Online grocery store BigBasket, aiming to double its customer base to 20 million by 2020, is planning to invest up to Rs 500 crore into strengthening its technology and back-end farmer supply chain, according to the Mint.
The company, which is currently working with 1,800 farmers, is also aiming to increase the farmer base to 5000 under its back-end farmer supply chain programme called Farmer Connect.
“We ensure they get better prices, paid on time. About 85 per cent of our produce comes directly from farmers and we are going to strengthen that. We work closely with hotels, and restaurants as well as nearly 2,000 kirana stores,” said Hari Menon, co-founder and CEO of BigBasket.
The co-founder also claimed that last year, the company became operationally profitable in two cities such as Bengaluru and Hyderabad. Besides, it is now looking to become operationally profitable in Kolkata, Chennai, Ahmedabad and other cities in the next few months.
BigBasket reported revenues of Rs 1,090 crore in FY17, which is a 107 per cent jump from Rs 527 crore in the previous fiscal. Meanwhile, losses increased to Rs 191 crore last fiscal, compared to Rs 103.4 crore in FY16.
BigBasket now hopes to close the current fiscal with sales of over Rs 2,000 crore.
Last month, Chinese e-commerce giant Alibaba Group Holding, which is going to acquire a stake in the e-grocer, had got approval from the CCI (Competition Commission of India).
Alibaba and BigBasket are in talks to square a deal of over $300 million which could be materialised in the coming days. According to the report, Paytm Mall is also likely to invest in BigBasket as part of the deal and will hold about 35-40 per cent stake in the grocery etailer along with Alibaba.
In October this year, the e-grocer picked up two rounds of investments. The online grocery firm raised Rs 52 crore from its four existing investors, including UAE-based Abraaj Basket, Bessemer Venture Partners along with International Finance Corp and Sands Capital. The funding came on the back of raising another Rs 38 crore in two tranches from Helion Ventures and Trifecta Venture in the same month.