SUMMARY
This push into the fast-growing direct-to-consumer (D2C) space would entail Zomato building its own supply chain to directly source branded products as well as manage stock
Zomato does not plan to directly own inventory. It would instead manage the flow of products for D2C brands
Blinkit clocked a revenue of INR 644 Cr in Q3 FY24 as against INR 301 Cr in the year-ago quarter and INR 505 Cr in Q2 FY24
Foodtech major zomato
is mulling to expand its quick commerce vertical Blinkit by adding more brands across new categories, as it aims to compete with ecommerce marketplaces like Amazon and Flipkart.
This push into the fast-growing direct-to-consumer (D2C) space would entail the company building its own supply chain to directly source branded products as well as manage stock, ET reported.
Zomato would deliver these through Blinkit as it has “had conversations with individual brand owners for various categories to stock up inventory. This is being seen as a potential long-term growth driver,” the report added, citing a source close to the matter.
As per the report, Zomato does not plan to directly own inventory. It would instead manage the flow of products for D2C brands.
Zomato has “at least twice attempted to acquire and merge ecommerce enablement firm Shiprocket”, the report claimed. Shiprocket works with many D2C brands at present and Zomato bought a stake in it in 2021.
While talks with Shiprocket continue, Zomato has “leased one warehouse each in New Delhi and Mumbai to support Blinkit’s ecommerce push,” the report claimed.
“New-age D2C brands in categories like home needs, small electronics, beauty and personal care are looking at quick commerce as a growing channel for sales. Blinkit has a strong footing there. Now, Zomato wants to set up a backend structure, where it would work directly with brands and help them sell on Blinkit. With this, the company gets greater control over its supply chain,” an industry watcher told ET.
Meanwhile, Blinkit clocked a revenue of INR 644 Cr in Q3 FY24 as against INR 301 Cr in the year-ago quarter and INR 505 Cr in Q2 FY24. The quick commerce vertical’s adjusted EBITDA loss further improved to INR 89 Cr in the quarter ended December 2023 from INR 227 Cr in Q3 FY23 and INR 125 Cr in Q2 FY24.
On the back of festive growth, Blinkit’s operational and financial metrics saw a major spurt. While GOV soared 103% year-on-year (YoY) to INR 3,542 in the quarter ended December 2023, average order value (AOV) jumped 14% YoY to INR 635 in Q3 FY24.
The company also added 40 net new stores during the quarter, taking the total store count to 451 at the end of December 2023.
Overall, Zomato reported its third consecutive profitable quarter. Its consolidated net profit quadrupled sequentially to INR 138 Cr in Q3 FY24. Meanwhile, the foodtech major’s operating revenue jumped 68% YoY to INR 3,288 Cr in Q3 FY24.
