The Bengaluru-based technology-led, app-centric startup counts Tamil Nadu among its important markets, with encouraging traction being witnessed on the retail front.
The company’s mission is to enable every town in India to shop online. The start-up has a digital offline network of more than 40,000 retailers, one million customers and facilitates more than 20,000 digital and physical transactions a day. Giving us a lowdown on the company’s business model, Amit Sharma, CEO and Co-Founder of ShopX tells us, “Our primary focus is the retailers."
Unlike other e-com majors, the company does not help retailers sell products which are already in their shop. The company ensures that retailers offer the best experience to their customers. So, they can order from the ShopX app any time based on the demand at their shop and the order reaches them within a minimal time irrespective of where the retailer is located. Most of the time, the retailers introduce their customers to the platform.
ShopX’s proprietary technology, when employed by a retailer, turns his enterprise into a tech-enabled platform. Talking about the company’s presence in Tamil Nadu, Sharma says, “ShopX is present in 19 towns in Tamil Nadu. More than 8,000 retailers in the state use ShopX and we receive more than 1 lakh orders every month from this region.”
Within a short one-year span, the company launched operations across 200 towns in 10 states with an annualized GMV (Gross Merchandise Value) of Rs 60 crore.Sharma says, “We have our retailer base across all the product categories. Our physical product categories include FMCG, mobile phone and accessories, fashion and stationery, while our digital services include: Mobile and DTH recharge, flight and bus ticket booking, utility bills etc. Our app gives retailers an opportunity to earn about 30-40 percent more income. The benefits for the retailer is the low investment as they do not have to invest a lot of money to buy the stock and then maintain them, the retailers can order when they need the product.”
The retailer also has access to new products, services, and platform services (like credit, payments and loyalty). With this approach, the Company is helping to expand the overall addressable digital commerce market size significantly. Strategic investors in the company include Nandan Nilekani, Jagdish Kini (ex- CEO, Airtel (South Region), MD, Gillette India), and Pramod Varma (Former Chief Architect, UIDAI Aadhar Project, CTO Sterling Commerce).
The lure of small retailers
The market space of e-commerce (including m-commerce) remains a small fraction of the overall retail pie (8% in US, 5% in China, and less than 1% in India). Today, ecommerce in India is less than 1.5% of the $650 billion economy. Almost all digital companies are today targeting the same 40-50 million active internet buyers in India. However, there are more than 1.2 crore small retailers in India - the highest number of retailers anywhere in the world, and the highest density of retailers per capita (1 for every 100 people).