As restaurants resume their operations across the country, Bengaluru-based food delivery major Swiggy is now looking to win over restaurants by solving out the supply chain gap through its new platform Swiggy Staples Plus.
Swiggy Staples Plus is a B2B platform which delivers groceries, meat, vegetables and other supplies along with packaging material to restaurants. As of now, the company is offering these products on credit as restaurants aim to mitigate the losses faced in the last two months due to the nationwide lockdown.
Currently, Swiggy is running this platform on a pilot in Bengaluru and Mumbai as it is aiming to scale the platform in multiple cities in which it operates. The minimum order which can be placed on Swiggy Staples Plus is INR 900, according to a banner in the Swiggy’s application for restaurant partners.
Repayments of the credit are going to get adjusted with the payments which Swiggy collects from users for their food orders, according to a report by MoneyControl. Inc42 reached out to Swiggy but got no response till the time of publication. The credit is expected to be facilitated through non-banking finance companies (NBFCs).
Swiggy Staples Plus: Swiggy’s Response To Zomato’s HyperPure
Swiggy has launched this B2B delivery at a time when revenues from food orders are dwindling, majorly due to Covid-19 fear which is discouraging consumers to eat outside cooked food.
While Swiggy is a new player in the B2B delivery space, Zomato claims to be delivering fresh food, spices and others to close to 7,500 restaurants across Bengaluru and Delhi. Recently, Zomato has also opened a 10K sq. ft. warehouse in Mumbai. Additionally, Zomato’s Hyperpure is also said to be functional in Pune as well.
Speaking to Inc42, Himanshu Kalra, business head of Hyperpure by Zomato, said, “We don’t follow a credit model for most of our standalone customers. Where we do offer credit, it’s linked to the overall business volume that the customer has with Zomato across all its business lines. We are in a unique position to build credit products with third parties based on the restaurant’s business track record with Zomato. This is in progress.”
Currently, Zomato and Swiggy are arguably the leading food delivery companies in India. But many restaurants have alleged that both these companies are harming their business by offering higher discounts to consumers while taking massive margins from their plate.
However, restaurants believe that in the B2B delivery space, Zomato and Swiggy are not alone. Therefore the chances of a duopoly in this segment are comparatively lower. In the B2B delivery segment, some of the notable players which deliver groceries to the restaurants include Ninjacart and WayCool.
But Swiggy has entered in this space at an appropriate time as many B2B players are not operational currently as restaurants are not fully operational until now. Swiggy might use this time to gain the trust of restaurant-partners while it plans to scale Swiggy Staples Plus to other cities.