Ola, Grofers ink deal to cross-sell each other's services

Initially, Grofers will make Ola Money as preferred payment solution; firms will cross-sell each other's services

India’s largest taxi aggregator Ola has entered into a strategic partnership with on-demand grocery delivery startup Grofers, sources with knowledge of the deal said.

Initially Grofers will make Ola’s digital wallet, Ola Money, as the preferred payment solution on its platform, along with cross-selling of each other's services to their customers. The source added that there is a planned deep integration which could see technology integration between the two companies and Ola becoming a logistics partner for Grofers.

Both Grofers and Ola were unavailable for comment at the time of writing this article.

“There will be knowledge transfer of the learnings from Ola Store to Grofers apart from integrating Ola Money as their preferred partner. In the future, there could be a logistics tie up between Ola and Grofers which could create synergies and help Ola better utilise its fleet and improve efficiencies,” said the person who did not want to be named.

The partnership with Grofers comes soon after Ola shut Ola Store, it's very own on-demand groceries marketplace. Ola Store was present in three cities across India - Bengaluru, Mumbai and Hyderabad. While the scale of Ola’s grocery business pales in comparison to that of Grofers, the former company will share its learnings.

Ola was building its own grocery delivery service in order to improve the overall efficiency of the drivers on its platform. The idea was that drivers could deliver groceries to customers that made online orders in between trips. This will help them better manage their downtime and also help boost their earnings.

Through the partnership with Grofers, the taxi hailing company could be aiming to achieve the same results, while also opening up an additional revenue stream for the company. 

Grofers, too, could benefit from partnering with Ola by getting logistics support, both physical and technical, across the 102 cities Ola is present in.