People in India are ordering more groceries and staples online, particularly in categories such as ready-to-eat and frozen foods, as key metros have locked down to contain the spread of Coronavirus.
The Second surge of COVID-19 has been deadlier as the virus rips through the middle class and rural population, which had largely escaped unharmed last year.
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"Since mid-February, categories like packaged foods, i.e. ready to eat and ready to cook, have witnessed a spike of up to 80 percent, frozen foods up to 500 percent, and packaged milk, and milk products 150 percent, said a spokesperson of online grocery firm, Grofers, adding that the ``the demand for grocery and staples has increased by 98 percent.”
There has also been a 25 percent increase in the average ticket size of the purchases, said the company, which indicates two things. One, people are dependent on online commerce more than ever and are resorting to it for things they did not purchase online earlier. Two, consumers are also buying more in terms of quantity, given that they are spending more time indoors.
Grofers claims to have an average ticket size of Rs 2,000, post this increase.
Amazon too said it is witnessing strong demand for groceries and packaged foods, besides health and personal care products, including medical supplies.
Snapdeal said that in the last three weeks, the platform has seen the demand for preventive care supplies such as masks and sanitizers go up.
"We are witnessing a continuous rise in orders for N95 and surgical masks, devices like oximeters and electric steamers. Natural herb and nutrition-based products are trending with a four-time spike in search for kadhas, giloy, amla juice and other immunity-boosting products," said a Snapdeal spokesperson.
As more and more companies continue to allow employees to work from home, the company said that appetite for home essentials is shooting up.
According to Snapdeal, "There is a spike in demand for children items like indoor games, art and craft supplies, fitness products like yoga mats, resistance bands, and food items like dry fruits."
To meet this rise, companies are also ramping up their capacities both in terms of stocks and workforce.
Grofers for instance has recently added over 2,000 people to the last mile and supply chain division and plans to hire 7,000 more.
"We are hiring more delivery partners and creating more capacities to reduce delivery timelines," the spokesperson said.
The growth momentum is driven by ease of supply and better preparedness as compared to the year ago period.
Last year masks, sanitisers as well as staples were repeatedly running out of stock as the country went into a sudden lockdown in March. However, this time the standard operating procedures (SOPs) are in place. For most of the essential items, there are ample stocks and so far there haven't been any reports of a supply constraint.
Grofers also said that over time it had built deeper collaborations with manufacturing, merchant and brand partners, and was confident they have sufficient stocks for all food items.
Snapdeal, too, said it was working in close coordination with its sellers for smooth delivery. The company is also prioritizing the delivery of orders, which users’ term `required urgently’.
In an interaction with Moneycontrol last week, Hari Menon, Co-Founder and Chief Executive Officer (CEO) of BigBasket, said that the company had cut back on the range and had kept only essentials as a priority.
The number of SKUs (stock-keeping units) on its platform was down from 40,000 to 13,000 as the company is cutting back on long-tail and focusing on fast-moving items.
Keeping in mind the surge in the number of orders, BigBasket had also devised a token system. If order slots are not available, customers could get a token that will tell them to log in on a date, a day or two away.
According to a recent report by RedSeer Consulting, e-groceries is expected to account for three percent of India’s grocery market by 2025, amounting to $24 billion in market value.
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