Locking horns with cash-rich Reliance and well-funded startups, like Zepto and Blinkit, The New Shop aims to accelerate the adoption of convenience retail in India
The New Shop is aiming to set up 10,000 stores, which would operate 24*7, across India in the next 7-8 years
The startup is banking on its cost-efficient model and 360 degree experience for customers through integration of physical retail with technology for expansion
The word quick commerce has become a part of daily language over the last year or so. As the buzz for 10-minute delivery grew, investors lined up to get a stake in quick-commerce startups, like Zepto, Blinkit, and BigBasket, and their valuations zoomed. However, as the physical retail stores opened up with the waning effect of Covid-19, many questions were raised on the sustainability of the quick-commerce startups and their high cash burn.
Only time will tell about the future of quick-commerce delivery startups, however, there is one startup which is further trying to disrupt the consumer market, albeit in a different way. Delhi-based omnichannel convenience store startup ‘The New Shop’ is aiming to set up a network of its 24*7 stores across the country.
Founded in 2019 by the brother-sister duo of Charak and Aastha Almast and their friend Mani Dev Gyawali, The New Shop (TNS) has raised $720K till date from a bunch of angel investors. Besides, the startup is also in talks with investors to raise a larger Series B round.
Taking cues from countries like the US, China, Japan, and, more recently, Indonesia, the startup aims to accelerate the adoption of convenience retail among India’s young population. As the young working population in these countries took to 24*7 retail stores, large giants like 7-Eleven, Alfamart, FamilyMart, Speedway, Casey’s, and Circle K were born.
TNS is solving a huge issue for customers – delivery of food and essentials, particularly at night hours between 8 pm and 8 am, according to Charak Almast and Gyawali. Night deliveries account for more than 60% of the sales of the startup, they said during an exclusive interview with Inc42.
However, 24*7 is not exactly a new idea in India now, especially with corporate giant Reliance signing a master franchise agreement with American 24*7 convenience retail network 7-Eleven for India last year. Competing with cash-rich Reliance and well funded quick-commerce startups will not be easy for TNS.
However, its cofounders are betting on cost efficiency, franchise model, and first-mover advantage to help the startup navigate the initial challenges and reach its target of setting up 10,000 stores across the country in the next 7-8 years.
“The target market for TNS is huge. The market in India for convenience stores is huge. As per a recent study, it foresees 1 Lakh possible convenience stores within India,” Gyawali said.
The startup currently has over 50 outlets in Delhi-NCR, Mumbai, Lucknow, Ahmedabad, and in some parts of UP and Haryana. It is now planning to expand to more geographies in UP, MP, Haryana, Gujarat, Karnataka and Maharashtra.
Cost Efficiency At The Core Of Business Model
India’s $1 Tn retail industry is ripe for technological disruption even as ecommerce is rapidly expanding its reach within the country. Both retail and e-commerce companies are trying to penetrate the huge market. However, this requires a large capital infusion for leasing stores, hiring manpower, inventory management, offering discounts, acquiring customers, among other things.