Google-backed Dunzo GMV neared ₹600 crore from 8 cities in FY21, CEO says they'll start expanding now
Dunzocurrently operates in eight markets and plans to get into 20 more by 2023.
- It has reduced its expenses per rupee of operating revenue from ₹13 in FY20 to ₹6 in FY21.
- It caters to over 2 million orders on a monthly basis and reported a GMV of $200 million in FY20.
AdvertisementGross merchandise value (GMV) of quick commerce app Dunzo neared ₹600 crore in the financial year 2021, even though the Google-backed company reduced its marketing spends and did not enter any new cities in the last fiscal year.
The company currently operates in eight cities — Bengaluru, Mumbai, Pune, Gurgaon, Delhi, Chennai, Hyderabad and Jaipur. It caters to over 2 million orders on a monthly basis.
The company's revenue jumped 66% to ₹46 crore. It has reduced its expenses per rupee of operating revenue, from ₹13 in FY20 to ₹6, in FY21, the company added. The company claims that their revenue grew due to increase in organic demand and being an essential service during the pandemic.
Founded by Dalvir Suri, Mukund Jha, Kabeer Biswas and Ankur Agarwal in 2015, Dunzo connects users with vendors like grocery stores, pharmacies, restaurants and more to facilitate delivery of products. It also allows its customers to facilitate deliveries amongst themselves and hire a partner to fulfill pick-and-drop orders.
Kabeer Biswas, chief executive and cofounder of Dunzo, told Business Insider in an interview that the company did not carry out any expansion activities in the last 15-18 months. “We didn’t want to go ahead and try to understand operations and go ahead and create issues on the ground because of us entering new cities. We didn’t know what the regulation would look like, we didn’t know what the virus would look like,” he added.
Dunzo will resume its expansion plans in the later half of this year. Though the company is yet to finalise the nitty-gritty of the plan, it aims to enter 10 new markets by 2022 and 20 markets by 2023. The company plans to launch a pilot programme in Tier II city, a market with less than 10 lakh population, to test out the demand for their services, Biswas told Business Insider.
Biswas also added that Dunzo recorded a GMV of ₹267 crore between April and June, this year.
The seven-year-old startup expects to continue its growth trajectory in FY22 as well, fuelled by its quick commerce segment.
What’s up next for Dunzo?
Dunzo has raised close to $130 million to date from marquee investors like Google, Lightbox, Evolvence India Fund, Lightrock, Alteria Capital and more.
The company is now looking to launch 300 micro-fulfillment centres across 700 neighbourhoods with a focus on express grocery delivery. The company also launched its
Biswas highlighted that grocery and essential items currently make up around 80-85% of Dunzo’s business in terms of GMV.
The company now aims to expand Dunzo Daily with 2,000 stock keeping units (SKU) and scale it to top 20 cities in the next 18 months. The company claims that it is their most ambitious category till date.
“What it does is, it goes ahead what a convenience store in 2021 would look like. I think what we are very excited about is the first 5 million odd customers in Bengaluru to try it and about 40 million customers across the country to try it over the next two years,” Biswas told Business Insider.
Biswas noted that the major challenge to Dunzo Daily is the fact that it requires the company to operate as three businesses at once — a tech company, a logistics company and a retail company. “As a logistics company that’s just connecting people, your retail behavior understanding can be slightly low,” he said, adding that the company has been trying to understand retail behaviour in the last 15-18 months.
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