How Reliance’s JioMart platform will reshape India’s online grocery market
Reliance Industries has entered India’s online grocery retailing market via a new e-commerce platform JioMart, which started pilot trials last month in Mumbai.
Through JioMart, it is planning to offer more than 50,000 products and connect 30 million offline retailers with more than 200 million households across the nation.
The value chain created by JioMart connects local offline retailers on a large scale with its merchant point-of-sale solution, where it provides user friendly digital platforms for inventory management, customer care services and other services required by the retailers. JioMart plans to bring in electronics and clothing and footwear under its scope in the near future.
The food-and-grocery (F&G)sector is tipped to be the next business battle for online retailers in India. Retailers, both domestic and international, have been proactive in their approach towards the rapidly growing online F&G sector in a bid to capture a large customer base.
GlobalData estimates that the online F&G market in India grew at a compound annual growth rate (CAGR) of 71.2 per cent between 2013 and 2018 and is set to grow at a CAGR of 45.5 per cent during 2018-2023 as the urban working population is rising in Indian cities and retailers are venturing into non-metro cities. This growth is also supported by the rapidly growing mobile internet and smartphone penetration.
RIL’s JioMart eyes the massive potential in online F&G retailing, which is estimated to reach US$9.12 billion in 2023. Reliance is known for its disruptive ideas and business approach, and the same can be said for its latest venture, JioMart.
With its retail wing in cash and carry outlets through Reliance Fresh and Reliance Supermart, and a massive customer base with India’s largest telecom network in the form of Jio, capturing the market is not going to be tough for JioMart.
As a domestic company, Reliance gets the advantage that Amazon and Walmart-owned Flipkart miss due to the new e-commerce regulations to safeguard the interests of domestic offline retailers in the country.”
- Suresh Sunkara is a retail analyst at GlobalData.