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Business Plan On Online Grocery Business by Deepali Chauhan
Business Plan On Online Grocery Business by Deepali Chauhan
Business Plan On Online Grocery Business by Deepali Chauhan
A
BUSINESS PLAN
ON
ONLINE GROCERY BUSINESS
Submitted in the Partial Fulfilment of the requirement for the Two-Year Full-Time
Masters of Business Administration
(2022-24)
(Affiliated to Dr. A.P.J Abdul Kalam Technical University Lucknow, Uttar Pradesh)
1
2
DATE………………………
I wish him/ her all the best for his / her endeavors.
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ACKNOWLEDGEMENT
I would also like to thank for his invaluable encouragement and help in the successful
completion of my project.
DEEPALI CHAUHAN
4
PREFACE
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DECLARATION
I HEREBY DECLARE THAT THE MINI PROJECT REPORT TITLE “BUSINESS PLAN
FOR ONLINE GROCERY BUSINESS” IS THE OUTCOME OF MY OWN EFFORTS
UNDER THE GUIDANCE OF MR. SHREY TYAGI (FACULTY GUIDE). THE SAME
REPORT HAS NOT BEEN SUBMITTED EARLIER TO ANY INSTITUTE /UNIVERSITY
FOR AWARDING ANY DEGREE/ DIPLOMA OF MBA OR ANY OTHER PROFESSIONAL
COURSE. I FURTHER DECLARE THAT THE INFORMATION PRESENTED IN THIS
MINI PROJECT REPORT IS TRUE AND ORIGINAL TO THE BEST OF MY
KNOWLEDGE.
DEEPALI CHAUHAN
( MBA SEMESTER-1)
6
TABLE OF CONTENT
1 INTRODUCTION 8
6 MARKET PROMOTION 30
12 BUSINESS EXECUTION 43
13 BIBLIOGRAPHY 44
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INTRODUCTION
Our business idea is all about web based. We would like to provide services to people with a
view to making their day-to-day life more comfortable and easier. We will provide customers
with grocery items. And provision of these goods will be done through web in the form of e-
commerce. Our business will be beneficial for people who want to avoid the rush of shopping
malls, traffic, etc. People can order us through web and thus we’ll be able to know their
demands, wants, etc. Then we’ll be able to act accordingly. Customers can check samples of the
products they want in the web. We’ll receive orders and then will take every step to provide them
the goods. Our services will save a lot of time of the customers. The ultimate goal of our
business plan is to ensure customer satisfaction.
This report is prepared for Hierank Business School, Noida as a partial requirement of the
course. Our course instructor has assigned to the students of MBA, to make report on “Business
Plan”. This report is prepared during the 1st Year and would be submitted in the same yearr. The
standard procedure for the long, formal report is followed here as part of the instruction of the
course instructor.
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DESCRIPTION OF VENTURE
ONLINE SHOPPING
Day by day online shopping concept is developing by region in the world. The idea of online
shopping was found few years ago and statistic show people are doing their shopping more than
50 percent online. Flipkart, Snapdeal, EBay and Amazon have been running successful business
in the world. Last two or three years many companies have launched online shopping facility.
One can browse product in their website and choose then have to give order and have to choose
one’s payment option. After making payment they will send the order product in one’s address.
Few numbers of reasons behind the necessity of online shopping in India are the following,
a) Improved productivity: Using e-commerce, the time required creating, transferring and
process a business transaction between trading partners is significantly reduced.
b) Best bargain: It is possible as one can visit numerous shops /suppliers
c) No national boundary: As one can order products from any place within the national
territory.
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d) Easy payment system: Making payment is easy.
e) Streamlined business process: Use of internet and with automation of business process
can make business more efficient
f) Saving time and cost: The cost savings stem from efficient communication, quicker
turnaround and closer access to market.
g) Better Customer service: Customer can enjoy the convenience of shopping at any hour
and anywhere in the world.
h) Variety: The choices one can get for products are amazing. One can get several brands
and products from different sellers at one place.
Simplicity and usability must be your top goal while running a Grocery e-commerce platform.
Ensure to keep these strategies in mind while developing your online grocery store and upscale
your revenue.
Make it easy for customers to register, find the required products, add items to their cart,
review or edit the order and make payments.
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Make sure you include all relevant product information including high-quality pictures,
and brand names, price, ingredients with nutritional value, allergens, and pack size.
Include expiry dates for every product. For example, if a shopper knows that yogurt lasts
up to three weeks, they will buy extra packets instead of getting one.
Give customers the chance to reorder from their past shopping history quickly and
activate shopping lists where customers can add their favorite products. In more simple
terms, Allow your potential customers to see their buying history and share it with family
or friends.
Ensure fast loading pages in your online grocery store. If your site takes more than three
seconds to load, buyers are more likely to abandon their cart without completing the
purchase.
Imagine your online shopper has spent almost an hour adding products to their cart and finds
his/her Pincode is not eligible for delivery at the final step. In online grocery businesses, retailers
must provide all the important information at the beginning itself.
Ensure to provide information to your customers regarding shipping prices and times, delivery
restrictions, geographical areas included in the service, and other special instructions.
Before customers proceed to checkout options, make sure that every step is labeled clearly and
shoppers know what’s coming up beforehand.
Consider adding information that clarifies customer’s queries, such as “You can modify your cart
in the next step” or “By clicking here, you can process your payment or you can’t modify your
cart afterward”. For example, consider adding order progress like this,
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3) Provide Seamless Navigation
On your e-commerce site, you can easily display multiple product categories than in your brick-
and-mortar stores. If you decide to integrate different categories in your online store, make sure
to organize each section clearly for customers to find what they need.
Enable filter options to customers for sorting items by price, brand, group, review scores,
etc.
Make sure information is easy to understand. You can use bullet points and organize
information like ingredients, then package size, then weight, then expiry date
consistently.
Make sure the “buy” button is clearly visible. Provide checkmark or confirmation options
to clarify users when items are added to the basket.
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4) Guarantee Good Quality Of Products
According to a recent study, customers are more concerned about the quality of fresh items and
worry about the risk of delivery in online food shopping. To help customers overcome these
concerns,
Provide delivery options that preserve your product best in quality. For instance, Refrigerated
lockers, one-hour delivery, and click and collect within a specific pick-up window are some of
the options that help to retain freshness.
Offer detailed information about your fresh products. This means including description along
with freshness labels that helps products to last even after it’s delivery.
Solicit feedback, and customer reviews can play a vital role in improving your order on the
website.
Allow customers to return the products and get their money back when grocery items didn’t meet
their expectations at the time of delivery.
When grocery online shopping, customers wish to get their favorite products right away. Which
is like a nightmare to grocery eCommerce merchants seeking to offer a better user experience.
Retailers can meet user expectations with intuitive features and navigation such as favorite
products, suggested products, or saved shopping lists.
Many customers prefer product filtering options to avoid specific allergens, carbohydrates, fat,
sugar, vegan, eco-friendly, etc in grocery shopping sites. The filter list for grocery items must be
diverse and have essential options that simplify the process of finding products online.
6) Cash on delivery
We want our customers to enjoy the opportunity of paying cash on delivery. Cash on delivery
(COD) is a financial transaction where the payment of products and/or services received is done
at the time of actual delivery rather than paid-for in advance. In India, it remains a popular option
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with internet-based retailers, since it is far easier to set up for small businesses and does not
require the purchaser to have a credit card. Most small businesses prefer cash payment over
credit card payment.
Ecommerce has changed the way people shop for products and services and the manner in which
a business sells its services to the customers. Shopping from an online store is no longer
restricted to a few elites and techno savvy people, as more and more customers are realizing the
benefits of online shopping. From books to electronic gadgets, garments to food items, customers
can purchase anything under the sun from the comfort of their homes and offices.
Some of the advantages that our customer will get through CoD are,
Trust Factor – Some customers have always been wary about paying for a product of
service without actually getting in then and there. The fact that many customers fell
victims to online scams worsened the situation. The Cash on Delivery concept allows the
customers to make the payment only when the product or the services is delivered to
them. This increases the trust factor between the customers and the businesses resulting
in more sales and revenue for the online store. The entire transaction remains transparent
between both the parties under this model.
Easier Transaction Model – In India most online stores depended on Credit Cards and
Internet Banking for payments and transitions. Serving customers using these payment
methods was easy in the developed countries, but in developing countries, many
customers didn’t have access to any electronic means of payment. This is the case in
India. Cash on Delivery has brought this category of customers into the purview of
Ecommerce. Thus, increasing the market size and penetration for the online stores
substantially.
Quality Improvement – The customers pay only when they receive the product and are
satisfied with its quality. They have the right to refuse poor quality products. This has
ensured that online stores need to sell high quality products to the customers resulting in
better quality and customer satisfaction.
Legal Aid – Unless a customer has paid for a product he/she doesn’t have the legal right
over it. This works to the advantage of the online store as this keeps them at bay from
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legal responsibility over late delivery of the product or no delivery due to unavoidable
circumstances. In case, our online store fails to deliver a product we can ask customers
for an alternative product of their choice without having to worry about any monetary
compensation or legal hassles.
7)Return policy
We also plan to provide our customer with 30 days return policy. They can return the product if
it is not satisfactory.
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Creating a contemporary website:
www.godaddy.com
• www.websitedesignIndia.com
e) Financial transactions on the Web- In addition to having access to a secured server,
we will need to design a transactions page that collects the customer’s financial
information, transmits it to a service that can verify the transaction, and stores the
data in our files. The unique feature of the website will be a very user friendly search
engine for the visitors along with multiple categorical options. In addition there will
be places for advertisement where we can put other multimedia flash advertisements
with a payment.
f) Linking the site- We have to link the site with other, already recognized sites
increases the chances of being found by both our prospects and by the search engines.
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Creating a website needs a Systems Development Life Cycle. Five major steps
in the Systems Development Life Cycle are:
1) Systems analysis/planning
2) Systems design
3) Building the system
4) Testing
5) Implementation
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LOGICAL DESIGN FOR THE ONLINE SHOPPING WEBSITE
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COMPONENTS OF A WEBSITE BUDGET
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INDUSTRY ANALYSIS
1) Competition
Competition always makes a business more challenging. Competition motivates and sometimes
compels a business to perform better and better. The most important thing is to identify the
competitors and their natures. In our business we do have related competitors but some business
is flourishing now-a-days in this area. Our competitors are some web based online shopping
business in our country.
There are some websites which provide online shopping option in India but neither delivers the
products ordered nor offer return policy. Rather they charge high cost and are not up to date with
the price and products of the market. They rarely modify the products and prices of day to day
market.
To overcome the competitor’s strengths and advantages we need to focus on time as they had an
earlier entry. We will go for an exposing advertising to ensure the very effective entry in this
entry. If we can attract the customers by massive advertisement through social networking sites
and websites we can be assured of our business increasing.
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In India, Internet services are available in major part of country. In January 2015, the Internet
facilities were extended to all states except some Northeast states and some part of Kashmir. The
internet services expanding very fast and today almost every part of India getting Internet
facilities. Followings are the points of e-commerce in India:
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OPERATIONAL PLAN
1) Business goals
2) Resource requirements
a) Capital investments
Land and Building- An office with 800 square feet will be enough for
primary operations. The office building can be either be rented or
bought.
Utilities- Electricity and power cost should get emphasis which will be
around Rs. 6000 per month.
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Miscellaneous Assets- Other items like office furniture, working
tables in the office, exhaust fans, storage racks and bins etc. are likely
to cost Rs. 40,000/-.
b) Personnel requirement
There should be appointed efficient data entry officers who are expert in technical knowledge of
computers and internet. There should be reliable field workers for delivering the products.
In case of business expansion we will have to collect resource from external means.
4) Products
5) Implementation
a) Order: We plan to make contract with the companies with related products for
five years to supply us with the asked products when they are ordered by our
customers. When customers will order products through our websites it will be
added in our shopping cart software. If they want to take collect on delivery
system then they will have to give their address, number. They can also pay
through credit cards. After getting the selling price we will payback the
company with related products.
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c) Billing: We will bill the product at their market price and will add minor
commissions for delivering.
6) Risk Assessment
b) Supply: Whether the supply and delivery of products be in proper time and
please the customer or not.
c) Technology: Get the help from the latest technology and using it in minimum
cost.
a) Reduce risk: We can get through the demand risk by ensuring quality and
reduced tariff for the advertisers.
c) Plan B- If risks can not be diminished by multiple attempts rather increases then
we will turn our product shopping website into service related website.
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Organization Structure
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MARKETING PLAN
Market potential: Market potentiality means the estimated maximum total sales revenue of
our products in the market during a certain period. For determining the market potential of our
service we first need to identify who are our target markets and then future prospect.
We will serve the people who are from mid income level. We do not have any geographical
barrier as it is a web based business. But we can state it in a different way. Our geographical
expansion will be like that we will be covering areas beyond Noida i.e. other divisions (other
Uttar Pradesh Districts and northern States i.e. Delhi NCR, Bihar, Punjab, Rajasthan, Haryana,
Uttarakhand
Target markets: We are targeting two distinct groups of customers, individuals and
corporate customers
Individuals- The individuals are people who are looking to give a friend, relative a gift or trying
to satisfy his needs. These customers typically do not have the expertise in recognizing the
peaches among the mixture of lemons and peaches nor the time to bargain over the products in
the market. Individuals aging 16-35 are our main concern for electronic products.
Corporate- The corporate customer typically buys electronic products in a large scale from the
manufacturer or from the direct distributor at a lower rate. We will provide same product at the
same rate as the direct distributor does. Moreover we can supply the necessary grocery in case of
special event (e.g. picnic)
Market size: The rapid growth of digital technology is fundamentally changing the world as
we know it. Our business is fully web based and so the number of internet users determines the
potential market size of our product. The internet subscriber base in India (excluding mobile)
currently stands at 15.1% of whole population. However, total desktop/laptops internet users in
India is actually far greater than that number, likely driven by heavy usage in offices, internet
cafes and multiple users accessing the internet from a single household.
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Factors that will affect the potential market size
Culture
Environment
Regulation
Economy
Industry practice
Demography
Trends
Infrastructure
Market Strategy: The marketing strategy will first seek to create customer awareness
regarding the products offered, grow the customer base, and work toward building customer
loyalty and referrals. The long-range goal is to not only dominate the online store business, but
to create an icon brand. Initially we will:
Engage in Web-based marketing for the next year to generate awareness of the website
and product information. Because Internet-based advertising has declined in recent
quarters, the prices for advertising have consequently significantly dropped making the
expenditure more cost effective.
Utilize outdoor advertising, providing general awareness to the public at large and direct
individuals to the company's website.
Product classifications: we will sell two types of product throw our website:
i. Electronic products (laptops, mobile phones, mp3 players, dvd players etc)
ii. Grocery
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Pricing policy: Product pricing is based on offering high value to our customers compared to
most price points in the market. The price of our products (grocery) will considerably be lower
from the market rate as we will collect them directly from the manufacturer. In case of electronic
products we will become business partners or direct distributors of the popular brands so our
price will be slightly lower than that is in the market. We are intended to attract customers to our
website so the overall pricing policy will be as such that it makes our website different from
those of the prevailing web based selling stores. Moreover we will offer better quality and
selection.
Competitive pricing
Affordability
a) Product packaging: We will use sophisticated packaging measures to ensure the safety
of the products (grocery) and in case of electronic products, as the products are already
packed by the manufacturer, we will just use a sticker containing the identity of our website.
b) Distribution policy: We will distribute the products to the customers with our
responsibility. Initially we will only concentrate in distributing the products within the capital
and gradually we will expand our business to other cities.
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Sales Forecast: Our sales will be tracked using the same system that tracks our website visits
and contact requests. We project sales of our product will remain roughly equal throughout the
first year, with both categories rising from 30-50k per month at the beginning of the year to 75-
100k per month by the end of the year.
a) Market penetration
b) Market expansion
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Market Promotion
Press release
Leaflets/Banners
Stickers
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Analysis (SWOT)
1) Strength
Main purpose is to provide better customer service rather than making profit only.
2) Weaknesses
3) Opportunities
The buying process by people without being physically present lowers their
concerns.
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No bargain hassles
4) Threats
Following challenges, which also represent the growth opportunities in the sector are as follows:-
2. Operating losses
Working misfortunes negatively affect the income of an online shopping for food application
business. Lower edges, the disappointment of the clients and the executives of transitory food
supplies, and numerous different things that cause rising working misfortunes.
Toward the start of the business, the working expenses are probably going to be more than the
actual income. Notwithstanding, by consolidating savvy and insightful administration
methodologies and working frameworks, the working misfortunes can be limited to an incredible
arrangement
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3. On time Delivery
Delivery parts of any online business are not efficient and online basic food item delivery
frameworks are no special case. It is on the grounds that depending on conveyance chiefs doesn't
appear to be a vigorous thought. Reliance on a third individual is the base of this shortcoming.
This can be limited by giving preparing and instruction to the conveyance executives.
Moreover, unique awards for great execution of conveyance executives can likewise advance the
correct direct of their obligations also. These little yet shrewd arrangements have a tremendous
effect and may save millions in income for an online basic food item business.
4. Consumer Behavior
The basic food item business is tied in with serving the end customers. To serve them better, it is
fundamental to comprehend the purchaser conduct towards the items they buy the best and even
the User Interface of the versatile application too. The issue with this entire hypothesis is that it
is eccentric.
The entire advertising procedure and business improvement rely upon the flightiness of clients.
In any case, this test can be taken care of productively by using some intricate client conduct and
propensity investigation and can assist you with concocting some worthwhile procedures.
6. Uncertain Prices
Indeed, even physical stores are not safe to this test. The fluctuating cost of staple things can
influence the benefit from a huge edge of online basic food item versatile application business.
Appropriate and feasible administration is needed to confront this test also.
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7. Tech-savvy
Physical retail locations are as yet customary shopping for food objections. The explanation is
the lion's share age gathering of staple customers are not educated or they don't value utilizing
their cell phones for these errands.
In the two cases, expected clients of an online basic food item application are floating away from
it.
8. Inventory Management
Poor stock administration of a web-based shopping application eventually influences the client
experience with the application.
In this way, with the assistance of master versatile application designers, it can get shrewd
computerized stock administration coordinated inside the application. It oversees stock
impeccably as well as makes everything quick and effective.
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11. Customer Loyalty
To construct brand devotion among the clients for online basic food item business then it is
important to keep up the nature of administration. Likewise, dependability projects can likewise
assist with holding the most steadfast clients. Since in an online business, terrible audits and
criticism with helpless client experience can drive on the clients to change to another staple
application.
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ANALYSIS OF COMPETITIVENESS
We have analyzed the current market situation by the five-factor model of Michael Porter. In this
model there are five forces. By those forces we have identified the competitiveness of the target
market. It is the renowned process all over the world to evaluate the appropriateness to enter into
a business.
Within this market we have some strong existing competitors. Such as Flipkart, Snapdeal,
Amazon etc. But as we are going to start with the necessary items, we don't have such type of
competitor. It is a stable business because it is related with day-to-day life. So it is appropriate
business to enter. Exit barrier is also low, so certainly it is an attractive segment of market to
choose.
Threats of new entrants for a business are always true. So we have always risk of those new
entrants. For this business entry barrier is not very high, as a result in that sense it is an
unattractive segment. In grocery business new entrants are always available, but if we can build
ours as a brand name and gain the major portion of the market share, we will certainly be able to
avoid the threat of the new entrants.
We are going to compete with super shops. We have various types of readymade good, in this
field we don't have real substitute products. Other industry such as our Grocery industry can be
substitute product. But as those are not our real substitute product, it is certainly an attractive
market.
Our buyers would not bargain with the price because we are offering in fixed price. As we are
starting from a fixed price it would certainly fulfill the customer demand, because customers are
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always price sensitive. It is also avoidable because the switching cost of our goods would be
much high. Our product would be cheaper than that of super shops.
We are going to launch a new trend of the grocery business. So the suppliers of that field are so
much concentrated and organized. We emphasize on collecting items from diversified groups.
We will collect specific items from specific places. As a result our suppliers are widened in
Dhaka. So, low bargaining power of the suppliers makes the target market so much attractive.
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INDIA ONLINE GROCERY MARKET, BY PRODUCT TYPE
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Process to Start Online Grocery Store
the steps involved in the process to Start Online Grocery Store in India are as follows:
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1) DECIDE DELIVERY LOCATION
One of the major steps in the process to start online grocery store in India is to identify or decide
the area or location of delivery. The reason behind the same is that fresh vegetable and groceries
can only be delivered up to a limited radius. Therefore, one needs to decide the location of the
office, warehouses, and tie-ups with local groceries accordingly.
Moreover, it shall be relevant to state that the factors that need to be considered while deciding a
location are as follows;
1. Geographical Habits;
2. Cultural Habits;
3. Eating Habits;
4. Number of Households;
5. Count of Youth Population;
6. Suburban Families;
7. Educated Population;
8. Urban Families;
9. Older Singles, etc.
In the next step, the applicant requires to firstly obtain business registration for his/ her firm or
company. That means if an individual decides to start a business, then, in that case, he/she
requires to get Sole Proprietorship Firm Registration. However, if partners decide to start a
business, then, in that case, they must apply for a Limited Liability Partnership Registration.
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3) ARRANGE INVENTORY AND STOCK
Usually, there are two ways to maintain and arrange inventory and stock, which are as follows
Further, out the two ways available, the best way suggested is to prepare a list of products that
the owner wants to keep in the warehouse. In the same manner, he/she must tie-up with grocers
who are interested in the multi-vendor business model.
At present, online grocery stores use their capital to fund and cover-up delivery charges. Further,
on average, delivery charges cost around Rs 40 to 50 per delivery.
Also, the best way to deliver groceries at the doorstep is to hire delivery boys with two wheelers.
But for that, there is a need to decide the range of delivery area in a city.
Out of all the steps involved in the process to start an online grocery store in India, this is the
significant one and acts as the backbone for the entire process. The reason behind the same is
that all the goals, expectations, business opportunities are primarily based on the user interface.
Therefore, there is a need for every proposed entrepreneur to invest some good time in the
development of application and website.
As all the orders are delivered at the customer’s doorstep, the business can use COD or Cash on
Delivery as a primary mode of accepting or receiving payments. Also, COD guarantees same-
day payment, however, the same is not the case with different online modes, as in that case, there
is a need to wait for the remittance from payment gateways.
1. Local Newspaper;
2. Pamphlets;
4. Banners;
5. Hoardings;
6. Door-to-Door Visits;
7. Local SEO;
BUSINESS EXECUTION
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The first and foremost task before the commencement of business is licensing the business. We
have to set up the business with the help of capital expenditures. And then these will be
supported by personnel to continue operation and in case of expansion we will get the help from
the external resources. We will continue the research on development of our website through
regular online survey participated by the customers.
When an operational space will be collected by means of rent or buying along with the necessary
equipment and personnel it will be right for us to start the operation. Last but not the least we
have to arrange a good web developer who is ready to develop our online shopping website for
us according to our requirements.
Expected number of consumers for a particular financial year will be estimated, after that time
periods we will compare the projected and the actual number of customers. In case of material
deviations we will find out the reasons operating behind the deviations and find out what is to be
done to overcome this.
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Bibliography
Justdial.com
Wikipedia.com
www.businessplan.org
www.planmagic.com
www.google.com
www.slideshare.com
www.tutorialpoint.com
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