retail Ltd. (Reliance Fresh)          
 Spencer's Retail
 Supermarket Grocery Supplies Pvt. Ltd. (BigBasket)       
 UrDoorstep eRetail Pvt. Ltd. 

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 OPPORTUNITY SPACES DERIVED FROM THE RESEARCH

After conducting a primary and secondary research the following opportunities were identified based
on the current trends
- Shop on wheels: Through Shop on Wheels, we plan to assemble a fleet of mobile food and
grocery markets that make eating healthy easier for people. The store can be where the customers
are when they are likely to be there.

- Micro fulfilment centres: A physical touchpoint in the form of small stores at a distance of
about 2-3 kms from each other, specifically displaying the perishables.

- Kiosks and Vending machine: small kiosks and vending machines will be installed in malls
where customers can place their orders for groceries and perishables as seamlessly as one places
order in a QSR. This will add greater value proposition as it will save a lot of time and efforts to
visit a supermarket or hypermarket.

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 OVERVIEW OF THE RESEARCH DONE

 Primary as well as a Secondary research was conducted for this project.

 The qualitative data was taken from the virtual meetings conducted with the internal team of Big
Basket, articles, websites and internet videos.
 The quantitative data, was conducted with a pilot survey by preparing a questionnaire and
circulated it among the people from various parts of India
 The target group consisted of people living in Tier 1 & 2 cities.

Through internet, articles and blogs we were able to find following information about BigBasket.
BigBasket is currently at 40,000 orders a day. The main triggers for them would be customer's need for
convenience and superior service, technology, digital connectivity and a more cohesive ecosystem.
BigBasket has effectively used unmatched customer service with large variety of products with constant
innovation using technology.

When BigBasket started its operations, it adopted the ‘just-in-time model’ – wherein not only
unpreserved good but every item was brought against an order. In other words, they were purchased-to-
order. In this model, the delivery boy directly picks up the item from the retailer, and directly delivers it
to the customer.

As the time passed and their business grew, they proceeded to an ‘inventory model’ for most of their
products, and BigBasket now buys products directly from suppliers like – HUL, P&G, farmers, mills,
etc. and then stocks these in their warehouses. And for the revenue generation, BigBasket adds a small
margin to the cost price of the product before vending them.
But BigBasket also sources many of its products locally as well as nationally. Some items like onions,
oranges, apples, etc. are purchased nationally from their major producing locations; while many other
items are sourced locally from ‘mandis’ (markets) or local farmers. This depends on the product and its
surrounding factors.
Big Basket has successfully completed 14 funding rounds and raised $1.02 billion of total
funding till now. They have 10 million registered customers. Big Basket processes 1 lakh order daily
across 25 cities in India.

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Big Basket follows different revenue models.
1.Markup Based
Big Basket procure groceries from farm and other producers and store them in the inventory. They sell
the items through their online portal with a margin and provide home delivery as a value-added service.
2.Production Based
Big Basket procure groceries in large quantity and sell them under private label. The grains are
processed and are packed to be sold under Big Basket’s private label.

3.Subscription Based
Big Basket offers a subscription plan to its customers where the subscribers can get free delivery on
orders above Rs.600 and get priority for delivery slot bookings. This model ensured retention of
customers and more repeat purchase orders from the customers.

BB procures household goods, branded food items, beverages and food grains directly from big firms
for fresh produce, procurement is done from three sources-farmers, vendors and national sourcing
• Farmers- 70% of SKUs-Farmers deliver their produce at a collection centre nearest to their village
• Vendors-20% of SKUs- Exotic fruits and vegetables
• National sourcing-10% of SKUs- for products having more shelf life (Onions, potatoes, etc)

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 INTRODUCTION OF THE OPPORTUNITY SPACE
MICRO FULFILMENT CENTRES-
Looking at our primary and secondary research it becomes clear that the lack of touch and feel while
buying perishables is a big demand gap for the customers who would otherwise buy from online retailers
considering the number of conveniences that are offered. One possible solution to fill this gap would be
to offer a physical touchpoint to the customers allowing them to come and physically examine their
perishables before making the purchase. These would be small stores at a distance of about 3-4 kms
from each other, specifically focusing on the perishables and the other non-perishable groceries would
be operated upon in the background. Customers would then get their merged order of perishables and
non-perishables at the checkout station of the store. They can also opt for getting the products delivered
to their desired destinations. The customer need not queue up to make the payment, they can make the
payment through their mobile phone applications itself.
Prototype of Micro fulfillment centers-

The idea behind providing these small physical touch points would be to merge the convenience of
technology and with the practicality of the brick mortar stores. These would be 2000-3000 sq.ft. stores
laid at the distance of approximately 3-4 kms away from each other. These stores would be equipped
with smart carts that itself has the capability to scan and add products to the virtual cart of the customer
thereby eliminating the long and time-consuming checkout queues and making the experience extremely
smooth. An ideal customer journey in these stores would include a customer to walk in to the store, pick

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out a smart cart, scan the UI code displayed over it and login to their BigBasket accounts. They can then
directly start putting in their products into the cart by either scanning them or manually adding the
product details in the smart cart that would keep a track of all the things the customer is putting in. Once
a customer is done purchasing his products. He can then either leave the cart at specific dock where it
would be collected by one of the employees and delivered to the customer desired location alongside the
other non-perishable items, or he can also choose to take it along with himself in which case the items of
the cart would be assembled into a shopping bag by an employee in the store and give it to the customer
in a matter of few seconds. The receipt will be generated and passed on the customer through his mobile
application itself through where he can pay, or he can also just make the payment by cash directly at the
counter of the store. Since, the store will mainly offer perishables, the time consumed in doing all this
would be extremely less and efficient.

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Customer Journey of the buyer in a Micro Fulfilment Center explained through a flow chart:

Figure 1- Customer enters the store

Figure 2- Login to smart cart.

Figure 3- Add products to smart cart.

Figure 4- Get the order packed and walk-out.

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Figure 5- Pay online.

Benefits:
• Customers will get to physically examine the perishables before buying them.
• Seamless Omnichannel experience can be provided to the customer, hence strengthening the Brand
value and enhancing the customer loyalty.
• We can attract more customers who prefer to buy perishables offline.
• This would allow to generate a more personal relationship with the customers.
• Would allow for a more efficient supply chain.
• Physical touch-points could also provide as a good source of local advertising to the BigBasket
brand.
Challenges:
• Initial investment in rents, floor staff, cold storage facilities, internet of things.
• Selecting the right places at the right distance from each other to maximize customer footfalls.
• Standardization of the experience and the products.

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 PROTOTYPE TESTING

How often do you go for grocery shopping?

8%

31%

46%

15%

Daily More than once a week Once a week Once in two weeks

Since the information required was not very technical in nature and also looking at the scope of the
study and the extent of the target segment, the sampling technique employed is non probability
sampling. With the help of questionnaire that was circulated, the following insights were received.

Analysis:
According to the data gathered by the survey, more than 75% people go for grocery shopping once in 1
or 2 weeks. Hence, it becomes clear that most people won’t be ready to travel very far for such a high
frequency shopping activity. Also, since the frequency is so high, the average ticket size won’t be that
high for an average consumer.

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 How far do you usually travel for buying your groceries

15%

54%
31%

500m-1km 1km-1.5km 1.5km-2km 2km+

Analysis:

How much time do you usually spend for shopping perishables on an average?
8%

39%

54%

0-15 minutes 15-30 minutes 30-45 minutes 45-60 minutes or more

Out of the sample size of 100 participants, more than 80% of the people don’t travel farther than 1.5 kms
to fill their groceries. This gives a rough idea on how far apart should BigBasket be placing these micro
fulfilment centers.

Analysis:
This data clearly shows that more than 90% people of the research participants don’t spend more than 30
minutes while purchasing groceries. This should translate in less time spending in the store and also with
the help of technology this time should come down even further.

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 How important is trust as a factor when buying perishables?
8%

31%

62%

1 2 3 4 5

Analysis:
According to the data collected, more than 90% participants agreed that trust is either an important or
extremely important factor when purchasing groceries. An offline touchpoint would help build that trust
in the minds of consumers in the long run. Which may also make people more open towards buying
groceries online directly from BigBasket.

Would it be convenient if an offline grocery store offered a home delivery service for
the perishables that are hand picked by you?
8%

15%

77%

Yes No Maybe

Analysis:

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About 3/4th of the whole sample size agreed that they would find a home delivery option from an offline
grocery store for the groceries they picked themselves. This indicates that most of the consumers don’t
go out for grocery shopping as the only agenda rather get it done on their way towards other
places/activities.

Do you think an offline touchpoint of an online grocery store will help you build more
trust for buying perishables online?

46% 46%

8%

Yes No Maybe

Analysis:
As discussed earlier, trust is an extremely important factor for shopping groceries for most consumers,
and almost half of the sample size agreed that this trust would later translate into them trusting to get
their perishables online from BigBasket.

Comfortability level with a technologically sound smart store

15%

54%
31%

1 2 3 4 5

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Analysis:
In a world of rapidly evolving technological advancements, it didn’t come as a surprise that more than
80% of the participants conveyed that they were comfortable considering buying from a technologically
sound store for their groceries as it would offer much more convenience compared to any other brick &
mortar store.

How likely are you to be shopping your non-perishables from such a Micro Fulfilment
Center if offered by BigBasket?

15%
23%

62%

1 2 3 4 5

Analysis:
Almost about 85% people from the chosen sample size showed an overwhelmingly positive response to
the idea of BigBasket offering such a service as a Micro Fulfilment Center.

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 FINDINGS

 According to the survey's findings, more than 75 percent of consumers go food shopping once or
twice a week. As a result, it's evident that most people won't be willing to go long distances for
such a frequent buying activity. Also, because the frequency is so high, the average ticket size
for a typical consumer will be little.
 More than 80 percent of the people in the sample size of 100 don't drive more than 1.5
kilometres to get their food. This offers BigBasket an approximate sense of how far apart these
tiny fulfilment facilities should be placed.
 This data clearly demonstrates that more than 90% of the study participants do not spend more
than 30 minutes shopping for groceries. This should result in less time spent in the store, and
with the use of technology, this time should be reduced even more.
 According to the data gathered, over 90% of participants believed that trust is an important or
extremely significant aspect in grocery shopping. In the long run, an offline touchpoint would aid
in the development of consumer trust. People may be more willing to buy groceries directly from
BigBasket online as a result of this.
 For the groceries they chose themselves, about 3/4th of the total sample size agreed that they
would select a home delivery option from an offline grocery store. This suggests that most
consumers do not go grocery shopping as their sole purpose, but rather do so while on their way
to other destinations or activities.
 Trust is an extremely significant component for most consumers when shopping for groceries,
and over half of the sample size agreed that this trust would later translate into them trusting
BigBasket to deliver their perishables online.
 In a world of rapidly evolving technological advancements, it is not surprising that more than
80% of participants indicated that they were comfortable considering purchasing groceries from
a technologically sound store because it would provide much more convenience than any other
brick and mortar store.
 Finally, when asked whether they would be willing to buy from such a Micro Fulfilment store if
offered by online grocery behemoth BigBasket, nearly 85 percent of the sample size responded
positively.

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 CONCLUSION

Based on the findings of this study, we can infer that there is a significant demand for online grocers to
provide an omnichannel experience and thus cater to a larger customer base. Not only would this result
in rapid customer acquisition, but it would also be a significant step forward in BigBasket's long-term
branding. Given the direction of retail's future, technology will play a critical role; we can already see it
happening in the West, with India not far behind. However, human touch and a physical touchpoint will
be equally important in the future of retailing. This brings us to our opportunity statement of providing
Micro Fulfilment Centers (MFC), which is a unique and innovative way of combining technological
advancement with the practicality of physical stores. In our research, we addressed major concerns about
the challenges and opportunities that MFC provides. We'll draw further conclusions based on our
findings.
Because most people do not spend enough time travelling to get their groceries, BigBasket should keep
these MFCs no more than 3-4 kilometres apart from each other, effectively providing consumers with a
store within a kilometre or two’s distance. Also, the store should only offer perishable groceries that
require consumers to touch and feel the product, and the rest of the packaged FMCG products should
only be available through the online channel. This will effectively reduce the amount of time an average
consumer spends in the store and thus does not have to face extremely crowded situations in the store,
making the entire experience more enjoyable. This will also allow us to operate such MFCs in a small
2000-3000 sq. ft. area, lowering associated costs. Another major concern was instilling trust in the
minds of customers; one important way to accomplish this would be to maintain some level of product
standardisation across all stores. Also, another major inference drawn was the fact that the majority of
the consumers don’t go for grocery shopping as their sole purpose but rather do so while on their way to
other destinations or activities, hence, BigBasket should also provide home delivery service for the
handpicked perishables and, if possible, combine it with the consumer's other non-perishable orders to
create a truly omnichannel ecosystem for the consumer. Finally, in order to be future-proof and provide
a seamless experience, BigBasket should invest in ‘Smartcarts.' This will not only help provide an
extremely automated and efficient service, but it will also help reduce manpower costs and make the
entire purchasing process much less cumbersome for the customer.
Our survey concluded with a simple question about whether or not customers would be willing to do
their grocery shopping from such an MFC if it were offered by an online grocery retail behemoth like
BigBasket, and the response was overwhelmingly positive, indicating that this was most likely the right
direction for the company's future development in the grocery retail space.

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