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Grocery delivery in 45 mins? Swiggy to launch new service, InstaMart

BusinessToday.In     August 10, 2020

Food delivery startup Swiggy is planning to launch InstaMart to deliver grocery and household items. InstaMart, a chain of virtual convenience stores, will deliver grocery and household items within 45 minutes. Swiggy is planning to offer about 2,500 items from its partner 'dark stores'. These dark stores will not have walk-in locations and will exist only in apps, the daily added.

According to a Swiggy, there are about 10 dark stores of 1,800-2,500 sq ft in Bengaluru, covering 85-90 per cent catchment areas within a 5-6 km radius. The average basket size for grocery top-up business is close to Rs 400-450.

"We are currently testing Swiggy Instamart to see how it augments our consumer promise of enabling unparalleled convenience by making grocery delivery more instant and delightful," Swiggy said in a statement.

Initially, Swiggy Instamart is available in Gurgaon and can be accessed through the 'Instamart' tile within the Swiggy app. It will run in Bengaluru subsequently.

Swiggy is not a new entrant in the grocery-delivery business. Swiggy has been doing grocery delivery for over 12 months.

In February 2019, Swiggy launched its 'Swiggy Stores' feature that was aimed at delivering daily essentials including groceries to customers. However, during the pandemic, the Bengaluru-based firm revamped its 'Stores' into the 'Grocery' section.  With this, it started delivering groceries and essential items in Tier-1 and Tier-2 cities to help people staying indoors.

Swiggy has tied up with various offline retailers including Vishal Mega Mart as well as fast-moving consumer goods (FMCG) brands such as Marico for grocery service.

Swiggy Stores will continue its services despite InstaMart's launch. InstaMart will address the unmet grocery needs of the 'time-pressed' and 'convenience-seeking' consumer. Moreover, InstaMart will offer day and night services (7 am-12 am) across categories such as instant ice-creams, fruits, vegetables among others.

"With the fastest deliveries in the segment (30-45 minutes), day and night serviceability (7 am - 12 midnight), a wide assortment across categories such as instant meals, snacks, ice creams, beverages, fruits and vegetables, Instamart will address the unmet grocery needs of the time-pressed, convenience-seeking urban consumer," Swiggy added.

Meanwhile, Swiggy's rival Zomato has started downscaling the grocery delivery service in many cities as the economy has begun to reopen.However, Swiggy's InstaMart will face tough competition from existing players into this business such as Amazon, BigBasket, Dunzo, Reliance JioMart, and new entrant Flipkart Quick.

JioMart started its operations in May this year with grocery and food items only. It has reportedly become the largest e-grocery in the country with 400,000 daily orders. Recently, Flipkart announced the hyperlocal delivery service 'Flipkart Quick', which will also offer 90-minute deliveries of groceries. Besides, Amazon, BigBasket, and Grofers have also expanded grocery-delivery business amid the coronavirus pandemic.

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