Blinkit plans to give Urban Company a run for its money

Zomato-owned Blinkit, a quick commerce platform, is planning a foray into the home services category where it will likely allow users to schedule air conditioner (AC) repairs, book beauticians and chefs, among others, industry sources said.

While the idea is still in its early days, if launched, the company’s offerings will compete directly with Urban Company’s business. Also, Zomato founder Deepinder Goyal, who was appointed as an independent director on UC’s board, gave up his seat around mid February, FE has learnt. Goyal was appointed to UC’s board around April 2022.

While Blinkit was still working on its foray, Goyal stepped down to avoid any conflict of interest. Entrackr was first to report about the development. “Blinkit is still working on the fine print and it is still unclear on when and how these services will be launched. But with what Blinkit is trying to bring out, Deepinder only thought it was ethically right to not be a part of UC’s board,” one of the persons cited above said.  

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“It remains to be seen how things will shape up but looks like it will be similar to what UC has been doing. Even if Blinkit will operate as a marketplace, aggregate services or service providers, it remains to be seen.”

Zomato declined to comment on the developments.

This expansion comes at a time when Blinkit has been widening its offerings. Blinkit’s average order value (AOV) dropped sequentially to `553 in the October-December period, from `568 in the previous quarter. Albinder Dhindsa, CEO of Blinkit, said the fall in AOV was because the platform was getting bigger and expanding its business, despite indications of a macroeconomic slowdown.   

Last year, the company started delivering iPhones in minutes to customers in Gurugram. 

“The number of use cases that we can potentially cater to customers, which eventually helps the platform increase our wallet share, are going up…some of these are also potentially high commission categories for us…that gives us the confidence that the business will evolve in its average order size..,” Dhindsa had said then.

The home services category is seeing Accel-backed UC face competition from larger players as well. Walmart’s Flipkart had announced its entry into UC’s turf with Jeeves. The take rates, or commissions, are healthy too. UC, on an average, earns about 21-23% from each order it services. The take rate would be broadly similar even for Flipkart, analysts estimated. That was much higher than around 5-10% Blinkit currently earns on certain products. Flipkart had said the repair and installation space was highly unorganised, with only about 10% of the market being catered to by established players.