Technology and digital demand for smart applications are rising exponentially like never before. You all buy groceries and household needs to satisfy your daily needs. All your grocery orders can be delivered to your doorstep using an app on your android phone, eliminating the need to go to the nearby stores for your daily wants.
Swiggy, Instamart, Grofers, Joker, Bigbasket, and Jiomart are a few companies competing with the primary objective of dwindling delivery time and delivering supplies in 10 -15 minutes, and Zepto as well.
Zepto is another grocery delivery platform that gives incredible deliveries of groceries within 10 minutes, built in order to transform grocery sales and deliveries. Generally, it takes up to 30 minutes to deliver but does Zepto manage it? And how is the grocery delivery business witnessing significant growth in the future? Read the blog to know Zepto’s business model and its story.
Growth of the grocery delivery business
According to Future Market Insights, the Online grocery market of India is forecasted to expand from USD 4,540 million in 2022 to USD 76,761 million by 2032 at a compounded annual growth rate ( CAGR ) of 32.7% in 2032. The market is experiencing tremendous growth in view of adapting lifestyle of consumers, escalating urbanization, and the techie generation who prefers to buy products online.
People are more often using configurable and effective online platforms for grocery shopping in lieu of visiting their local vendors as a result of increasing discretionary income which raises the growth and opportunity of the Indian Online grocery market.
There will be tremendous growth in the upcoming years as the Indian online grocery market is providing no-contact delivery and an online payment which increases consumer buying behavior having a positive impact on the online grocery market.
Just after the COVID-19 pandemic, the acclaim of online grocery delivery grew significantly. As a result of social distancing, consumers are shifting to online grocery shopping, which is not only more convenient but also safer.
They manage their business efficiently with its incredible business model and dedicated bunch of employees. Come let’s know how it has revolutionized the grocery delivery industry.
About Zepto
The Mumbai-based startup offers a 10-minute grocery delivery service. It’s a company known for delivering groceries in 10 minutes and was founded by Aadit Palicha and Kaivalya Vohra.
In 2021, it worked with 86+ dark store owners in thirteen different areas, resulting in over one million deliveries. It uses a network of ‘cloud shops‘ or micro-warehouses to fulfill orders quickly.
They have been booming because of their capability in producing more than 2,500 products for delivery in less than 10 minutes. They focus on the expansion of the company by maintaining phenomenal customer loyalty.
With the dark store concept, the parel-based grocery delivery has shortened the time of delivering groceries to 10 minutes.
Rapid commerce will be the next big opportunity for the supermarket delivery industry. The Mumbai-based startup has an excellent customer response in the markets and it is currently operating in Mumbai, Delhi, Bengaluru, Gurugram, and Chennai and is looking to expand into new markets in Hyderabad, Kolkata, and Pune.
Startups such as Zepto in India and Fridge No More in New York City are one of the fastest-growing businesses in the delivery industry.
Zepto Founders and Team
- Aadit Palicha and Kaivalya Vohra, both 19-year-old childhood friends, founded it after leaving Stanford University’s reputed computer science department to return to their home country of India and begin a business. The company was founded in September 2020 and began operations in April 2021.
- The CEO and Co-Founder of KiranaKart and Zepto, Aadit Palicha founded his first startup GoPool when he was just 17 years old. He earned his Bachelor’s degree in Computer Science from Stanford University after completing an IB diploma in Mathematics and Computer Science from GEMS Education.
- He completed Y Combinator Grade: W21 and began working as a Project Lead for PryvaSee. He left GoPool in April 2020 to launch KiranaKart and Zepto.
- Co-Founder and CTO of KiranaKarta and Zepto, Kaivalya Vohra a graduate of Computer Science from Stanford University.
- Vohra and Aadit went through Y Combinator, and their company presently employs 51 to 200 people.
Name and Tagline of Zepto
Zepto’s tagline is “Groceries delivered in 10 minutes“
The term “Zepto” denotes the factor of 10⁻²¹, i.e. 0.000000000000000000001,” provides a 10-minute grocery delivery service, outperforming numerous well-funded competitors.
Zepto Business Model: Dark Store model
Dark stores might sound shady, but they’re actually a genius way for retail businesses to keep things running smoothly during the pandemic. These mini-warehouses are closed to the public, but they’re super efficient at filling orders for online shopping, same-day delivery, and in-store pickup. Basically, they make it easy for shoppers to get what they need without having to brave crowded stores.
According to the founders, the secret behind dark stores is their lightning-fast picking, packing, and dispatching process – all in under a minute. But once the goods are on their way, it’s just like any other delivery model for the final leg of the journey.
While the dark store model has been successful in developed countries, it’s a new concept in India. But it’s already tackling some of the biggest headaches for delivery services – traffic jams, navigation issues, and connectivity problems.
Zepto uses location intelligence to optimize the network’s performance by taking into account things like geography, population, road patterns, traffic, weather, and more. They’ve already set up over 40 dark stores in various locations.
While dark stores are great for quick deliveries, they can’t handle huge sales volumes. But Zepto has figured out a way around that. They have over a thousand products on display, including fresh produce, milk, meat, and kitchen essentials – all at great prices. Plus, their AI powered tools make sure that everything goes smoothly from picking to packing to delivering.
Zepto Business Model and its Benefits
There are numerous advantages to Zepto’s business model. Here are a few key benefits.
Faster delivery and improved distribution
Zepto’s dark store helps them fulfill orders quickly and efficiently. With a variety of distribution options, they can bring groceries closer to customers, making it easier for people to get the goods they need. Plus, having control over the market spread means Zepto can make sure everyone has access to fresh groceries. All in all, they’re making it easier and more convenient for people to get their grocery shopping done.
Increased Customer Reach
Say goodbye to long wait times and hello to instant gratification with dark stores!
These mysterious facilities bring the convenience of online shopping right to your doorstep. And with their always-on status, you can shop ’til you drop 24/7. It’s the ultimate way to upgrade your shopping experience.
Contactless Purchasing
The whole contact-free thing has been a game-changer for businesses. Enter the dark store: the perfect solution for avoiding awkward encounters at the grocery store. With dark stores, you can shop from the comfort of your own home and get your goods delivered in a flash. No more dodging other shoppers or standing in line. It’s like having your own personal grocery concierge at your fingertips.
Improved Inventory Control and Product Selection
Forget the crowds and chaos of traditional stores, dark stores are the future of shopping! These sleek and efficient facilities are designed to make your life easier, with AI-powered tools to keep track of inventory and an optimized layout to make packing a breeze.
Plus, with no customers to worry about, you can focus on getting your orders out the door and on their way to happy customers. It’s a win-win!
What makes the Zepto Business Model Unique?
- Zepto’s business strategy revolves around providing customers with quick service. Nonetheless, Zepto provides several marketing elements that set it apart from its competitors. Even though, the model takes these into account as well.
- Zepto’s free shipping makes it more attractive than companies that charge a delivery fee, such as Instacart and Amazon Fresh.
- It is all about quick delivery; their website claims a median delivery time of 8 minutes and 47 seconds. That’s working great!
Zepto – Revenue
“Zepto’s advertisement and promotional expenses amounted to 33% of its total expenses in FY22. The company’s last valuation of $900 Mn is 48 times its total revenue for the same fiscal year. Additionally, Zepto spent INR 3.7 to earn a single rupee in FY22.”
Zepto – Valuation
| Month | Event |
| April 2021 | Initiated |
| November 2021 | $60 million was raised at a valuation of $225 million |
| December 2021 | $100 million was raised at a valuation of $570 million. |
Zepto Investors and Funding
| Date | Investors |
| May 2, 2022 | Series D – Y Combinator Continuity Fund ( $200 million ) |
| Dec 20, 2021 | Series C – Y Combinator Continuity Fund ( $100 million ) |
| Oct 31, 2021 | Series A – Glade Brook Capital Partners ( $60 million ) |
| Sep 1, 2020 | Pre-Seed Round ( Contrary ) |
Zepto Competitors
Many businesses compete with Zepto and have also pioneered fast-paced grocery delivery, such as:
- Swiggy
- Instamart
- Blinkit
Swiggy and Big Basket have indeed begun delivering groceries in 10-15 minutes, and Blinkit is preparing to launch 10-minute grocery deliveries in 10 cities, all of which compete with them. Dunzo, another startup that competes with Zepto, utilizes its Xpress Mart dark shop network to supply groceries in Bengaluru in 19 minutes.
Final thought
The fact remains that they are currently growing faster than anyone else in the niche. They intend to expand into newer cities as quickly as possible. They also intend to expand their coverage to micro-markets in order to gain a decisive leadership position in the sector. Several other people are attempting to enter the market and grow quickly.
However, they cannot make promises like 10-minute delivery as consistently as Zepto. In most cases, this period lasts 30, 40, or 45 minutes. It is a detail-oriented and intense company with strong technical and operational discipline that enables them to deliver in 10 minutes.
Zepto FAQs
What is Zepto?
Zepto is an online grocery company that offers a convenient and fast way to purchase groceries and household essentials online.
What products does Zepto offer?
Zepto offers a wide range of groceries and household essentials, including fresh produce, dairy, meats, pantry staples, personal care items, and more.
What is eccentric about Zepto?
Their business model delivers your grocery in 10 minutes. It began its operations in 2021 in Mumbai and has expanded to Delhi, Bangalore, and 4 other cities.
What does Zepto company do?
Zepto, headquartered in Mumbai delivers 5000+ products, including daily cooking essentials, dairy, fresh fruits and vegetables, health, and hygiene products.
How much does zepto charge for delivery?
Delivery charges – Rs 35 for orders under Rs 99
Does Zepto provide a refund?
You will be accountable for paying for your own return shipping costs. The cost of shipping is non-refundable. The cost of return shipping will be excluded from your refund if you receive one.
