Paytm aims to bag ₹100 crore daily from grocery segment

Mobile commerce and payments firm Paytm has entered the grocery segment.

The company, which is currently test-marketing the model in Bengaluru, plans to roll it out in at least 10 cities this year, and is hopeful of clocking transactions worth ₹100 crore a day by this year-end. The company plans to reach 10,000 transactions in the grocery space in the first few months of the launch itself.

Next big segment

Paytm’s Founder and CEO, Vijay Shekhar Sharma, told

BusinessLine: “Grocery is the next big segment with a potential to serve 39,000 pincodes in the country. I feel 39 good companies are needed to serve this huge and largely unorganised market, where neighbourhood stores still have an edge over the big box retailers.”

Alibaba-backed Paytm’s entry is also the result of other ecommerce biggies such as Amazon and Flipkart mulling a foray into the grocery segment. Amazon recently launched an express delivery platform under a ‘Kirana Now’ service in partnership with local retailers. Snapdeal tied up with the gourmet food retailer, Godrej Nature’s Basket.

Of late, several start-ups, backed by global investors, have entered the grocery space with different business models. While mobile-based firms PepperTap and Jiffstore have tied up with kirana stores to provide the last-mile delivery within just three hours, ZopNow is targeting only big box retailers like Hypercity and the cities these retailers are present. Then there are inventory-led companies such as Bigbasket, Greencart and Localbanya.

Paytm is tying up with mostly large physical retailers and convenience stores like Godrej Natures’ Basket and have partnered with local logistics players for the last-mile delivery. “The margins in the packaged goods are very high and this gives us a lot of optimism,” said Sharma.

“Besides, as we are working with leading and organised companies, we are not worried about the wastage and damage of the perishables as they have good cold-chain infrastructure in place.” The company will launch a separate grocery app called ‘Zip’ next month. Paytm has hired 20 people to deliver products in Bengaluru only.