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Dukaan steps into e-commerce space to bring neighbourhood stores online

Dukaan aims to help neighbourhood stores face competition from e-commerce giants such as Amazon and Flipkart. It plans to keep its service free initially but would charge stores if they have ask for services such as GST invoices.

March 23, 2021 / 01:19 PM IST
But for many grocery workers, the realization that they won’t be eligible any time soon adds to the sense of being expendable. They have fought a mostly losing battle for hazard pay, which a handful of companies offered in the spring but ended despite multiple resurgences of the vaccine. A year into the pandemic, some shoppers still refuse to wear masks and managers often don’t force them to follow the rules. (Image: AP)

But for many grocery workers, the realization that they won’t be eligible any time soon adds to the sense of being expendable. They have fought a mostly losing battle for hazard pay, which a handful of companies offered in the spring but ended despite multiple resurgences of the vaccine. A year into the pandemic, some shoppers still refuse to wear masks and managers often don’t force them to follow the rules. (Image: AP)

Hungry kya? You now have one more avenue to choose from! Matrix Partners-backed technology startup Dukaan which helped offline outlets to set up online stores has now plunged into the consumer-facing e-commerce space.

Much like Swiggy, Zomato, BigBasket or Amazon, it will allow a customer to place an order by selecting the listed merchants on its website across grocery, fruits and vegetables, food and retail, among other categories.

However, unlike the marketplaces, Dukaan is focussing on neighbourhood stores. It claims to have 1.1 million stores across 500 cities on board under the new segment called Finder.

"There is always a trust between you and your existing merchant. So we are focusing on bridging the gap of technology by offering the tools to your local vendors so that he can start generating orders from you online," Suumit Shah, Co-Founder of Dukaan, told Moneycontrol in an interaction.

"We just want to arm the small merchants so that they can go and fight with Amazon and Flipkart," he added.

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Sales of e-commerce giants jumped after the pandemic but offline stores alleged they were losing out to unfair trade practices by dominant online players.

To bring these stores online, Dukaan has launched a browser where users can fill in their location, select stores and order. Merchants can deliver using options such as Dunzo and ShipRocket, among others.

Shah said Dukan would not control how merchants fulfil the orders. "We are just providing every single technology which is required to set up, run and organise your online store," he added.

The feature which was launched last week saw 300 orders on the first day, according to Shah. Currently, half of Dukaan’s orders are from grocery, fruits and vegetables and the restaurant categories.

To begin with Dukaan isn't charging any commission but the long-term plan is to either make money through subscription or by offering ancillary assistance.

"We may start with subscription, then there will be commissions based upon what kind of users we are going after. If it is a small grocery store then we would keep everything free of cost. But the moment his needs start getting sophisticated for instance he starts asking for GST invoice generation ... so that would be an add-on for which people would pay ... Then there is this whole new segment of the enterprises. There are a lot of legacy brands who have not heard of tech to digital yet ... for example Brijwasi sweets; they don't have an online ordering system. So, for these people there will be a new segment called Dukaan enterprise or Dukaan Gold," he said.

Marketplaces such as Amazon and Flipkart charge suppliers 10%-30% commission. They face allegations of favouring preferred vendors at the cost of smaller players.

One of the biggest pain points of the e-commerce industry has been customer complaints about poor quality and incorrect delivery, which dents their reputation. Dukaan will steer clear of this issue and plans to just be the facilitator, leaving quality issues to the seller.

The website did not seem to indicate if a store delivers in a particular area and whether it was open or shut on a particular day. This reporter placed an order using Dukaan Finder, which was first confirmed but then rejected in a few minutes stating that the service was available only in Shastri Nagar.

According to a recent report by Nasscom and Technopak Advisors, the next wave of growth in the retail segment will be from the online and offline collaboration. Such sales will touch $640 billion by 2030, with the digitally enabled retail contributing 43% the report said.

Dukaan last raised $6 million in a round co-led by Matrix Partners and Lightspeed India Partners.
Priyanka Sahay
first published: Mar 23, 2021 01:19 pm

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