Shift in consumer buying habits for meat gives online sellers a boost amid pandemic

'FreshToHome' has changed the traditional buying behaviour of consumers. Through its online platform, fish, chicken and other such products are delivered fresh at doorstep. The pandemic has supplemented the growth trend with many buyers opting for this online platform. In an exclusive interview with Bizz Buzz, Shan Kadavil, Co-founder and CEO of FreshToHome said that the company has entered into new categories like dairy, fruits and vegetables and has seen the user base growing by two folds in last three months. It is very close to get breakeven with rising user base. The company has raised around $121 million through a series C round of funding last year

This pandemic, all food-tech players have seen surge in demand. How has the overall business performed for 'FreshToHome' during this period? Also, have operations of the company get affected during the second wave of Covid-19?

The second wave has hit all of us hard with our families getting affected. However, business has been spectacular during this period. Customers' buying behaviour has changed due to the pandemic. Also, we don't see any change in this behaviour in the post pandemic period. Because in March-April 2020, we saw a sudden surge in demand, which came down a bit after the first wave. But this came back to the previous level eventually. This year also, we see a small percentage of people dropping back. But, in general, our registration levels are above 90 per cent. So, the behaviour will continue. People were not used to buying fish and meat from online route. They were used to get products that were caught in front of them. However, the issue of freshness has been answered from the kind of products that we deliver. The hygienic way in which the product (fish & meat) gets procured, processed, leads to customer delight.

How many transactions 'FreshToHome' is doing now? What's the run rate?

We are currently doing around two million orders per month. As far as volume is concerned, we are doing close to 50 tonnes per day right now. Unlike the first wave, we are more prepared this time with regard to supply chain. In the first wave, many things had come to a halt. We have managed it pretty well this time.

Can you throw some light on the downward linkage as part of which the company is directly connected with fish growers, poultry and goatery?

We have around 1,500 to 2,000 vendors in our platform. We are making middlemen redundant. In this process, we are able to give more money to fishermen and farmers. We are giving around 20 per cent higher than the usual because we are able to cut a number of middlemen. At the end, we are able to serve better products to the consumers.

Has your expansion plans been on hold due to the pandemic? How many cities are you planning to expand as the second wave fades?

We are expanding quite rapidly. Our last expansion was in Hyderabad. Kolkata is the next city we are looking at. Right now, we are present in 10 cities and we are looking to expand it to 22 by end of this year.

What are your plans as far as new launches into categories are concerned?

We are looking at new categories. Under this initiative, we are specialising in fruits. Currently, we are delivering milk, fruits, vegetables and other essentials. Around six lakh litres of milk per month are sold through this platform in Bangalore. This is the next scheme of things for us under which we intend to deliver all things fresh. We stick to our philosophy of not using any chemicals or preservatives. We are looking at launching a bunch of other categories like processed food. Currently, fruits, vegetables and dairy products are available in Bengaluru, Pune and Hyderabad and we will take it to other cities in the next phase.

The demand for our new products is also very high. The daily app (FTHdaily) has seen two fold growth in last three months.

In vegetables, fruits and other such categories, competition is intense with many players operating in the space. How do you view this fact?

Our strength is supply chain, which is powered through technology. Every produce is maintained at 0- 4 degree centigrade and we deliver our products fresh to the end consumer. We want to take advantage of that strength which may not be the fact with other players. Also, our engagement with fishermen and farmers is also high, enabling us to deliver better quality products.

How technology is leveraged in enabling smooth operations at 'FreshToHome'?

We are primarily using technology in optimising how to source, where to source our products in the platform. We don't source directly and source through marketplace vendors. Data is intelligently used for effective trade to happen. Because of our predictive technology, we are able to reduce our waste to only 1.5 per cent from usual 15 per cent seen in this space. Similarly, our IoT (internet of things) is helping us to carry our produce through controlled technology.

Secondly, we are ensuring some of the good technological practices related to aquaculture, fishery and other areas for our platform vendors. Using our information, they are able to do intensive aquaculture, leading to high quality produce. We also giving guarantee in buying back the produce.

What is the share of revenue coming from fish, chicken and meat?

Around 40 per cent of the revenue is coming from fish. Roughly around another 40 per cent is coming from chicken and the rest from other produces.

Are you breakeven now? What are your plans as far as entity-wise profitability is concerned?

We are breakeven now in Delhi and Bengaluru. Over a period of time as volume goes up, we will achieve this in other cities. Though we are entering into new categories, we are very close to be profitable entity-wise. We raised a large round ($121 million in series C) last year. We have enough capital and we are not in a hurry to raise capital.