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As against the existing e-commerce model of online companies directly selling to end users, I-Street Bazar has adopted a different business model. Rather than servicing end-customers, the company joins hands with local mom-&-pop retail stores to sell goods through internet retailing. Currently it has over 4,000 such partners in states like Gujarat, Rajasthan and Maharashtra.
"There are around 14 million neighborhood mom&pop stores in India which provides a huge opportunity for us to reach out to end consumers through them. The way this model is getting accepted by the offline retailers, we are looking to join hands with over 125,000 stores in next three years," said Lakshya Malu, co-founder of I-street Bazar.
To fund its future expansion plans, I-Street Bazar is planning to raise money through private equity. The company plans to reach out to private equity and venture capitalists, though it is also open to enter equity markets in near future.
"There are several options for fund raising. However it is yet not decided on whether to go with private equity or angel investors," Malu said.
The company currently has presence in Gujarat, Rajasthan, Madhya Pradesh, Chhattisgarh and western Maharashtra. It is now looking at foraying in regions like North India, Uttar Pradesh, and Andhra Pradesh in near future.
Apart from metros and big cities, the company is also targeting to spread network in small towns and semi urban areas where issues regarding awareness and accessibility of internet and online payments prevail.
"Large number of Indian population still do not use online platforms for shopping due to lack of knowledge, payment related issues and most importantly delivery of the goods. Many e-commerce players are not delivering in small towns. To address these issues we have tied up with regional courier service providers who have strong reach in small cities," said Malu.
According to the company as this model helps conventional mom&pop stores earn more, there has been a steady growth in partnerships with them. I-Street Bazar offers an average 8-10 per cent commission to its partners on each order.
Established in 2014, the company earned a revenue of Rs 70 lakh in its first year of operations. Now, at the end of the third quarter of financial year 2015-16, I-Street Bazar has touched a turnover of Rs 10 crore. Promoters of the company have so far invested about Rs 12 crore.
