Bengaluru based hyperlocal startup Ninjacart and Delhi based SRS Grocery on Thursday declared that they will sell onions at Re 1 a kg for a 3-day period between September 4 and 6. In the open market, the price of onion is anywhere between Rs 60-80 per kg.
Hyperlocal delivery services have got on to a price war on onions. Bengaluru based hyperlocal startup Ninjacart and Delhi based SRS Grocery on Thursday declared that they will sell onions at Re 1 a kg for a 3-day period between September 4 and 6. In the open market, the price of onion is anywhere between Rs 60-80 per kg.
Ninjacart is putting a cap of a maximum of 1 kg per person, while SRS Grocery is capping it at 2 kg per person. Pratik Jindal, CEO of SRS Grocery told FE, “Last week when we offered onions at Rs 19 a kg, we received good traction. We saw around 4,000 orders of which 3500 orders had onions in their list. Our philosophy is to invest in the consumer and bring them the best deals. Hence we are now offering them at Re.1 per kg.”
Ever since onion prices skyrocketed, online grocery stores have been trying to take advantage of the market situation. Navneet Singh, co-founder at Pepper Tap told FE that when they offered onions at a discouted price of Rs 40 last week, sales had witnessed an immediate uptick. “When we came up with the flash sale and 50% discounts, we sold more than 3 tonnes of onions on those days,” Singh said.
Commenting on short-term offers, Nagaraja Prakasam, an angel investor said, “They are using the predatory pricing model for gaining traction and it is covered by the customer acqusition cost.”
Ninjacart’s co-founder, Ashutosh Vikram said they are expecting to sell about 10 tonnes of onion over the weekend. “We want people to experience our App and this is one of the marketing strategies for us,” he said. Ninjacart, the app-only startup which started earlier this year is operational in Bengaluru.
According to research firm IGD, the Indian grocery market is estimated to be less than $100 million at present, and is expected to cross $25 billion by 2020. India would overtake Japan to become the third largest market worldwide by 2016, the report added.