Select Page

Online Grocery Store Consulting

Online Grocery Store Consulting

Start Online Grocery / E-Grocery Business

Online grocery (also called as E-Grocery) is the newest addition to the growing e-commerce business across the globe. It not only offers convenience but also helps in taking over a chore that has to be done periodically. Although traditional grocery business is still influential, online grocery slowly but surely is making in-roads into the mind of the customer who just might switch over to online grocery services completely.

According to forecasts, it is likely to touch $10.5 billion by 2023. Such statistics are clearly indicative of the potential of online grocery as a business in the e-commerce domain. Even though there is enough room for multiple players in the online grocery space, the pace of growth remains slow.

This page tries to enumerate the main challenges associated with online grocery business. This write-up can also serve as a guide to the wannabe entrepreneur who wants to know – how to start a grocery business online?

Challenges Associated with Online Grocery Industry

  • Developing a Viable Business Model

Many unsuccessful brands in the egrocery space failed to plan according to the emerging market conditions. One of the primary requisites for running a successful online grocery business is through correct anticipation of recurring costs and capital investments. Many online grocery brands that went out of business grossly underestimated recurring costs and capital investments, which tends to be on the higher side in online grocery compared to established e-commerce companies.

Such a scenario makes it imperative for online brands to correctly gauge the magnitude of these economic parameters to define an achievable number as the breakeven point. Unless a business is able to successfully forecast these numbers with some confidence – the viability & ROI related to the business hangs in balance.

  • Use of Appropriate Order Management Software (OMS)

In a highly competitive online retail space, it is necessary that companies do not lose out to opportunities to impress a customer through accurate billing, and timely delivery. In most cases, it is observed that the selection of an OMS solution proves to be detrimental to a less-than-desired performance. An OMS by principle should allow a company to seamlessly – receive, confirm, and track delivery timelines with precision. If the OMS does not perform to established benchmarks, the chances of losing out on customers remains high.

  • Creating a user-friendly Website/ App Interface:

The website and the app are the crucial interface between the customer and the online store. And the store has to make all the necessary efforts at making the experience worthwhile for the customer. Store owners must understand the crucial need to provide a localized experience to the user through an improved User Interface (UI). Apart from localization, stores must design a website/ app interface that is easy to use and navigate. It has been observed that on many occasions, online stores lose out on customers due to the complex mechanism put in place. To put things in perspective, the price cannot be the differentiating factor in an e-grocery store rather it is the shopping experience & service being offered to the customer.

  • Standard Operating Procedures (SOPs):

As an online grocery store, your success will be directly proportional to how organized you are as a business. This would mean having formal and standardized systems in place for the benefit of all stakeholders in the organization. For instance, last-mile delivery is a critical component in the egrocery business.

Customers expect daily essentials to be delivered within hours, unlike an electronic item where a waiting period is tolerated. Unless you are able to deliver in a stipulated time frame on a consistent basis, you are really not providing value as a brand. This makes the entire online grocery operation a high-commitment service with thin margins and any lapses can be detrimental to the bottom line. Hence, well-defined SOPs can be a solution to many business functions within the organization, helping you provide a better service without mistakes that can prevent financial losses.

  • Developing Robust IT Backend:

The outside world only gets to see the web interface on the online store when ordering an item. But, there are a myriad of activities that happen behind the scene which include order and inventory management, home deliveries, returns, automated warehousing, CRM systems, analytics.

All these systems support the smooth functioning of an e-commerce store, beginning with order and ending in-home delivery. These systems also help in reducing the costs associated through optimization of operational functions. Unless a business has in place robust IT systems, it will find it difficult to sustain in the long term. At YRC we have the necessary technical expertise in helping you in building a strong and resilient IT framework for an online grocery business.

  • Planning Just-in-Time Procurement

Running an online grocery / E-Grocery store involves dealing with substantial quantities of perishable items such as milk, vegetables and fruits. Although infrastructure can be evolved to store such items within climate-controlled conditions, it does involve a massive infusion of capital. This can be avoided altogether if online grocery stores wake to the possibility of incorporating inventory analytics, wherein procurement is done in measured quantities only to meet the existing demand. Instead of buying in bulk and storing, it is about buying in the right quantity at the right time.  This, in turn, will allow online stores to maintain positive cash flow and also reduce any kind of wastage associated with date expiry and pest infestations.

  • Building Effective Marketing Strategies

The traditional form of marketing is paving the way for digital marketing at least in the digital domain. Online grocery stores have to incorporate effective digital marketing to succeed. The need here is to evolve an implementable strategy that will drive the marketing initiatives of the brand. There are numerous activities that can be done to drive marketing online. Starting from content marketing to paid advertising to search engine marketing (SEM) and the list can go on. The motto has to be “More Digital and Less Conventional” when adopting digital marketing.

Rather than replicating successful strategies and executions, it is better to understand the market, target audience and the inherent strength of the brand to drive a marketing campaign. Every brand is likely to have a customized roadmap and this need not be chalked out in-house rather it must be evolved by partnering with a digital agency which can help in doing so. With honest and credible inputs, a Management Consulting Company like YRC stands a better chance at executing an online marketing strategy aligned to business goals of an online brand.

  • Understanding the Current Scenario

COVID has impacted the normal functioning of all businesses and online grocery business is no exception. Businesses have been forced to adopt safety measures across the board to safeguard both internal and external stakeholders. The situation demands that each stage of online business starting from procurement to storage to delivery has precautionary measures in place.

Such a situation makes it essential for a business to evolve guidelines to enforce safety measures. The better approach here is to formalize all tasks through Standard Operating Procedures (SOP) and follow it up with regular safety audits to monitor compliance. We at YRC come with the core competence for evolving and implementing SOPs at all stages of an online grocery business.

Why is YRC the Best Consulting Partner for an Online Grocery Business?

We come with the necessary experience of having dealt with online grocery brands and have helped them evolve as a brand. Our core expertise is not limited to SOPs but it extends to every business function associated with an online grocery store. We have in-house supermarket setup consultants who can help you set up an online grocery store right from the start or can help you with other related aspects like grocery dark store design etc. Over the years we have closely studied the growth of online supermarket business model across the globe to have grocery business consultants who can provide advisory and consulting services for setting up and growing an online grocery business with success.

Our Services

Get Advice for Online Grocery / E-Grocery

    Related Blogs

    Retail Athleisure

    Retail Athleisure

    Aug 6, 2024

    Athleisure Basics What is Athleisure Fashion? The essence of athleisure lies in the term itself – ‘athletic’ and ‘leisure’. Thus, athleisure is a type of fashion that blends the functionalities of athletic and casual wear. The need for athleisure fashion mainly arose...

    read more
    How Hyper-Localization Helps Retail Jewellery Brands?

    How Hyper-Localization Helps Retail Jewellery Brands?

    May 17, 2024

    Shoot for the Cut Is being a renowned brand enough to develop new markets or achieve growth and expansion in existing ones? In the retail jewellery sector, these feats are not easy even for established brands and businesses. Even a renowned jewellery brand may find it...

    read more

    We work only for Visionaries.

    CONTACT

    PROCESS AUTOMATION

    The idea of having Ecommerce Consultants on-board from the beginning itself points towards reducing the involvement of the promoters in daily operations. Ecommerce Businesses willing to be a brand reaping profits & sustaining the competition must ensure that most of their processes should be automated. The more the manual intervention, the more would be the errors.

    In Ecommerce business, you get only 1 chance to impress the customer & if you mess up there, you lose the customer for long.

    Process automation in respect to all the activities pertaining to customers from order receiving to order fulfilment is a must for a seamless experience for the customers.

    Task Management is another grey area where most deadlines fail as 90% of the tasks are assigned manually & are forgotten, unheard, misunderstood or mistaken.

    YRC Team of Ecommerce Management Consultants helps to make maximum of the processes system-driven to ensure minimalistic manual intervention.

    VIDEOGRAPHY & PHOTOGRAPHY

    No matter how good your product is, the customer would know only if it looks good.

    Photography includes the following steps:

    • Cataloguing your products
    • Cataloguing your images
    • Backup your images (A few cloud storage solutions include Dropbox, Google Drive, Bitcasa, Apple’s Cloud Storage etc.)
    • Choose the right camera & lens (You may also outsource the photography to a third party agency)

    DIGITAL MARKETING

    Digital Marketing includes SEO & SMM. SEO i.e. Search Engine Optimization includes activities like back-linking, meta tags, blog-writing etc. to ensure your website ranks on the 1st page on Google Search.

    Next comes SMM i.e. “Social Media Marketing” which as the name suggests including promoting your products on all the social media sites, email marketing, influencer marketing & several other BTL activities.

    These activities are going to be recurring & would decide the traffic on the website, the conversions, whether the right target market is tapped, the likes, the views, the orders, the reviews & much more. YRCs Ecommerce Consultants create a budget for digital marketing right from pre-launch to launch & for each month thereafter.

    Building digital marketing strategies in coordination with the agency, selecting them to signing them off would be the role of YRC.

    This ensures seamless coordination, detailed interactions & desired execution as it is always advisable to work with a single agency than multiple of them.

    IT INTEGRATION

    Selection of the right software for smooth functioning of back-end operations right from production to webstore display would be suggested and integrated by YRC Team.

    YRC’s Team defines SOPs of Product Movement, maps it with the locations & people. They then create a blueprint of all the features required in the software & help in shortlisting & selection.

    IT Integration involves connecting your offline inventories with real-time online webstore so when a sale occurs, inventories get deducted real time across offline as well as online platforms.

    This helps in accurate inventory management, maintaining the MOQs, re-order levels & achieving the optimum inventory levels.

    Some popular software include unicommerce, viniculum for your front-end website management & Genisys for your entire back-end Purchase, Production, Accounting, Invoicing etc. management.

    WAREHOUSE & LOGISTICS PLANNING

    • How many cities or countries you wish to sell in?
    • Where should your Warehouse be located?
    • Should you have one warehouse in each country or city?
    • Should you be having your own delivery team in your base city?
    • Would the 3rd party vendors be reliable? What happens when they lose or misplace your product during delivery?
    • How should I manage the logistics if my goods are coming from different countries?
    • How should the goods be stored and barcoded?
    • How much space do I require for warehouse?
    • I am sure several such questions must be haunting you while you think of starting your own fashion ecommerce brand.

     

    At YRC, our warehousing and logistics experts can help you devise a strategy for all of the above mentioned queries and much more.

    We design the layout of the Warehouse considering the inward, goods processing, software entry, barcoding, outward, goods return, scrap storage, goods stacking & much more.

    Logistics route plan is devised considering the manufacturer to your warehouse and from there to last mile delivery locations.

    UI & UX DESIGNING

    This Step involves 03 distinct parts:

    Part 1: Choosing the right Platform:

    From several platforms available in the market right from Shopify to magento, woocommerce, prestoshop, wordpress etc. you must choose the one that fits best for your business

    Part 2: UX Designing:

    “UX” denotes User Experience, which if put in simple language is building the functional requirements of the website.

    UX Designing includes designing the features required in the website, customer journey map, website features, the browsing features, navigation features, ecommerce order management process flow, checkout cart features, catalogue management, ecommerce payment system, cross selling features & much more.

    “As per statistics, 68% of the customers abandon the carts before payment”

    An interesting UX ensures the customer sticks on to the website for a longer time.

    Part 3: UI Designing:

    UI stands for User Interface, which means designing the look and feel of the website. UI includes using the right colours, elements and the entire aesthetics of the website.

    A good User Interface ensures the user completes the task that he has come for. It navigates the user through the journey of the brand in the simplest but most effective way.

    The UX designer maps out the bare bones of the user journey; the UI designer then fills it in with visual and interactive elements.

    If User experience is the bare bone, user interface wraps it up with an attractive cape.

    At YRC, our team if experts can help you develop the entire User Journey to ensure it is engaging!

    SAMPLING & PRODUCTION

    This step follows the “Designing” Phase, whether you have an in-house design team, freelance designers or an outsourced design company. It is one of the most exciting phases, as here you see your designs turning into products & your ideas turning into reality.

    In most start-up cases, production is outsourced i.e. brands tie-up with the established manufacturers/ job-workers to get their products manufactured.

    Sampling involves multiple 04 Stages, Fit-Sample, Prototype Sample, Pre-Production Sample & the Production Sample.

    Prototype Sample is the first sample provided to the buyer. It can be in any fabric/ colour. This sample is just to understand whether the product design looks equally great in reality.

    Fit Sample, as the name suggests is prepared to check the fit of the garment i.e. the various sizes, length, width etc.

    Pre-production is made by the actual production line. Here the stitching quality and other aspects related to manufacturing are checked. This is the last stage where rejection can be accepted.

    Production Sample is made before the production which is the replica of what is going to be finally produced.

    Once you are through with all this, you are good to go ahead & get your goods manufactured.

    PRODUCT DESIGNING / SOURCING

    Product Designing or Sourcing is the heart of the Ecommerce Fashion Brand.

    Product Designing / Sourcing can be done in several ways, as follows:

    • In-house Design Team
    • Freelance Designers
    • Outsourced Design Team
    • Ready Product Sourcing (From Manufacturer or Wholesaler)

    At YRC, we evaluate your business strategy & business model to arrive at the decision, which of the above ways would be best-fit for your business. In certain cases, product sourcing may be a combination of the above.

    These are the people who are going to build your brand! Whether they are the designers or merchandiser, your brand look is going to be in their hands.

    If you are designing each garment from the scratch, the sourcing would play crucial role in developing design identity of your brand.

    Sourcing includes fabric, trims, lining & all the raw material required to build the garment.

    BRANDING

    Branding is the “Look of the Brand”, right from logo to tagline, the colours used, the brand story, the brand communications on social media, the packaging & all the other aspects which speak directly or indirectly to the customers. Branding constitutes the look & feel of the brand & hence must be thoughtfully planned to match with the product that we are selling.

    Branding must appeal to our target audience. Example : A golden colour logo depicting finesse, art, richness, premium, however beautiful it may be individually cannot go with a brand selling affordable kids wear products. So, your logo must be in-line with your brand positioning, whether you are an expensive brand or a luxury brand or a value for money brand, it must be depicted from your “Branding”.

    It is an integral part to attract the target audience.

    ORGANOGRAMS & SOP’s

    Organogram is the “HR Blueprint” of the business which is created at the onset, to map out the team required across each function at various stages of the business. At the launch, only key people need to be got on board to ensure the project gets started & at this stage, all of them need to multi-task. Similarly, certain financial as well as operational goals are set for addition of the further team. Example, for the operations team, we hire 1 operations manager during the pre-launch phase & we add 1 more only when the business kicks-off & we reach a volume of selling more than 1000 pcs/ month or a turnover of more than 0.1 million USD.

    SOPs are Standard Operating Procedures, a bible to run the entire organization right from Sales, Purchase, HR, Order receiving to Order fulfilment, Inventory Management, Accounts, Warehouse, Logistics, Supply Chain, Production & all the other relevant functions for the business. Business must be organized from its first day of operations; only then the tasks can be delegated.

    At YRC, we design the organization structure, the processes, and approximate time taken to execute each process, job profile of every member within the organization, their KRAs, KPIs & the Reporting Structure.

    CRITICAL PATHWAY

    Critical Pathway Analysis (CPA), is a project management technique which cannot be overlooked while launching an ecommerce fashion brand. Brand launch process is cumbersome with multiple inter-dependent & time-bound tasks involved, which need to be tracked to ensure the project remains on track.

    CPA outlines key tasks across the project, their turnaround time (TAT) & the dependencies of tasks upon each other. It identifies the sequence of tasks, their interdependent steps from inception to completion, their criticalities, and their dates of onset, target dates of completion along with the key responsible person for the respective activities. Critical Pathway helps in understanding the unimportant & not urgent tasks which may jeopardize the execution of the project because of an unexpected snag! It also maps out the potential bottlenecks which might be posed because of the dependencies of tasks upon each other & cases where the next task cannot be commenced before the completion of the previous one.

    CPA detects the minimum & the maximum time involvement of a particular individual or team to execute the task, thereby arriving at the overall deadlines associated with the project.

    At Your Retail Coach, we design the Critical Pathway & review it periodically to ensure the project is on track & the progress is measurable.

    BUSINESS STRATEGY & BUSINESS PLAN

    Business Strategy includes the vision, mission, goals, business model, business plan & strategy for all the functions within the organization.

    Business Strategy is a well-defined plan that outlines who, what, where, why, how & when for the company; for example, who would be the target market, how to attract the target audience, when to launch new products, where to operate from, how to handle competitors, what would be the USP, what would be long term goal of the organization & several other answers to the 5Ws of Strategy.

    Business Strategy aligns the organization towards a common goal. Business SWOT helps company to identify & overcome their weaknesses & focus to sharpen the strengths. Business strategy forecasts future risks and helps business in building skillsets to overcome the potential threats.

    YRC’s Business Plan focuses on creating a “Blueprint” of the business, thereby deriving the feasibility of the concept & gauge whether the opportunity is lucrative to invest time, energy & effort. Business Plan creates cash flow understanding i.e. building inflow & outflow cash projections from Week zero to week 60 i.e. 05 year projection. Business Plan calculates the capital investment, operating costs, one-time costs, recurring costs & all the other numbers relevant to obtain the breakeven sales, return on investment, return on capital, internal rate of return & several other ratios. Business Plan is also one of the important requirements if you are targeting the “Investor Route”. Fund raising becomes extremely transparent & channelized. With business plan panned out clearly, the business will know until what point must it be stretched & where to stop, which reduces the probability of unplanned investments.

    MARKET RESEARCH

    Starting the concept of Ecommerce Fashion brand with Market Research ensures we get detailed understanding of the industry & this research report also acts as a social confirmation for your concept. Market Research helps in understanding the target locations, their population, potential online buyers for your product, competitors for each category, and top selling products of the competitors, competitors’ price range, offers & their responses & much more. Market Research helps in thorough understanding of your brand position as compared to our competitors. It helps in identifying gaps in the market, in your category along with the scope of the said product in the desired market. This will help in validation of your concept & prevents you from making the same mistakes as your fellow brands, eventually saving your time, energy & efforts. This phase is also a make or a break phase, as the market research study may at-times come up with some eye-popping numbers & statistics which might compel you to re-think on your product or category that you are planning to sell or alter your entire concept itself!! Market Research Reports analyse the competitors’ webstore for their traffic, conversion & sales. This is extremely valuable information to derive our inventory budgets & projections, which takes us to our next phase.