Food delivery player Swiggy will soon deliver milk at your doorstep as it forays into micro-delivery space with the acquisition of Supr for $100 million. It is a subscription-based app that delivers milk and other essential food items. The deal, which was reportedly signed last year, would enable Swiggy to expand its delivery network, help in brand building and consolidate its food delivery services. Supr has been catering to over 1 lakh customers in Bengaluru, Mumbai and Delhi.
With this development, Swiggy would be able to deliver milk on a weekly, monthly or quarterly subscription model. Currently, 70 percent of the orders made on Supr are for milk delivery services.
"The segment Supr Daily is working in is serving such a necessity that it can be scaled up beyond the top 10 cities. Swiggy has made in-roads in rural markets and Supr Daily can be taken there too based on the convenience this model offers," sources told Economic Times.
Swiggy had also raised $1 billion by foraying into micro-food delivery space through Swiggy Stores and subscription-based home-cooked meal service Swiggy Daily. Swiggy will now directly compete with the established players in the space such as Milkbasket, Daily Ninja and the giant Big Basket. Swiggy also has the advantage of leveraging its huge logistics network and could subsequently expand services to rural markets. It currently caters to nearly 1.5 lakh customers, growing 10 fold over the course of six months.
The micro-food delivery space sees a total of 2.5-3 lakh orders per day on an average. The demand seems to be primarily among the urban working class people who opt for online food and essential services delivery. Around 60 per cent of the orders come from the gated communities.
Experts say that a majority of the startups in the micro-delivery space are growing enormously due to the convenience of doorstep deliveries and have been able to raise funds over the last few years from various venture capitals.