Swiggy shuts down gourmet grocery delivery platform Handpicked

• ByStartupStory     |    May 2, 2023

Swiggy, the foodtech decacorn in India, has shut down its gourmet grocery delivery vertical, Handpicked, due to external market pressures affecting the country’s startup economy. The move is part of Swiggy’s efforts to streamline its business and offer unparalleled convenience to consumers. Although Handpicked was being piloted in select zones in Bengaluru, the company decided to close the vertical after gaining positive learnings from the experiment. Swiggy’s spokesperson confirmed the news to Inc42, highlighting the company’s continuous experimentation with new propositions in line with its vision.

Although Swiggy has closed its gourmet grocery delivery vertical Handpicked, users can still order groceries via Swiggy’s Instamart and InsanelyGood platforms. InsanelyGood is the rebranded version of SuprDaily, which was launched earlier this year in March. Handpicked, which was an invite-only platform, offered premium products that were either imported or locally made. 

The platform aimed to bring a catalogue of products that were difficult to find in Indian stores, whether offline or online, including Coca-Cola Cherry, which is only available in the US, and kombucha made by local breweries. Despite the positive response to Handpicked, Swiggy made the decision to close the vertical as part of its efforts to streamline its business and offer unparalleled convenience to its consumers.

Unlike Swiggy’s quick commerce vertical Instamart, which delivers groceries in 15-50 minutes, Handpicked, Swiggy’s now-closed gourmet grocery delivery vertical, only offered next-day delivery. However, at the time of its launch in December 2022, Swiggy had touted Handpicked as a platform that would help customers discover and purchase unique and interesting groceries that were not easily accessible, including global favourites, regional delights, and local legends.

 Swiggy’s decision to launch Handpicked appeared to be a rational one, given its incremental gains from grocery delivery. In FY22, Swiggy’s sale of services earned INR 3,444.4 Cr, representing an increase of 83% from INR 1,878.9 Cr in FY21. Although Handpicked has now been closed down as part of Swiggy’s efforts to streamline its business, users can still order groceries from Swiggy’s Instamart and InsanelyGood platforms.

In FY22, Swiggy’s sale of services generated INR 3,444.4 Cr, with INR 87.5 Cr earned from food sales and INR 2,035.6 Cr from the sale of traded goods through Instamart. However, the closure of Swiggy’s gourmet grocery delivery vertical Handpicked suggests that the company failed to achieve a good product-market fit with the platform. While competitors like BigBasket also offer gourmet products, they have limited such products to a small section of their larger product range. Swiggy could potentially follow a similar approach in the future.

Swiggy’s decision to close its gourmet grocery delivery vertical Handpicked comes at a time when the foodtech decacorn is trying to catch up with Zomato, the only other incumbent in this segment. Zomato has captured the majority of the market share and is operating with better margins than Swiggy. To diversify its grocery and other traded goods delivery verticals, Zomato recently launched Maxx, a platform that delivers toys, electronics, gadgets, and home and kitchen essentials in under an hour. 

Meanwhile, Swiggy plans to add categories such as beauty and grooming, essential clothing, gardening, furnishing and décor, and health and fitness, as it takes on established players like Amazon and Flipkart. However, Swiggy has also made some tough decisions in recent months, including selling its kitchen infrastructure business Access to Kitchens@ in March and shutting down private label The Bowl Company in Delhi NCR late last year. Additionally, the company laid off 380 employees earlier this year as part of a restructuring exercise.

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