Tuesday 27 January 2015

AaramShop to launch services in East Africa, South-East Asia

Delhi-based AaramShop, which allows customers to shop at local neighbourhood stores via the internet, is planning to enter East African and South-East Asian countries.
The company will find local partners and launch services in these markets through the franchise model.
Last year, AaramShop had launched its services in Pakistan by tying up with Red Bucks Grocery, a company promoted by an ex-Unilever employee in Pakistan.
“We would test the limits of our technology in new markets such as Nairobi (Kenya) in East Africa, Vietnam and Indonesia in South-East Asia and even the UAE through the franchise model. There would be no equity participation and it would be an asset-light model run through franchises,” said Vijay Singh, CEO & Managing Director, AaramShop.
“Like in India, goods are sold on MRP (maximum retail price) in Pakistan and not on recommended price like in the more developed markets. In the past year, we have got 7,000 grocers on our site in Pakistan and have a franchise partner since we cannot own equity in this country.”
In India, it currently has 5,000 grocers registered on its site.
The company is providing them with technology-based solutions to reach out to their neighbourhood consumers.
“We should have 60,000 grocers with us by next year,” Singh said. 

Revenue generation
AaramShop does not charge the grocers for its services, instead its revenues come from consumer goods companies and brands that sell through its site for services such as analytics and advertising.
“We get our money from most of the big FMCG companies such as HUL (Hindustan Unilever) and P&G (Procter & Gamble) for providing services like coupons and advertising on our site,” he added.
AaramShop’s services are mainly restricted to the local neighbourhood ‘kirana’ stores and general trade outlets, not modern trade retailers.
The three-year old home-grown start-up is now planning to raise funds through private equity players.
“We have been waiting to get our business model right and generating funds on our own in the past. But now, we hope to raise ₹36 crore in our first round through PE players,” said Singh.
Apart from grocers, AaramShop has also added local pharmacy outlets on its site.

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