Expansion of Zepto dark store to support non-grocery deliveries

What’s the story

According to a Mint report.

The move is part of the online grocery platform’s strategy to delve deeper into non-grocery deliveries.

The four-year-old startup, which enjoys great interest from investors, plans to open one or two large warehouse facilities in the largest cities in the coming months.

New facilities that will serve as storage centers for high-value items

These new facilities will function as delivery hubs for high-value items such as electronics, home appliances, gifts and luxury goods such as gaming consoles.

While Zepto currently offers some of these categories in several cities, larger stores will allow it to stock more SKUs, which is not possible in smaller grocery stores.

The company also plans to use these larger stores to restock smaller, dark stores located within a 2km radius in most major cities.

Zepto’s strategy is shifting towards non-grocery deliveries

“Zepto is slowly adopting the Swiggy Mall and Blinkit model of operating specific non-food stores and more small FMCG stores,” one source said Mint.

“While Zepto is making progress in increasing e-commerce sales, its focus will remain on high-speed trading.”

The company had considered creating a separate tab on its smartphone app for e-commerce orders, similar to Swiggy’s Mall feature, but decided to scrap the idea to maintain its commitment to 10-minute grocery orders.

Fast-trade companies are looking for higher revenues on non-grocery items

Fast-trade companies are increasingly focusing on non-grocery items due to large ticket sizes that help increase the value and volume of orders.

Consumer brands are also benefiting from this strategy, with fast trading platforms becoming a key sales channel for many.

For example, Honasa Consumer reported last month that sales through fast trading are outperforming traditional e-commerce platforms.

Zepto’s financing journey and future plans

Founded in 2021 by Aadit Palich and Kaivalya Vohra, Zepto quickly rose to prominence after securing over $150 million in funding from high-profile investors such as Y Combinator and Nexus Venture Partners within months of its inception.

The company achieved unicorn status last year after raising $200 million in Series E financing led by US private equity investor StepStone Group.

Zepto is currently looking to raise around $650 million at a valuation of $3.5 billion.