Blinkit Plans to Boost Dark Store Numbers by 40% in the Next Year
- ByStartupStory | February 13, 2023
Blinkit, a prominent player in the e-commerce industry, is planning to grow its micro-fulfilment centers or dark stores by 40% in the next year, according to CEO Albinder Dhindsa. As of now, the company, which was acquired by Zomato, an online food delivery firm, operates over 400 dark stores, which serve as warehouses.
“In our quest for expansion, we have pinpointed several new areas in current and new cities that exhibit high growth potential,” said Dhindsa in a statement regarding earnings. “As we move forward, we expect a rise in the amount of dark stores as a result of these emerging possibilities.”
He added, “We are actively seeking out locations for new stores that show high potential, as determined by our data systems, and are also considering factors such as our management resources and the time required to establish a supply chain.”
However, according to Dhindsa, the expansion of the quick commerce business is not as straightforward as the food delivery business, as it depends on various factors such as brand availability, seller capabilities, and supply chain efficiency.
“We only pursue opening new stores when we are certain that we can deliver an exceptional customer experience in a high potential location,” added Dhindsa. “At present, we believe that we can steadily grow our number of dark stores by approximately 30-40% in the next 12 months.”
According to Dhindsa, the success of this expansion plan will also depend on the company’s ability to identify the most cost-efficient locations that would best serve their needs.
According to Dhindsa, during the third quarter, Blinkit was less affected in comparison to the food delivery business as the purchases made through Blinkit typically consist of more essential items.
He mentioned that the slight decrease in average order value may be due to customers opting for smaller packs rather than larger ones during the slowdown. Nevertheless, he emphasized that the last quarter was a record high in terms of the number of new and repeat customers.
Blinkit generated a revenue of Rs 301 crore in the third quarter, ending December 31, 2022, which was a 28% increase from the previous quarter. The gross order value for the quarter was Rs 1,749 crore, demonstrating a growth of 18% compared to the previous quarter. Dhindsa highlighted that this growth was achieved without any expansion in their dark store network.
Regarding advertising as a potential source of revenue for Blinkit, Dhindsa stated, “We anticipate that advertising will play a major role in driving an increase in revenue per order in the future.”
In support of this vision, he mentioned, “In December 2022, we launched Blinkit Brand Central, our new self-service advertising platform for brands. The platform gives brands the ability to bid on keywords they are interested in and create personalized brand stores on the platform.”
Dhindsa mentioned that Blinkit has become a popular platform for advertising and engagement for over 500 brands. He added, “These brands, both established and emerging, utilize our platform to raise brand awareness and drive sales through performance advertising.”
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