Increase in E-Commerce Penetration coupled with Development of Infrastructure - Dark Stores and Micro Fulfilment Centres across The Archipelago Will drive the Indonesia Online Grocery Market

Ken Research

• The online grocery penetration in total grocery market is expected to grow and reach to more than 3.0% by the end of 2026.
• Post Covid-19 outbreak average basket size of online order has increased, as people spent more time at home Food category accounted for about 15% of overall expenditure allocation followed by healthcare.
• To enable quicker deliveries service providers might adopt technologies such as drone deliveries, warehouse automation, and voice ordering and ordering/searching by taking a picture in the app.

GURUGRAM, India, Aug. 10, 2022 /PRNewswire/ -- 

Impact of Covid-19:  Companies witnessed a double-digit growth across all essential product categories namely water, fresh fruits, vegetables, health & nutrition, household supplies during the Covid-19 pandemic. Companies experienced a surge in average order size as customers were shopping in bulk. In order to fulfil the increased demand, companies expanded their delivery fleet by partnering with third party delivery companies to manage last-mile logistics. In addition to this, companies are also partnering with delivery fleets of bike ride hailing apps such as GoJek (GoRide) and food delivery companies to ensure door-to-door delivery.

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Expanding Partnerships: It is anticipated that e-grocery companies would be extending tie ups with suppliers, grocery stores (hypermarkets, supermarket), food delivery companies, e-wallet companies and other fintech firms to leverage their capabilities to fulfil consumer orders. Other future strategies which the companies might adopt are Introducing express delivery, regional expansion, product portfolio diversification, focus on achieving operational efficiency and establishment of dark store and micro-fulfilment centres. 

Application of AI: Drone Technology, Voice Ordering, Artificial Intelligence & Machine Learning, Warehouse Automation is anticipated to drive the online grocery market in future. AI & Machine learning technologies can be used to provide a personalised shopping experience to the customer. As the industry is in growth stage a strong supply chain accompanied by enhanced demand prediction and consumer behaviour analysis is crucial to ensure sufficient availability of products timely delivery of the fresh produce at minimum wastage.