Amazon, Flipkart not on Mukesh Ambani’s radar; Reliance Jio readies platform to wire kirana stores

Reliance Jio, which has plans to foray into e-commerce, will not be taking on the likes of Flipkart and Amazon, at least initially. Instead, the company’s first project on which pilots have started is to build a B2B platform targeted at merchants who run grocery, fruits and vegetable stores in the neighbourhood markets. The company has termed it ‘Hybrid Online-to-Offline’ platform. At a later stage, this B2B platform would be connected to the MyJio app and thus provide the B2C interface also.

Sources in the know said the B2B platform, for which an app has been developed, will require kirana merchants to become members of Jio Prime after which they can procure groceries, fruits, and vegetables by placing orders on the app, and the platform will take care of their full inventory management.

From Jio Prime, not only will these merchants be able to source products cheaper than from normal suppliers and distributors but will also get cash backs and other discounts which would enable them to compete with bigger, organised retail players who now operate in this segment.

“The kirana stores have a great relationship with consumers in their neighbourhood but they lack pricing power, which they will get by joining the Jio Prime platform,” a source said. The benefit for the merchants who join the platform would be that they would get access to the mobile customer base of Jio to whom they can send store merchandise details and offers.

The platform would also provide them complete inventory management, software tool for GST, etc without any effective cost burden which would help them manage their working capital in a better manner. They can then run promotional programmes like loyalty coupons, discount coupons etc as bigger, organised retails stores do.

A pilot is currently going on this project in cities such as Mumbai, Pune, Kolkata, and Ahmedabad and would gradually cover other cities.

Once the B2B platform is fully developed and starts running with merchants on it, Jio would in the second stage bring in its B2C model wherein these merchants will be integrated on its MyJio App. Since the MyJio App is accessible to the consumers, they can order products from these merchants.

“Customers can order from any of the nearby kiranas/merchants listed on the app, make online payments, get instant deliveries. They will also be able to place orders for items which are not part of the kirana’s inventory because these items could be delivered the next day as it would be fulfilled by the dealer to the kirana,” a source said, explaining how the model would work and benefit both the consumers and the kirana merchants.

At the Reliance Industries’ annual general meeting in July last year and subsequent events, chairman Mukesh Ambani had spoken about Jio’s foray into e-commerce and building of an online-to-offline model. “As Reliance transitions to become a technology platform company, we see our biggest growth opportunity in creating a hybrid, online-to-offline new commerce platform,” he had said, adding: “We shall create this by integrating and synergising the power of Reliance Retail’s physical marketplace with the fabulous strengths of Jio’s digital infrastructure and services.”

A Reliance Jio spokesperson did not respond to a detailed questionnaire sent on the subject.