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January 22, 2018

Alibaba Invests $200 Million in Bigbasket

Bigbasket is a grocery startup which has grown to be the largest online supermarket in India.

They recently raised $280 million in a funding round. $200 million of this was from Alibaba, who now owns a 25% stake in the company. They are also backed by the likes of Sands Capita and Abraaj Group, whilst Paytm has also expressed interest.

Who is Bigbasket?

Bigbasket supplies consumers in 25 cities with a variety with over 18,000 different products from over 1,000 different brands. Products include fresh fruits and vegetables, dried foods, meats, personal care items, cleaning products, kitchenware and more. They also deliver products from local speciality shops like bakeries and florists.

The company has been negotiating this investment from Alibaba for several months now. Before this, they had been in contact with Amazon.

Competition for the Indian grocery market is fierce between Alibaba and Amazon. Amazon has announced plans to invest $500 million in the market over the next few years!

Not only do these two giants have themselves to compete amongst, but also local companies like Snapdeal and Flipkart.

The competition is tough, and a number of grocery delivery startups have closed down in recent years. The trouble with growth is that the lack of logistics and infrastructure can make expanding outside of major cities almost impossible.

There is a very limited supply of warehouses and refrigerated vehicles, which are needed to safely store and transport food products. Amazon plans to invest heavily in logistics and infrastructure, and has already received approval from the indian government to make a food retailing investment in the country.

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