In an exclusive conversation with Financial Express.com, Hitesh Ahuja, Founder and CEO, Yumlane spoke about the company's journey in the last two years, the challenges it faces in the market and its future plans.
Mumbai-based FMCG startup QwikPik Technology, which owns and operates YumLane, aims to deliver around 10 million units by 2019, up from the 4-5 million units that it targets this year. The venture backed by Flipkart co-founder Binny Bansal, Rehan Yar Khan-led early stage venture capital firm Orios Venture and Singapore-based family office RB Investments, also plans to reach as many as 40 cities across the country.
Currently operating in Mumbai, Pune, Bengaluru and Hyderabad, the startup is growing at a decent rate and is at the centre of India’s food delivery and take away market which is pegged at $19 billion by Morgan Stanley. Yumlane’s idea of small meal boxes has been welcomed by the customers. Its business model depends on traditional channels of FMCG distribution – general stores, organised retail chains such as Hypercity, D-Mart and Food Bazar.
In an exclusive conversation with Financial Express.com, Hitesh Ahuja, Founder and CEO, Yumlane spoke about the company’s journey in the last two years, the challenges it faces in the market and its future plans. Ahuja said that the startup’s journey in the last two years has been fantastic. He said that there was a need for a product like Yumlane and the consumers have latched onto this concept very quickly. “Since two odd years we are in the business and pretty much, having the time of our lives,” Ahuja added.
Edited excerpts from the interview:
Your competition in this sector has not just been with players like Zomato or Swiggy but also with local restaurants. What were the challenges you faced and how did you overcome them?
The food business is not restricted to delivery or restaurants. I feel there was a gap in a reasonable or affordable option with a very high quality or standards of food. Even some of the restaurants are not consistent with the quality of food. We just wanted to solve the problem of quality food. And, we used a traditional channel and people were really excited about these products. With a fair bit of consumers latching onto it, we actually didn’t think of it as a problem. In fact so much so that we are live on Swiggy.
If are able to stay true to our promise, we think that consumers will keep consuming and the channel will keep on expanding from retail to online and so on. From the business point of view, I guess we have to keep investigating from the backend which is an ongoing process.
You have partnered with retail chains like Food Bazar and Hypercity. How has that helped the business and what are the tie-ups we can expect in future?
The entire country is going through increasing disposable income and more and more expenditure is going into buying food and grocery. We come as a part of the basket in food and grocery. The channel is growing at a very heavy rate. All these retail partners of Yumlane are really excited about us expanding and opening stores. Hypercity alone has 20-25 stores in four to five cities. Food Bazar, which is our new parent, has about 300 stores. D-Mart has about 150 stores. So, we expect to touch all the stores of modern trade by 2019.
Currently, you are operating in Mumbai, Pune, Bengaluru and Hyderabad. When can we see you expand to other cities?
We want to touch approximately all the 40-odd cities of consumption. From the business standpoint, we are yet to milk these four cities – in a sense that from our point of view, these cities can be big themselves. But, from the execution standpoint, we want to slowly enter other cities. In 2019, we should open 3 to 4 cities and take the presence to eighth. Then, we can take the baby steps to reach the 40 mark.
All the businesses evolve over time. How has been Yumlane’s journey in that regard?
Early days of Yumlane, when we founded this in 2016, we were a little slow in our channel identification – in terms of which channel to focus our efforts in. Also, we were slow in identifying in some of our manufacturer partners. We were unsure about how to put our multi-city plan from the backend. As we faced these problems…as a team we are a very highly execution-centric team…we took it as a challenge and worked as a unit.
But, there is not a single day in our lives when we are not really looking at a challenge or learning from our past mistakes and making new ones. I believe these are still early days for Yumlane and we still have a long way to go from where we are today.
How many units is Yumlane selling per month and what is your target?
We are on track to achieve what we had planned for this year. When we founded in 2016, we sold 50,000 units. The following year (2017) we sold about half a million units. This year, we are targetting to reach about between 3 to 5 million units. And, the following year (2019) we should be able to deliver about 10 million units.
Who do you credit the success to?
Well, we are yet to succeed…! See, the whole journey requires a lot of believers – starting from the team itself. The entire execution team of Yumlane has been a huge driver of this without which it would not have been possible. The second would be our investors – especially Binny Bansal, Orios Venture or RB investments. The third contributors would be our stakeholders – right from our manufacturing to retail partners. I would say these are the three pillars from our execution and belief point of view.
We are very lucky to work with the right people and achieve what we have!