Grofers Shuts Down Operations In 9 Cities; Says The Market Isn’t Ready Yet

Grofers has shutdown operations in 9 cities including Ludhiana, Bhopal, Kochi, Coimbatore and Visakhapatnam. Grofers is unable to break through the ‘mom-and-pop’ store over there.

List of cities include

  • Bhopal
  • Bhubaneshwar
  • Coimbatore
  • Kochi
  • Ludhiana
  • Mysore
  • Nashik
  • Rajkot
  • Vishakhapatnam

“We ran a series of marketing campaigns including television ads in these cities to test the markets and see if the volume picks up. The smaller cities are not ready for hyperlocal business yet, once they are, we will reconsider our strategy” says Grofers founder, Dhindsa [source].

grofers

Recent development at Grofers:

  1. Grofers CTO has quit.
  2. Grofers is under a lawsuit (by real estate portal, Groffr) over the brand name
  3. Grofers recently raised $120 million in funding from Japan’s SoftBank, Yuri Milner and existing investors Tiger Global and Sequoia Capital.

5 comments

  • Unlike in the US, Indian scenario is different and people have convenience of mom and pop store close to them. In most cases a mom and pop store is within 100 mts of your house and you have a personal relationship with the store guys. By the time you login and order on-line, you could walk across and pick-up stuff. The value proposition has to be very huge to break that habit.
    Interesting to see what they do with $120m 🙂

  • The business is still on, however, engaging delivery boys, and 10% commission from seller seems not matching each other towards profitability, with a 90-minute delivery promise. This model still can be successful, if the delivery is timed, such that based on customer’s availability at home. If someone is going to be at home, unless they are very aged, mostly people would like to go to shop to purchase most of the time. So, I am reluctant in digesting this idea.

    But, if this idea gets funded to the tune $120m, my hands are itching now to start something more reasonable than this one.

  • Exactly.

    And also most of the mom & pop shops now do the home delivery as well. I am really wondering why would anyone go to these apps & sites and order when they can just make a call to their neighborhood grocery store.

    Also, if you compare the prices, you wont see much difference.

  • More and more you use such app, you will become lazy. You get some exercise and fresh air. Go walk to near by store or mandi. Talk with people, meet friends. See some other stuff you may like to buy. Get some sun, inhale some dust (yes right).

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