Professional Documents
Culture Documents
Assumptions
2 Tier-3 and Rural cities are ignored as this would not be practical
consideration to begin with.
Since its the starting phase for a company its unlikely to start
3 businsess in all 75 Tier-2 cities,hence assuming only close to 30%
of these cities into being part of initial operations. (I,e 20 tier-2
cities)
Peak hours for a kirana store is considered as (6am-9am) and
4 (5pm-8pm) total of 6hrs. Non-peak ours are considered to be 8
hrs.
From the given data on mean annual income the Tier-2 people
income is about 2/3 of that of Tier-1, and the goods price such as
7 vegetables, fruits are cheaper than the Tier-1. Hence I'm assuming
the average price per order to be 2/3rd of that of Tier-1, which
results in 60rs(1$) for small stores and 130rs(2$) in medium
stores.
Formula Total No of kirana stores of a given size in a given Tier cities = (No. of
kirana stores per sq.km) x (% share of given size store in Tier-#)
Average sales in Tier-2 small sized store per day in dollars = 2/3 x Av
=100
Average sales in Tier-2 small sized store per day in dollars = 2/3 x Av
200
Cities Stores
Source
http://www.thehindubusinessline.com/news/variety/dig-through-the-data-
goldmine/article4949282.ece
http://shodhganga.inflibnet.ac.in/bitstream/10603/69868/13/13_chapter%204.pdf
https://yourstory.com/2016/02/hyperlocal-services-tier-2-cities/
https://www.quora.com/What-is-the-business-model-of-Grofers-How-do-they-optimize-their-delivery
http://www.thehindubusinessline.com/news/variety/dig-through-the-data-
goldmine/article4949282.ece
Tier cities = (No. of Tier-# cities) x (Average area size in sq.km of Tier-# city) x (Average No.of
Tier-#)
8
20
Peak Hours(6am-9am/5pm-8pm)
6
1
12
72
72 + 28=100
1.5
150
Peak Hours(6am-9am/5pm-8pm)
6
1
12
72
72 + 28=100
3
300
dollars = 2/3 x Average sales in Tier-1 small sized store per day in dollars = 2/3 x 150
dollars = 2/3 x Average sales in Tier-1 small sized store per day in dollars= 2/3 x 300 =
150
300
100
200
7% of 38.5M
2.7M
arket Sizing
No.of kirana Stores
938340
505260
1012500
337500
938340 5%
505260 15%
1012500 2%
337500 10%
Average sales per day with grofers(digital
No.of Kirana stores platform)= # of Stores with Digita
with Digital Platform platform x Average Sales per day
46917 7.03M
75789 22.73M
20250 2.02M
33750 6.75M
Total 38.53M