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BigBasket`s Struggle with COVID-19 |
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| On January 30, 2020, India’s first COVID-19 case was reported . The infected person was a student from Kerala who was studying at Wuhan University and had come home for the vacations. Initially, the virus was detected only among those who had returned from China. But soon people with a travel history to Europe also started reporting the disease as the virus had several European nations in its grip. .. |
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| Experts believed that lockdowns were an effective way to curb the spread of COVID-19 but there were also concerns regarding the lack of preparations regarding the supply of food, medicine, and other essential items under the lockdown. Since there was no prior information about the lockdown, supply chains were broken, leading to concerns regarding the livelihoods of many people... |
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| BigBasket, an online grocery delivery service in India, was launched in the year 2011 by VS Sudhakar, Hari Menon, Vipul Parekh, V S Ramesh, and Abhinay Choudhari. Headquartered in Bengaluru, its key investors included Alibaba, Helion Venture Partners, Bessemer Venture Partners, Abraaj Group, and LionRock Capital . The convenience and wide range of products that came with online shopping helped BigBasket in increasing its customer base. It also introduced services like BBDaily which worked like a subscription service for daily delivery of eggs, milk, bread, and other essentials. Its major competitors included Amazon, Grofers, and Flipkart. .. |
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| BigBasket decided to suspend its services from March 24, 2020, after many of its delivery executives complained about being beaten up by police as well as harassed by some local goons. On March 25, 2020, BigBasket put up a notification on its website stating, “Dear customer, we are not operational due to restrictions imposed by local authorities on the movement of goods in spite of clear guidelines provided by central authorities to enable essential services. We are working with the authorities to be back soon...” |
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| With the threat of the virus looming large, there were lockdowns across the country and humongous uncertainty on what the turn of events would be, going ahead., With so much uncertainty, people resorted doing everything from bulk buying (Exhibit III) to online shopping (Exhibit IV) to ensure their safety and to brace themselves up for difficult times.. |
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| Due to the surge in demand and some governmental restrictions, BigBasket had a huge backlog of orders. It needed more delivery executives to clear the backlog. The delivery executives of BigBasket stated that the company was toiling to gather resources to drive vehicles and to bring goods from warehouses... |
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| BigBasket partnered with Uber to deliver goods to its customers. Uber agreed to deploy UberGo, UberXL, and UberMoto for delivering customer orders. It also agreed to share its technology and vast network of partners for the delivery of essential supplies to BigBasket consumers. This partnership helped BigBasket in serving its customers in Bengaluru, Hyderabad, Chandigarh, and Noida... |
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| According to Hari Menon, beginning 2018, BigBasket had successfully developed a strong infrastructure and supply chain and warehouse network. This proved to be a major strength for the company during the COVID-19 pandemic and it faced no hiccups on the supply side of its business. Its strong relationship with farmers, partner mills, and FMCG companies proved to be a boon as well. Hari Menon said, “We have now scaled up to 300,000 orders (per day). Scaling up from 30,000 orders to 300,000 took the life out of us.. |
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| Hari Menon believed that post COVID-19, more consumers would continue shopping online. His beliefs were reiterated by a survey of Indian consumers conducted by Capgemini in April 2020. According to the survey, online grocery shopping would see the following trends in the next 6 – 9 months.. |
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Exhibit I: Top 20 Countries in Total COVID-19 Cases (As on May 6, 2020)
Exhibit II: CII Snap Poll
Exhibit III: Panic Buying
Exhibit IV: Online Grocery Shopping – Is it the New Norm?
Exhibit V: Contactless Delivery
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