Once decision can change the face as well as phase of your business. So, for a start-up taking informed decision is more important rather than taking decision from your intuition.
So, My team has tried to related some strategical concepts which Local Banya is following by understanding the industry of e-Grocery and the actions of Local Banya
Local Banya (Understanding the Strategy of Local Banya, and implementing the new one)
1.
2. About
Localbanya is India’s premier online convenience store with services across Mumbai (including Thane &
Navi Mumbai), Pune, Hyderabad, Delhi, Noida, Ghaziabad & Gurgaon.
Founders
Karan Mehrotra
Co-Founder & CEO
Rashi Choudhary
Co-Founder & COO
Amit Naik
Co-Founder & CTO
Since May 2012, Local Banya have aimed to revolutionize the grocery shopping experience with a single
minded focus to make each step of the shopping process – from its website to the customer’s home –
3. Industry Interface
Although the retail market is very old concept, but at the same time it is the biggest market. In India it
accounts For 70% of total market
E-grocery is relatively new concept in India, but it’s getting pace day by day since the inception of e-
grocery Business like LocaBanya.com
While BigBasket and Zopnow dominate in Bangalore, Bigbasket and LocalBanya have been evangelizing
the Mumbai market.
The expected player in this e-grocery may be the big giant/business houses like Reliance fresh and Future group
E-grocery market is very big, and still it has been covered only up to 7-8%. So, still there are huge potential not
Only for existing players but also for new entrants as well as for offline big grocery giants
4. Current Game Theory
Simultaneous
Local Banya’s competitors are bigbasket.com, aaramshop.com, zopnow but they are far behind from
Local Banya.
Currently Local Banya is not considering it’s competitors while making decisions. They are focusing on
their core business, and are focusing on customer satisfaction, and expanding their business in to
different regions/cities.
Since the opportunity in e-grocery business is sky-hi. So every one has a great opportunities to grow in
this market simultaneously. And, Local Banya is trying to sophisticate it’s business for the customer
without considering what others are doing
5. Current Rules of Game
Level Playing
In India out of total market, 70% is of retailing market
As of now all the offline as well as e-tailing has been able to penetrate only 7-8% of total retail market
E-grocery is a kind of new concept in this grocery/retail business, and still they would need to do a lot to
capture the market in different parts of country. So it’s not only Local Banya but also all the e- groceries existing as
well as new entrants which might come will have an ample opportunities to participate in this e-grocery business.
So, they can not only compete & survive but also can grow together.
6. Current Warfare Strategy
Guerrilla
Though e-grocery is new concept in retail business but we can’t not exclude the offline business entity
Local Banya has started it’s operation in Mumbai, and concentrated in Mumbai for nearly 1 and ½ year
exclusively, and then they started expanding in other cities like Hyderabad, Pune and Delhi areas, so, Local
Banya is using Geographic Guerrillas as warfare strategy
7. FIT THEORY
1) Basic Consistency
2) Value Reinforcement
As every value in value chain network amplifies the another value in order to enhance the efficiency of that second value
which ultimately enhance the overall value chain network. As for as local banya is concerned value chain like
Multifaceted Source helps to just-in-supply system which ultimately reduce delivery time and improves efficiency of
whole system. And, not Holding inventory helps to cut down the cost which benefits not only to customer but Local
Banya as well to quote low price
As a e-tailing grocery, Local Banya’s prime responsibility is to service customer in the best way or as per customer’s
requirement. Basic focus areas are 1) hassle free buying for customer 2) providing Branded/no-branded products
at optimal price 3) delivering good as fast as possible and as per time slot chosen by the customer
8. Discounted
price Strong
supply/c
hain
Single stop
grocery shop
Customer
preference/s
atisfaction
Multifac
eted
Sourcing
Large
no. of
listed
products
No
inventory
holding
Quality
check
before
delivery
Just-in-
time
partner
for fruit &
vegetable
Social
Media
Mkt/WO
M Mkt
User-
friendly
web
interface
Fast
delivery/
flexible
time slot
Central
ware
house for
packagin
g
Partners
hip with
offline
retailerMore &
more
buyers
Custome
r’s data
manage
ment
Activity Map
10. IFE (Internal Factor Evaluation)
Strength
Weakness
1) Strong supply-chain network
2) Multifaceted sourcing
3) Tie-up with offline retailers
4) Online delivery rate 97%
5) Fill rate 99%
6) Fast & Flexible delivery time slots
1) Reverse logistic is difficult
2) Free delivery of less than Rs.500 is not affordable
EFE (External Factor Evaluation)
Opportunities
1) Business expansion in other cities
2) Improve customer & merchant relationship
3) Tie-up with more retailers
4) Targeting people who are not e-tailing friendly
Threats
1) New entrants
2) Competition from traditional retailers
3) Contempt from local vegetable seller
4) Introduction of law for e-tailing can hamper growth
Factors Evaluation
11. IFE MATRIX
S.N
o.
Particulars Rank
(a)
Reverse
Rank (b)
Weightage
(based on
ranking)
Rate Weighte
d Score
Strength
1 Strong Distribution network 1 8 0.22 4 0.88
2 Multifaceted sourcing 2 7 0.19 4 0.76
3 Tie-up with offline retailers 6 3 0.08 2 0.16
4 Online delivery rate 97% 5 4 0.11 3 0.33
5 Fill rate 99% 7 2 0.05 3 0.15
6 Fast & Flexible delivery time slots 3 6 0.16 4 0.64
Weakness
1 Reverse logistic is difficult 8 1 0.03 1 0.03
2 Free delivery of less than Rs.500 is
not affordable
4 5 0.14 2 0.28
Total 36 36 3.23
Formula for weightage
=(1/Σa)*b
Ex. (100/36)*8=
12. EFE MATRIX
S.N
o.
Particulars Rank
(a)
Reverse
Rank (b)
Weightage
(based on
ranking)
Rate Weighted
Score
Opportunities
1 Business expansion in other cities 1 8 0.22 4 0.88
2 Improve customer & merchant relationship 4 5 0.14 4 0.56
3 Tie-up with more retailers 5 4 0.11 3 0.33
4 Targeting people who are not e-tailing
friendly
3 6 0.16 3 0.48
Threats
1 New entrants 2 7 0.19 3 0.57
2 Competition from traditional retailers 6 3 0.08 3 0.24
3 Contempt from local vegetable seller 7 2 0.05 1 0.05
4 Introduction of law for e-tailing can hamper
growth
8 1 0.03 1 0.03
Total 36 36 3.14
14. Creating A Blue Ocean
Customer preference is prime priority
Providing goods at lower price
Customer
Value
Low Cost
15. Creating A Blue Ocean
Introducing Ballot Box
BusStop
borivali
Local Banya
Ballot Box
3
23
2
Local Banya
Ballot Box
People can write the required
product and post it here
Local banya’s worker will
collect at definite time
Local Banya’s
packing
warehouse
Local Banya Membership Card
xxxxxxxxxxxxxx
16. Creating A Blue Ocean
Tie-up with Restaurant, Gym & College’s Canteen