Karan Mehrotra, Managing Director of Localbanya.com, talks about his business objective and goals in conversation with Sarita Gujar. Edited excerpts:

Localbanya.com is one of the first online supermarkets operating in Mumbai. What inspired you to begin an online retail business?

The idea for LocalBanya.com arose from our personal experiences with shopping for groceries. More often than not after working for long hours, we were simply too tired to spend 2-3 hours in a crowded supermarket. We looked around and could not find a service that would do what LocalBanya does. So we decided to work on a business plan and took it from there. The response has been fantastic and we are glad to see so many people use our service to their benefit.

Is your business model any different from the numerous online retail businesses that have been established in recent times? What are the USPs of your offerings?

People are looking to stock up or top up on groceries and household items in their orders. Given the nature of this type of purchase, we have had to develop a unique model to ensure maximum customer satisfaction. Our customers are able to select not only the day they want the order delivered but also a time slot of their choice. As a result, our customers are able to plan their purchases more effectively.

Selection-wise customers have the luxury of choosing from over 14,000 products including a wide range of organic, imported foods and specialty items in addition to typical everyday needs. Our hassle free returns policy adds a level of comfort to the shopping experience as customers can return items if the need arises.

There are already several big players in both the brick and mortar and online retail space that are aggressively going for customer acquisition. How do you plan to retain and build your customer base?

Initially, we saw great traction through word of mouth in building our customer base. As we now look to scale up, the use of print media and other formats of advertising will play a vital role. The online grocery industry is still very new and we have the task of changing people's shopping habits. One of our goals is to get people to try our service and experience the convenience that comes with it. Our communication reflects this and we employ a mix of brand and occasional deal based messaging to get people to try our service. Customer retention is something that is earned over time. We need to ensure a great overall shopping experience every single time to keep people coming back.

FMCG products throw up challenges like quality, shelf-life, etc. How to manage these challenges in delivering quality services to customers?

At LocalBanya we are constantly looking to improve operational efficiency and develop stringent and rigorous checks. We have in-house systems in place that handle product related data like shelf-life concerns. The aim is to ensure customers receive high quality products in their order at all times. Through experience and upgrades we now have a system in place that virtually eliminates such issues. On top of that, if for some reason a customer would like to return products due to quality issues they can do so.

In this era of rampant price war, are you able to offer a good proposition to customers?

Customers that shop for groceries online are looking to reap not only the price benefits where available but also the convenience that comes with not having to spend hours every month in crowded supermarkets. Our offer management and procurement teams come up with a wide range of deals and offers from time to time that we pass onto our customers.

Our customers are able to save money month on month with their purchases. Customers also earn Banya points with each purchase which they can redeem on future orders. We focus on building the best shopping experience for our customers through working with our vendors to pass along savings where possible. While we are always aware of what our competition is doing, we avoid getting into price wars as that is really not beneficial in the long run.

What kind of customers do you cater to? Buyers who demand goods immediately or buyers who plan and order well in advance? Tell us about consumer demographics.

LocalBanya has an appeal to a wide range of people demographically. Women from all walks of life between the age of 30 and 35 make up a significant percentage of our userbase, but we have seen solid growth in the senior citizen and young professional brackets as well. As mentioned before, the benefits of shopping online for groceries is something that would benefit almost any online consumer and we look to provide our service to as many people as possible.

We do offer same day delivery to our customers but we have seen that people tend to plan their big grocery purchases on a schedule. The beginning of a month for example sees larger cart sizes with people stocking up for the month. Subsequent purchases tend to be top-ups for the household or in response to any deals that are running at the time.

What is the minimum shipping period to send across the products to the customers?

Our customers have complete freedom in choosing the delivery of their orders. We accomplish this by offering them the choice of day as well as time slot during the checkout process. Deliveries are done over 6 daily time slots starting from 7 am and going to midnight. If for any reason, the customer needs to edit or change a delivery, it can be done very easily through customer service.

Where do you see localbanya.com three years down the line? Any plans to expand pan India?

We have plans of entering new metros very soon. Ideally, we would like to see LocalBanya become a household name to the Indian consumer. As a company, we are aiming to be a well - respected, innovative firm that is a great place to work and build a career.