 "Bigbasket expects operational break-even by Feb 2017")
Online grocery store Bigbasket is expecting an operational break-even by February next year, except for above-the-line marketing and corporate spends. A complete break-even, claimed the company’s Co-Founder & Chief Executive Officer Hari Menon, is expected between 2018 and 2020.
Speaking to reporters on the sidelines of a human capital management conference by Chennai-based B-school Great Lakes Institute of Management, Menon said, “We are aiming at scaling up with profitability. We will see operational break-even, except for above-the-line marketing expenses and corporate spends, for all eight tier-I cities.”
With a three-million customer base, the grocery portal expects this number to jump manifold to 10-15 million.
With a presence in 25 states, the online grocer is looking at offering place-of-origin products to its customers. It is also looking at padding up its organic business.
Its private label business currently contributes to around 33 per cent. It expects this to go up to 40 per cent over the next 18-24 months. While the average margin for products is 22-23 per cent, on private labels, the margin is 25-40 per cent, depending on the category.
Bigbasket, which recently announced its entry into the business-to-business market, with supply to bulk customers such as hotels and restaurants, expects the ratio between business-to-customers (retail) and the business-to-business to be at around 70:30 over a period of time.
It currently connects 1,100 farmers with around 3,000 acres. It plan to increase the connect to 3,000 farmers and 10,000 acres of agricultural land.