Brief:

Zepto is an Indian quick commerce platform offering grocery delivery within 10 minutes.

Offerings:

Extensive selection of groceries (over 7,000 products) across various categories like fruits & vegetables, household items, personal care products, and more.

Delivery within 10 minutes from strategically located dark stores.

Funding And Valuation:

Zepto has raised a total funding of $591.25 million across 5 funding rounds.

Zepto raised $200 million at a $1.4 billion valuation, becoming India's first unicorn in 2023.

Revenue Model:

Zepto primarily generates revenue through two channels:

Commission on Sales: Zepto charges a commission on every order placed through their platform. This commission is likely a percentage of the total order value, similar to other online marketplaces.

Delivery Fees: While some reports suggest a free delivery option for orders exceeding a minimum amount, Zepto might also charge additional delivery fees depending on the order size and location.

Value Proposition:

Zepto differentiates itself by focusing on ultra-fast delivery speeds. Targeting convenience-conscious urban consumers, it caters to the need for immediate grocery fulfillment. Their app boasts a user-friendly interface and offers various payment options. 

Profitability:

Losses: Despite a significant revenue increase (reportedly 14.3x YoY in FY23), Zepto continues to experience losses. These losses more than tripled year-on-year to ₹1,272.4 Cr (approx. $158 million) in FY23.

Focus on Profitability: Zepto is actively working towards profitability. They've introduced a small platform fee (₹2 per order) and a loyalty program ("Zepto Pass") to increase customer spending and potentially reduce reliance on discounts. They aim to achieve EBITDA profitability (profit before interest, taxes, depreciation, and amortization) in 2024.

Competition:

Swiggy Instamart: Owned by Swiggy, a major food delivery platform in India. Offers grocery delivery within minutes, similar to Zepto. They leverage Swiggy's existing delivery network and brand recognition.

Blinkit (formerly Grofers): Another major player in quick commerce, offering grocery delivery within minutes. They have a wider selection of products compared to Zepto and might have a larger customer base.

BigBasket: A well-established online grocery platform with a wider product range, including fresh produce, packaged goods, and household items. Their delivery window might not be as fast as Zepto, but they offer scheduled deliveries and potentially lower prices.

Amazon Fresh: Part of the Amazon ecosystem, offering grocery delivery with various delivery time slots. They leverage Amazon's established logistics network and might offer competitive pricing due to their larger scale.

DISCLAIMER: This blog is solely for educational purposes and not to offer any investment advice. Please do your own research or consult a financial advisor before making any investment decisions.