Online firms foray into grocery delivery
Social commerce startup Meesho, e-tailers like Snapdeal, Paytm Mall, Perpule and Shopclues as well as food delivery app Zomato, and real estate platform NoBroker have all launched delivery of essential grocery products on their platforms.
What gives?
Cracking the grocery delivery business has always been deemed tough for e-commerce companies. But with people hunkered down in their homes as the country goes through a 21-day nationwide lockdown to stem the spread of Covid-19, several internet firms are tapping into the rising demand for groceries.
Shifting gears
The foray into grocery and delivery of essentials have also been also pushed by local governments which allowed these businesses to get curfew passes to stay operational during the lockdown period.
Fight for survival
Online platforms have seen core earnings drop sharply due to the coronavirus outbreak. To tide over this crisis, startups are exploring other revenue streams to allocate resources, including on-ground workforce and logistics personnel. Read more.
Oyo to furlough staff in US
The news
Oyo Hotels & Homes said it will place an undisclosed number of employees on furlough and temporary leaves in the US and other international markets.
Hit by lockdowns
The SoftBank-backed budget hotel chain vowed that it won’t cut jobs at any location at this time, despite a significant drop in revenues and occupancy rates. The Ritesh Agarwal-led company, which expanded at a breakneck pace to become the world’s third-largest hotel chain with nearly a million rooms in 80 countries, said its staff in India would not be affected.
Online travel portals have been hardest hit due to the Covid-19 pandemic as countries around the world announced lockdowns and airlines halted operations.
ET had earlier reported that startups have begun laying off staff and, in some cases, asked employees to take pay cuts as the coronavirus outbreak roils the hospitality industry. Read more.
Alibaba pumps $50 million into BigBasket
The news
Online grocer BigBasket has picked up $50 million from its existing investor Alibaba as part of a bridge round—an intermediate funding meant to cover short-term expenses as the company looks for a larger cheque.
Why pour money into e-grocers?
The last few weeks have been tough going for players like BigBasket with more consumers wanting to place online orders but unable to find slots. The online grocer is currently operating at around half its daily capacity as it continues to struggle with manpower shortages due to the lockdown. The company had last week said that it would hire 10,000 additional permanent workers to cater to the excessive demand, which is as much as five times that on a normal business day.
While the commitment from Alibaba came through before the coronavirus outbreak, the latest infusion comes at a time when BigBasket needs capital to ramp up its capacity and build infrastructure to cope with an unprecedented demand spike. Read more.
Logistics hurdles hurt small online sellers
The news
A majority of online sellers have shut shop amid the ongoing 21-day nationwide lockdown, according to a survey of 350,000 online sellers conducted by e-commerce logistics firm ShipRocket.
Why is it important?
Less than 1% of small businesses are eligible to sell essential goods online and only one-tenth of these sellers have been able to comply with requirements such as Goods and Services Tax, drug licences and food safety certificates raised by courier companies in order to ship these wares. Even those that have all the documents are unable to ship their goods everywhere, as logistics firms do not service all pin codes. Read more.
Jupiter secures $2 million
Jupiter, the digital banking startup founded by former PayU India managing director Jitendra Gupta, has raised an additional $2 million (Rs 15.2 crore) in a top-up funding round led by British venture capital firm Hummingbird Ventures and US-based Bedrock Capital.
The startup, which is currently in stealth mode, plans to officially launch its flagship product in July.
The valuation
The latest investment values Jupiter at about $100 million, according to Gupta, a 43% jump from the $70 million valuation it commanded in November 2019.
The business
Jupiter will provide savings account, investments and lending services to the salaried millennial population with an income demographic of Rs 50,000 and upwards, in partnership with a large private bank, whose name has yet to be disclosed. Read more.
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