The biggest lesson that coronavirus has taught the start-up ecosystem is to do more with less, said Founders and CEOs of food and logistic start-ups in a webinar organised by Fireside Ventures and TiE Delhi-NCR. Hari Menon, Founder of online grocery delivery platform, BigBasket, said that COVID-19 adversity has pushed him and his team to think differently. "Our biggest challenge was manpower. When we didn't have manpower to deliver, we had no choice but rationalise our SKUs. From 38,000, we were forced to bring it down to as low as 2,000 SKUs in some cities. However, we upped our productivity by introducing community selling. We got people living in residential societies to consolidate their orders and place one bulk order. This helped us increase our capacity."
Necessity is the mother of invention, said, Vivek Gupta, Founder, Licious. The online platform that sells meat, chicken and sea-food, is known for its express deliveries. "Since we had shortage of manpower we started doing slotted delivery instead of express. Since there was a shortage of meat in the North, as slaughter-houses were shut down, we used Blue-Dart's six hour delivery service to transport meat from Bangalore to Delhi."
Similarly, P.C. Musthafa, Founder, ID Fresh Food, said that the disruption made him realise that his system was not as efficient as he thought it to be. Since people during the lockdown often had to return disappointed, as they could find ID products in stores, they quickly rolled out an online tool called 'store finder'. "Consumers can go on our website, click on 'store finder' and get a list of 4-5 stores in their vicinity, which have stocks. They can also find information of the stores which will home deliver our products to them. The disruption has prompted us to create an online-offline model."
So, how would life for these start-ups be in the new normal? Sahil Barua, CEO, Delhivery, said that while demand will rise in the short-term, there will be a lull in the medium term and companies which are able to sustain the medium-term lull would do well in the long-term. "There is a pent-up demand, which will re-surface post the lockdown, but one needs to be careful in the medium-term as there will be a massive depression and consumers won't consume as much."
Musthafa of ID is cognizant of the likely dip in demand in the medium-term, but he said that it is a great time to innovate. "This is the best time for a fresh food revolution. People will become health conscious and if brands can identify consumer pain-points and innovate, they will succeed."
"Customer appreciation for quality will go up. There will also be an increase in home-cooking, therefore, innovations in fresh food will surely do well," agreed Gupta of Licious. Will Coronavirus impact valuations of start-ups? Kanwaljit Singh, Managing Partner, Fireside Ventures, said that there will be a weakening of valuations in the short term. "The concept of fund-raising and valuations will go back to basics. This is a good time to get the fundamentals of the business right. If you can invest in a sound business model, in the right product and brand, valuations will follow."