Setting Up Online Grocery Business in 2021? Here’s All You Need to Know

With a CAGR of 24.8% and a market value of 189.81 billion USD in 2019 as per Software Outsourcing Stats, the online grocery store has become a lucrative business industry worldwide. Unlike other eCommerce platforms, the online grocery store offers a low-profit margin.

However, with the right marketing strategy and an advanced digital platform, you can significantly improve the ROI. Do you know what business models you can have for the digital medium? Also, what steps can you follow for setting up your digital grocery store! Read this blog to find the answer to all such queries.

Here are 3 popular business models for running an online grocery store

1. Running an offline grocery store: As the name suggests, this model requires massive investment. You will be the sole owner (or with business partners) of an inventory and selling your products directly to the consumers via the platform.

2. Tying up with the local grocery sellers: This business model will require you to tie up with the local grocery sellers and sell via them, thus earning a commission in between.

3. Following a mix of the above-two: You can have your own inventory and develop a tie-up with the local sellers to cater to a vast market.

Apart from direct profits of buying and selling goods, which is the case of the first model listed above, you can earn commissions from both the local sellers and buyers to make a fortune. Let us now look at the steps of developing a digital grocery shop.

Here's a step-by-step guide for developing a Grocery Store

Step-1: Start with researching Similar websites/apps

There are tons of online grocery platforms available in the market. Some of the prominent ones include Peapod, Fresh City Farms, Grocery Market, The Fruit Box, Fruitfal, Good Eggs, The Veggie Box by Victoria Law, etc. Researching them online will give you a decent idea of what others offer and the level of competition in the market.

Step-2: Identify the Target Audience

The target audience depends upon which business model you have chosen and includes the local sellers in a hybrid and tie-up model. To identify the final consumers, their expectations from the app, you can perform the following.

• Look at the demographic age distribution of the concerned audience.

• Find out the taste of local shoppers so that you can have notable features for the website/app.

• Identify what offers and features will set you apart from the competitors.

Step-3: Prepare the list of Must-have features for the app

Depending upon the business model, the website or app will be used by different categories of people involving the owner, the local tied-up traders, the delivery persons, and the end consumers. Let us look at the essential features for each of the concerned users.

Must-have features for the end-consumers or buyers

• Quick and simple signup

• Guest login

• Multicart

• Automatic location for delivery

• Affordable and straightforward cancelation policy

Must-have features for the working staff

• Simple profile creation and management

• Accepting/Cancelling orders

• Advance navigation for delivering the orders

• Delivery management

Must-have features for the vendors/traders

• Simple profile creation

• Accepting/Rejecting orders

• Shop management

• Reports generation

• Order management

Must-have features for the Admin

• Vendor management

• Tax and currency management

• Advance reports generation

• Creating roles and responsibilities

That was about the essential features of the software. Apart from them, a retail software development firm working on your digital grocery store may integrate multiple additional features for convenient management.

Step-4: Identify the delivery regions

Unlike other eCommerce platforms that usually work on short or long delivery schedules, a grocery store works on quick deliverables. Clients put up for urgent requirements and expect the groceries' delivery with the same day/next day/over morrow.

So, it is ideal for identifying the regions to which you will be catering regularly. Usually, such apps cater to a limited area, and it doesn't pose much of an issue to identify the potent regions.

Step-5: Plan for contactless delivery

The contactless delivery option has become one of the crucial factors in ensuring an eCommerce platform's popularity. It involves delivering the ordered products and items with minimum to zero direct human touches. Along with following the protocols, the app or the website must display the crucial steps taken to ensure the ordered items' contactless delivery.

Step-6: Decide the technology stack

The technology stack consists of all the software, tools, etc., necessary for the project's smooth development. Opting for the right technology stack proves a boon to the project as the developed website or app works smoothly without any technical glitches.

Some of the most famous technology stacks include the following:

MEAN: It is a combination of MongoDB, Express.JS, AngularJS, and Node.JS. As all the components are on JavaScript, you can ensure a uniform team for both the project's front and back end development.

MERN: It is the same as MEAN stack, but ReactJS, a library, replace AngularJS.

LAMP: A combination of Linux, Apache, MySQL, and PHP is considered ideal for long and extensive projects.

Ruby on Rails: Investing in Ruby on Rails will allow you with the quick completion of the project.

The Serverless Stack: Choosing this technology stack will offer you with high scalability and also pay only for what you use. Owing to its significant benefits many startups and SMEs choose the serverless stack.

Step-7: Connect with a reliable software development firm

The grocery software development firm working on your project must preferably have at least five years of experience. Furthermore, you can cross-check the firm review and rating on independent platforms of Clutch and GoodFirms.

Apart from them, also look for the value for money the development firm is offering you. Having the option of price matching and zero contract lock-ins are added benefits to the project.

Over to You

That was all about the step-by-step process of developing an advanced digital grocery store. Connecting with a mobile app development company in India for the project will offer you a low development cost.

Also, Indian firms offer regular reports to offer a more dedicated control of the project for the inventors.