SCIS 2024 Day 6 - The importance of darkstore in e-groceries

Summary

The speaker, Nabil Rajanik, shares his experience working in the groceries sector, particularly at an online grocery platform called Segari. He discusses the importance of delivery time in the e-grocery market and how it compares to competitors. Nabil explains the transition from a centralized to a decentralized supply chain model, implementing 'Dark Stores' to enhance delivery speed. He also talks about the challenges of managing inventory across multiple locations and the impact of these changes on the business, including increased GMV and improved operational efficiency.

Takeaways

• 😀 The speaker, Nabil Rajanik, shares his experience working in the groceries sector, specifically at an online grocery platform called 'segari'.
• 🏪 'Segari' is described as a home-based supermarket, focusing on fresh products like fruits, vegetables, meat, and household needs, with a motto of 'supermarket at home'.
• 📍 The service area for 'segari' is initially limited to the Jabodetabek area, but the speaker suggests that it might expand as they grow.
• 📈 The speaker discusses the importance of delivery time in the online grocery business, noting that 'segari' initially offered next-day delivery but has since improved to same-day in certain areas.
• 📦 The initial centralized supply chain model for 'segari' involved all products coming to a processing center before being sent to customers, which took at least one day.
• 🛒 To improve delivery times, 'segari' invested in 'Dark Stores', which are fulfillment centers closer to customers, allowing for faster delivery.
• 📊 The speaker highlights the need to balance efficiency and agility in operations, using data to determine the best locations for Dark Stores based on order density.
• 📈 The implementation of Dark Stores allowed 'segari' to increase the number of SKUs offered and improve the overall GMV by 40%.
• 🔄 The transition to Dark Stores also presented new challenges, such as managing independent inventory across multiple locations and ensuring efficient use of space.
• 💹 The impact of these changes includes faster delivery times, increased sales, and improved operational efficiency, with some stores becoming profitable.

Q & A

What is the main topic discussed in the script?

The main topic discussed in the script is the experience and challenges of working in the groceries sector, specifically focusing on the online grocery platform 'segari' and its transition to a more efficient delivery model using 'Dark Stores'.

What does the speaker suggest is the importance of 'D' in their workplace?

The speaker implies the importance of 'Data' in their workplace, as they later discuss using data-driven approaches to optimize the location of fulfillment centers.

What is the meaning of 'segari' as described in the script?

'Segari' is described as an online shopping platform that focuses on selling fresh goods such as fruits, vegetables, meat, and household necessities, aiming to be a 'supermarket at home'.

What was the initial delivery service model of segari, and how did it compare to competitors?

Initially, segari offered a 'next day delivery' service, which was the longest compared to competitors. The script mentions competitors like 'si merah', 'si hijau', and 'si biru', with the latter able to provide delivery within 15 minutes.

What is the concept of 'Dark Stores' introduced in the script?

'Dark Stores' are described as invisible supermarkets, where orders are fulfilled and shipped directly to customers from the closest warehouse without a retail storefront being open to the public.

How does the implementation of Dark Stores affect the delivery time for segari's customers?

The implementation of Dark Stores allows segari to offer faster delivery times, with the ability to provide same-day delivery and even priority orders within 30 minutes in certain areas.

What challenges does the speaker mention regarding the increase in SKUs for segari?

The speaker mentions that having a limited number of SKUs could be a factor in changing customer behavior towards online shopping. If the variety of products is not comprehensive, customers may be less inclined to shop online.

How does the speaker propose to balance efficiency and agility in the company's operations?

The speaker suggests using data analysis to determine the best locations for Dark Stores, considering factors like order density and the need for efficient inventory management to balance efficiency with agility.

What impact did the transformation to Dark Stores have on segari's business?

The transformation led to a significant increase in delivery speed, an increase in the number of SKUs offered, and a drastic increase in GMV by 40%. It also improved the operational PNL and revenue per square meter.

What is the speaker's hope for the future of segari after implementing these changes?

The speaker hopes that by aggressively implementing Dark Stores and improving operations, segari can contribute to the overall company profitability and move towards a positive direction, with some stores already achieving profitability.