Online grocer Peppertap to shut operations in a month
The struggle to remain afloat in the online grocery business has just had its latest victim – Gurgaon-based Peppertap.business Updated: Apr 25, 2016 11:05 IST
The struggle to remain afloat in the online grocery business has just had its latest victim – Gurgaon-based Peppertap. This stockless app-based grocery delivery business will shut its business and turn its attention to focus exclusively on its e-commerce logistics business reports Yourstory.com quoting Peppertap’s co-founder Navneet Singh.
Details of the reasons for this drastic decision were not provided.
“Shutting down Peppertap is extremely difficult call for us but it’s the need of hour. Our foray into full stack logistics space is a well-pondered decision and our experience in consumer as well as business-focused logistics will certainly help us to build next generation e-commerce logistics startup,” Singh told Yourstory.com.
According to this report, lack of demand and unviable unit economics (viability of each transaction) led to Peppertap’s decision to shut its grocery delivery business and sacking of 200 of its employees.
In September 2015, PepperTap had announced closing its Series B funding of $36 million (Rs 238 crore). The latest funding and third round was led by e-commerce company Snapdeal along with existing investors Sequoia India and SAIF Partners. The funding also saw participation from new investors like Ru-net, JAFCO, and BeeNext. Additionally, PepperTap had also said it is in advance talks to expand this round by another $20 million (Rs 132 crore) which is expected to be closed soon.
Online grocery business in India has become increasingly challenging claiming even big names like Flipkart, that had piloted and just its Nearby branded grocery business in February. However in the same month, Flipkart’s most prominent rival Amazon had said that it was moving its grocery delivery business from pilot to full fledged commercialization under the Amzon Now banner.
From nearly 40 or so start-ups offering to deliver grocery at customers’ doorstep some 4 years back, the numbers has dropped to 3-4 now and none have started to report profits yet.