Shopclues, the online e-commerce marketplace which expects to be profitable by the first half of 2017, is targeting to increase its reach in tier-3 cities and rural areas by partnering with multiple logistics partners and local vendors across the country.
Vishal Sharma, vice president — operations & strategic initiatives at ShopClues, told FE that demand from smaller cities and towns has touched about 60% of the overall sales since last year and sales in rural areas is contributing to about 20% of the overall sales.
The company which entered the unicorn club earlier this year currently covers 29,000 plus pin codes across the country and plans to add 5,000 more pin codes this year. “Of the 29,00 pin codes close to 9,000 are in rural areas. Unlike in urban centres, people in rural areas are not brand conscious but they look for low-value products. And hence we are partnering with more regional manufacturers who can supply goods at a much affordable rate on which we also have higher margins,” Sharma said.
The company, which follows a marketplace model and does not own any warehouses across the country, is partnering with regional and local courier companies to ship the products faster. Sometimes 2-3 logistics companies are involved in shipping one particular product, Sharma says.
“In rural areas people are not in a hurry to buy products. The average delivery time for us is about 7-10 days. Currently we have partnered with 40 odd logistics companies across the country and are strengthening it to reduce the turnaround time (TAT) time. With surface transport and local partners it do not cost much on the logistics front,” Sharma adds.