BigBasket, the Tata Group-owned online grocery retailer, has set its sights on achieving profitability within the next six to nine months, as stated by Co-Founder and Chief Marketing Officer Vipul Parekh.
In an interview on Monday, Parekh stated, “Our slotted grocery delivery business is profitable today. Our daily business (BB Daily) is very close to profitability. Our quick commerce business (BB Now) is some distance away from profitability but we expect it to get profitable in six to nine months. The moment the quick commerce business gets profitable which is six to nine months from now, we should be completely profitable (at the company level).”
Scaling the quick commerce or instant grocery delivery business is inherently challenging due to its characteristic low order values.
“We are not a standalone quick commerce business. We also have the daily milk business and online slotted deliveries. Since we use the same distribution centres and dark stores for all our businesses, the order volume per dark store is high which is a big advantage for us. The fixed cost per order comes down. Besides, we have private labels which lead to better gross margins,” said Parekh.
According to documents filed by the company with the Registrar of Companies (RoC) and sourced from the business intelligence platform Tofler, losses for BigBasket’s business-to-consumer (B2C) arm, Innovative Retail Concepts, surged from INR 813 crore in FY22 to INR 1,535 crore in FY23.
BigBasket is exploring the possibility of substantially expanding its offline presence.
“We are trying to figure out which is the best format for us to address the offline space,” said Parekh.
The company is mulling over the possibility of initiating preparations for an IPO in 2025.
“IPO will be a function of our profitability… I think, tentatively, 2025 is a good time to think about it,” Parekh said.