Your Banya gets Online with LocalBanya

The Banyas

Karan Mehrotra, a computer engineer from the Rajiv Gandhi Institute of Technology, Mumbai is the brain behind the venture and looks after the logistics. His friend and now business associate Amit Naik -- also an engineer -- went on to pursue his MBA in operations from the Indian Institute of Management-Lucknow, before taking over as their strategy and brand-building partner. Rashi Choudhary, who holds an MBA in services management from the SP Jain Institute of Management Studies, Mumbai, supervises customer and employee relations.

What prompted you to startup?

Karan: I was already involved in the field of food distribution catering to restaurants, flight services and hotels across Mumbai. In the last few years of doing business, I also had over 200 households buying from me regularly mainly because of the quality and prices I offered. We have been distributors for brands like Hindustan Lever and run a family business. But I wanted to do something on my own -- something that is new and appeals to everyone. I worked out of a warehouse. There was a huge client base but no place to retail. So, I decided to go online.

I had discussed the idea with Amit and after meeting Rashi, we were convinced that we should not wait any longer.

Rashi: I had always faced trouble shopping for groceries. Every time I telephoned our local banya, he would end up taking the wrong order or send us something other than what we ordered. Even when supermarkets emerged, I had little motivation to move out of the house, especially during the summers and monsoons. Also, I have worked in retail industry, it is exciting to be in an industry which is booming & wanted to start something in retail. When Karan discussed the idea of an online supermarket with me, I jumped at it. I knew exactly why it would click.

Amit: I had stints at Google and Directi, which exposed me to the world of .com. I learnt the inner workings of the online advertising world at Directi, and Google was a good exposure to understanding online user behavior: E-commerce had always excited me. I'd started an online brand of printed tee-shirts, we did very well but I had to move to study, I had to shut shop. Since then, I was eager to try out something else and when I heard of the LocalBanya concept, I knew that it was just perfect for me.

The Banya Factor

As a differentiating factor, they have introduced the pot bellied mustache Banya. The Banya adds the personal touch that is missing in online shopping. They are trying to add fun in the entire shopping experience through social media.

The Banya Products

Currently they deliver everything from the basic grocery list: staples, beverages, Fresh fruits & Vegetables, even Soaps, Detergents & Cleaning supplies. They have recently added Laptop bags, coasters, magazines, frozen foods & are in the process of adding kitchenware.

“E-commerce is booming, but many people are predicting the bubble will burst. It will burst, but the fundamentally strong businesses will survive. The Ecommerce industry is still at a growth stage; it is still very nascent in India and has a long way ahead of itself before we can judge what comes out of it. We are confident everything will move online; even your laundry! Our fundamentals are straight forward -we choose to grow at an adaptable rate, and are constantly cutting operational and logistics costs,” says Karan, describing the state of ecommerce in India.

He goes on to share about the inventory management as well, “We have a mix of both inventory & no inventory. Our breads, fruits & many other items are bought on a daily basis. The other items are held in a central warehouse. We maintain our entire inventory online & are closely monitoring the stock movement. Each bill is handpicked by the packaging team & we know beforehand if we need to call for last minute orders with our suppliers.”

 The Challenge

“It had been challenging to convenience suppliers with our business model. But over time with our business doing well, they are not only confident & but also extend full support to us,” says Rashi.

There are many challenges with this industry, as they deal with food; you have to be extra careful with handling & stocking of the products. They have to monitor expiry, damages constantly. “There are 5 levels of checks put in place before we send the shipment to our customers. Also, there are countless number of brands & products available in the market, deciding which to keep is challenging itself,” adds Rashi.

Mumbai as a location is a challenge for them. The labor rates are high, cost of transport is high, margin in the industry is lower, and the traffic is erratic. But, then, this city lures them with the mere size of the market. Being linear in its shape, it is beneficial for them as they can keep a few stocking points and cater the entire city.

In the first week of their launch they have had achieved their monthly projection. Today, they are catering to a customer base of nearly 5000 & doing an average of 125-150 orders a day. Despite the fact that a minimum order of Rs500 is required, their average billing is close to Rs 1600.

Call the Banyas from LocalBanya, today!