udaan flies high as it onboards over five lakh new retailers in 2021

The company claims that it has over 200 warehouses spread across the country, which allows it to serve close to three million buyers on a next-day basis

s for promotion, the company claims that word of mouth has helped to acquire new users on the platform.
As for promotion, the company claims that word of mouth has helped to acquire new users on the platform.

As fast moving consumer goods companies (FMCG) look to strengthen their distribution play, B2B e-commerce platforms have emerged as the preferred choice. Bengaluru-based firm udaan, for instance, claims to have onboarded over five lakh new retailers and kirana shop owners in 2021. As of now, the company claims that it has over 150 FMCG companies on its platform as partners, whose products are sold through udaan. The number of partners grew by more than three times in the last one year, Vinay Shrivastava, head, FMCG business, udaan, told BrandWagon Online. “This has been at the back of widening retailer base. As a company, we have enabled homegrown brands to go national through our extensive distribution network covering 1,200 cities and towns and over 12,000 pin codes,” he added. As per the company, the food business (comprising FMCG, staples and fresh products) accounts for about 20% of the overall business. 

The company further claims that it has over 200 warehouses spread across the country, which allows it to serve close to three million buyers on a next-day basis. “Our partners need not invest in constructing warehouses, as we have these at a regional level. This way partners can focus on brand building and creating product differentiation which leads to a win-win situation for them in the market,” Shrivastava stated. 

Citing an example of the reach of the platform, Shrivastava said that emerging brands such as Sundar Biscuits, Sanjeevani Tea, and energy drink brand Hell Energy, among others have benefitted from the platform. Sundar Biscuits expanded from two cities to over 12 cities in three months and witnessed 56% month-on-month growth in terms of orders on the udaan platform. While Sanjivani Tea witnessed over 46% increase in buyer base post joining the udaan platform. “Going forward, the idea is to keep increasing reach, which allows better access for brands and provides greater assortment for our buyers,” he explained. 

The B2B e-commerce platform claims to have created three revenue streams – commission through sales of product – this ranges anywhere between two percent to 15% depending on the size of the company; in-app advertising and delivery charges paid by the buyers – done through the in-house delivery service udaanExpress. The company, however, denied to comment on the share of these in the overall business. Furthermore, the platform enables working capital requirements for sellers and buyers to grow their business through the non-banking financial company, udaanCapital. udaanCapital currently helps disburse over Rs 8,000 crore credit a year to 150,000 kiranas and small businesses.

As for promotion, the company claims that word of mouth has helped to acquire new users on the platform. “We also have an on-ground field force of more than 3,000 people (specifically for the FMCG category) whose primary work is to onboard retailers by educating them about the app,” Shrivastava stated. 

According to a US-based research firm Bernstein, Udaan is the largest e-commerce B2B company with an 80% market share, with over 5,00,000 products across 2,500 brands on its platform. The platform claims to have a network of over three million retailers, kirana shops, hotels, restaurants, catering (HoReCa), chemists, farmers and over 30,000 sellers. Furthermore, it states that over five million transactions and deliveries are undertaken on the udaan platform every month. 

Read Also: SUGAR Cosmetics looks to expand offline across 60,000 stores over the next 12-15 months

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