After receiving a INR 2 crore investment from UC Inclusive Credit (UCIC), Ahmedabad-based Frendy now plans to develop its mini marts and achieve an ARR of INR 100 crore over the next six months.
Frendy, founded in 2019 by Sameer Gandotra, Gowrav Vishwakarma, Harshad Joshi, is transforming retail in India’s tier 3 towns and beyond by developing a network of modern franchise-based grocery mini marts.
Visionary Approach to Retail
The startup wants to provide consumers outside of urban areas with access to variety of branded products. While it provides digital connectivity to mini marts. According to Gandotra, Frendy’s concept is simple yet innovative: create a network of mini marts in smaller towns and digitally connect them to micro kiranas in rural areas.
Gandotra explains, “Frendy is building a chain of mini marts in tier 3 towns and beyond, digitally connected to micro kiranas in the rural catchment areas. The aim is to serve the 400 million consumers that are largely in an urban-rural population around our small towns.”
This hybrid model of physical and digital retail is designed to tap into a market of consumers with growing aspirations but limited access to modern shopping experiences. “The aspiration has grown, and they also want to shop in the same way that consumers in big cities shop,” says Gandotra. “They’re looking for a better shopping experience, which is what we seek to provide them via the Frendy mini marts.”
Continue Exploring: Tech-enabled grocery chain Frendy secures INR 2 Cr in debt financing from UC Inclusive Credit to fuel expansion
Learning from Global Trends
Gandotra draws parallels with Southeast Asia, where small-format stores have become dominant in the retail transition. “Over time, it’s the small format that has captured the largest percentage of the transition to modern trade,” he notes. This insight guides Frendy’s focus on small-format stores, which are more suited to consumers with irregular incomes and limited transportation options.
According to him, the approach enhances supply chain efficiency and provides mart owners with additional business opportunities.
The company’s strategy also includes a strong emphasis on digitization. “An omni-channel approach has been there from day one, getting ourselves digitally ready,” Gandotra highlights. This digital readiness is crucial for reaching rural customers who rely on micro and nano retail stores.
Growth and Challenges
Currently, Frendy have established 25 marts in Gujarat and over 2,000 connected micro kiranas. “We started with the micro stores and scaled it up to about 4,000, and then scaled back to keep it optimal,” he says.
The company’s private label penetration is currently around 20%, but there’s confidence it will grow as Frendy enhances its product offerings and expands its reach.
With this, the upcoming festive season presents an opportunity for Frendy to accelerate its expansion. “The track is to get to about 50 of our marts very quickly. That gives us a sufficient size where we’re now coming on the radar of a lot of brands,” says Gandotra. The company’s approach to growth is strategic, focusing on optimizing distribution vectors and enhancing supply chain efficiency.
INR 100 crore turnover target
With the surge in consumption demand, Frendy’s target is to cross INR 100 crore ARR within six months. “We should probably cross about INR 100 crore ARR in the next six months, and that is something that we are working towards,” Gandotra asserts.
The company’s revenue split currently sees 30% from marts and their supply to micro kiranas, with the rest directly from micro kiranas.
Frendy’s full-stack model, which includes digitization, supply, and credit, aims to create meaningful partnerships with micro stores. “Digitization plus supply plus credit provides a full stack, offering a really meaningful business or partnership for these micros,” says Gandotra.
