BigBasket, the latest entrant to the instant food delivery space, expects its cafe food business to be a significant component within quick commerce. Hari Menon, co-founder and CEO of BigBasket, in an interview with S Shanthi, talks about the reasons behind choosing a cloud kitchen model in partnerships with the Tata Group’s Starbucks and Qmin, expansion plans for the business and more. Excerpts:
Bigbasket piloted the 10-minute food delivery service a month ago in Bengaluru in partnership with Starbucks and Qmin (by IHCL). How has the response been? How many orders have you been getting?
At present, we are delivering from 12 dark stores in Bengaluru. The response has been encouraging. On a typical weekend, we get upwards of 600-700 orders a day. What we have done is we have curated the menu and pricing for the online market. For instance, we have priced vada pav from Qmin at just Rs 65-70, which is very reasonable for a product coming from IHCL. Both offerings and pricing have been set keeping customer preferences in mind. That’s why there is a lot of excitement about good stuff coming from the house of Starbucks and Qmin at reasonable prices and within 10 minutes.
You have always taken a “slow and steady” approach. Will you be doing the same for the instant food delivery vertical as well?
Our philosophy is not going to change. We are building what I call a responsible QC (quick commerce). I am not spending heavily in terms of just acquiring customers blindly. I think I will be doing a disservice to my shareholders and investors if I throw money like that. BigBasket is still a very strong brand, so I’m very comfortable about it. That’s also the Tata philosophy. The market is large, and it is not going anywhere. So, hurrying up won’t help you. One can see what’s happening in the market now. Food business is tricky. You need people to manage the inventory correctly. You can’t spread yourself thin and start getting into problems.
What kind of expansion are you looking at for this vertical?
About a year back, we decided to move to larger dark stores because our differentiation is going to be assortment, including electronics, and all the Tata partnerships that we have. From a profitability perspective, a store size of 4,500-5,000 square feet works beautifully for us. We have about 600-650 dark stores at present, which is a combination of big and small. We are going to have 832 stores by September-October and we will hit about 1,000 by December this year, all of which will be large stores. Now, in that network, about 60-to-70% of them are in really dense areas.
So, we will be expanding the cafe business in these dense areas first within Tier 1 cities. This means we will have cafes in about 500-600 stores in 10 cities by December. We are starting with Bengaluru, where we are rapidly expanding our café presence, growing from 12 dark stores currently to 52 in the next 30-to-45 days. That gives us complete coverage of most of Bengaluru’s dense areas. Next, we will expand to nine additional Tier 1 cities — Hyderabad, Chennai, Delhi, Noida, Gurugram, Ahmedabad, Mumbai, Pune, and Kolkata. From January 2026, we will start looking at Tier 2 cities.
Why a cloud kitchen model? Why not a restaurant aggregator model?
A cloud kitchen model is essential for a 10-minute delivery promise. While partnering with restaurant chains can offer brand trust, it is challenging to execute at that speed. Owning the kitchen setup is the only way to control every step and reliably meet the 10-minute mark.
What kind of revenue contribution are you expecting from this vertical by June 2026?
It’s still early, but based on the demand we are seeing, we expect 600 stores across 10 Tier 1 cities to generate approximately Rs 55 crore per month, translating to around Rs 660 crore annually. In terms of average order value (AOV), we don’t anticipate major variation. The AOV for the café business alone currently stands at Rs 300-350. However, our overall AOV is over Rs 700. That’s because the café is integrated into the larger platform, there’s no separate cart so customers can add other items along with food and beverages, driving up the total order value. While food AOV may stay consistent, the number of orders is expected to rise significantly, contributing to overall growth.
Will you also be looking at partnerships with food brands outside the Tata Group?
I don’t think we need anything more than these two brands. We already have about 200 items, including sandwiches, wraps, burgers, cakes and beverages. Our offerings will include selections from Starbucks and Qmin, delivered through our dark stores. Our cafes are powered by them. Everything is set up by them, starting from people inside the cafe, processes and proprietary equipment. So in a sense, it’s a small version of a marketplace, but within a dark store.
Will your menu only include food items prepared in your dark stores that act as cloud kitchens, or some of it will be delivered from Starbucks and Qmin outlets and stored in your dark stores?
It will be a combination of both, coming from the closest kitchens and prepared there. For example, all the various varieties of coffee cannot come from anywhere else. It gets prepared here.
What kind of infrastructure and other backend changes have you brought in for this vertical?
The large store build-up has been going on for more than a year now, but the cafe build-up started about 4-5 months ago in terms of setting up equipment etc. In terms of employees, we will have people from Starbucks and Qmin stationed in our cafes. Because of strong synergies within group companies, we utilise their expertise, which they have built and perfected over decades. We both do what we are best at…they cook and create, we deliver. We just need to tweak our tech & store planogramming which we did.
Do you plan to launch a separate app for instant food delivery?
No. We believe in the strategy of bringing everything into one app. In fact, in a couple of months, you will see our subscription business, BB Daily, also coming onto the same app. That’s what works for us.
What is the customer base you are targeting with the cafe business?
I believe a good chunk of our customers, which is 28 million, are all people who order food online. To that extent, we don’t have to create a new base. Our existing customers are our first target consumers. Then word of mouth will kick in, and we will do some marketing to bring in new customers.
What edge does BigBasket have over other instant food delivery players at present?
Ten minutes can’t be the differentiator for anybody today, because everybody is doing it. Our real moat lies in the Tata ecosystem, which brings strong, domain-led partnerships we can uniquely leverage. Another advantage is AOV. We have many new categories such as electronics and our blended (slotted and quick)AOV continues to be the highest in the industry. Within the instant food delivery category, we have the edge of working with reputed brands. Because one of the things that people are always concerned about in the cafe business is the quality of food. By partnering with trusted names like Starbucks and Qmin, that box is ticked.
As a legacy player in the online grocery delivery space, do you expect instant food delivery to become as huge as quick commerce and why?
It won’t be as large as the overall food delivery market, but it will become a significant part of the quick commerce segment. For us, it’s a natural extension and not a separate bet which is aimed at offering a wider and more convenient selection to our customers within the same platform.