How to start an online grocery delivery business? Online grocery shopping is catching up with consumers rapidly. According to Orian Research, the global online grocery market would grow at a CAGR of 23.7% in the period of 2020 until 2025. 

One more research suggests that the grocery ecommerce business is expected to reach $250 Billion in the next five years.

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Everyone needs to eat, but not everyone likes to shop. In a world where the time crunch is constantly crunching harder, plenty of people happily pay to have someone else get their groceries. 

Like when starting any business, you’ll need to do market research, advertise and research local business licensing laws. But if you have a reliable vehicle and the time to drive, the service can be a money maker.

Things to Consider Before Starting an Online Grocery Business

How to start a profitable grocery shopping business.pdf? To get successful in starting and operating an online grocery business, you need to focus on the following factors:

  • Selecting and enhancing (if required) grocery business model 
  • Creating a roadmap to transform the business model into an agile, efficient and a precise operating model
  • Determining the target market 
  • Segregating the delivery regions
  • Competitor analysis
  • Grocery website and mobile apps

Out of all these factors, entrepreneurs or business owners often waste so much time and resources in choosing the suitable grocery business model.

Read also: Realistic Objectives of Online Businesses in the Philippines

Different Business Models Of Online Grocery Industry

Grocery home delivery business plan? Going out to local stores everyday to buy groceries can be challenging. People are caught up in their busy schedules and rarely find time to visit stores and buy food. Given the fact that everybody has mobile phones with them all the time, the emergence of online grocery ordering and delivery businesses was obvious.

Online delivery businesses are thriving across the globe. Be it grocery on demand, food on demand or other services, the on demand economy is just booming.

Instacart: Hyperlocal Grocery Business Model

How to start a grocery delivery business? Instacart is another prominent name in the arena of grocery delivery service providers. Its unique selling point is rapid delivery. Being a hyperlocal grocery delivery platform, Instacart connects customers with personal shoppers who are responsible for door-step grocery order delivery. It works on a 3 tier customer strategy, where buyers purchase grocery orders online via the application of Instacart. 

Business Model of Instacart at Glance (Buying and Dispensing)

Grocery Retail Partners: Grocery vendors who have a contract with Instacart to list and sell their grocery items through the platform.

Instacart Shoppers: Instacart shoppers shop for groceries as per buyers’ requirements and then deliver it to them.

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Fresh Direct: Inventory Business Model

The main USP of Fresh Direct is to deliver fresh groceries to its consumers. By using the Fresh Direct app, customers can order groceries with the click of a button. The order is later delivered to the customer’s doorstep by a refrigerated truck. Apart from customers, grocery suppliers, and Fresh Direct buyers, are the key partners of Fresh Direct.

Business Model of Fresh Direct at Glance (Buying, Warehousing and Dispensing)

Grocery Suppliers: By partnering with FreshDirect, grocery suppliers supply their produce like meat, seafood and poultry. Suppliers are also listed on the application of FreshDirect to showcase products to the relevant buyers.

FreshDirect Buyers: Buyers of FreshDirect, check and purchase fresh grocery supplies from suppliers. The stock purchased is taken to the warehouse of FreshDirect. All grocery items are stored in a temperature-controlled environment at the warehouse.

A refrigerated truck later delivers the order to the consumer. As FreshDirect follows just-in-time practice, the order is prepared only after being placed by a customer.

Peapod: Multi-Vendor Grocery Business Model

Peapod is one of the oldest grocery delivery services in the US. Following a hybrid approach, Peapod acts as a service provider like Instacart and an online supermarket. It offers fresh produce, meat, alcohol, refrigerated foods, meal kits, and more.

Though Peapod primarily fulfils orders through its warehouses, recently, it has partnered with grocery stores to provide delivery services. The company has ‘warerooms’ that are attached to the grocery stores where employees prepare and fill customer orders.

Operating as a multi-vendor marketplace, Peapod facilitates shipping and payments.

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Walmart: Omnichannel Business Model

With the integration of physical and digital storefronts, Walmart provides consumers with channel engagement as per preference. It operates as an omnichannel business model. Customers are seamlessly served via the website, mobile application and in store interactions.

Its essential resources include brick and mortar stores, eCommerce stores, distribution and storage centres, mobile apps and human resources.

The key activity of Walmart is to buy and deliver goods. The company controls the costs involved. In addition, it invests in inventory control, customer service and distribution management. The company comprises three major categories:

  • Retail
  • Wholesale

Further, these categories consist of many formats: Hypermarkets, Supercenters, Supermarkets, eCommerce, warehouse clubs and more.

Revenue Channels in Online Grocery Marketplace Business

Is online grocery business profitable? Commission on Each Transaction: Admin can charge a commission on every transaction from the seller.

Vendor Subscription: A vendor has to pay a fixed amount of money to the admin in order to list, access, and sell on a grocery eCommerce platform. A vendor can choose the required subscription plan from a number of available options and can also upgrade or downgrade the plan according to his or her requirements.

Commission on Delivery: On every transaction, the admin can charge a fixed delivery fee from both buyer and delivery boy.

Secondary Revenue Streams:

  • On-site promotion for merchants/grocery sellers
  • Hosting banners ads
  • Start a blog and publish sponsored content on it
  • Sell useful merchandise such as jars and reusable carry bags. (it will also help you in branding)
  • Seller user data to market research firms

Read also: Why is Online Business in the Philippines Good in a Pandemic?

Key Features for Online Grocery Marketplace

How to start a personal grocery shopper business? Visiting supermarkets to buy grocery and other related items would be more difficult for a person. If you have decided to provide an ease of shopping and want to open or have opened an online grocery supermarket store, you must have some of the features for your online store.

Moreover, you must adopt a business model to become successful in this industry that will provide your customers with the ease and convenience of shopping. So, here the key features for online grocery marketplace:

  • Cart sharing
  • Product return
  • Multiple payment options
  • Reviews and ratings
  • Referrals and rewards
  • Easy registration
  • Delivery scheduler
  • Quick reorder or repeat order
  • Monthly shopping list reminders
  • Membership

How to Start an Online Grocery Business in 2022?

Online grocery marketing strategy? To launch an online grocery business in 2022, two methods can be followed:

Build from Scratch

To build a grocery eCommerce marketplace from scratch you will need a dedicated development team of your own or will have to hire a leading website development company. Both the cases require hours for research, development, testing and deployment. The process adds up to the time, making it expensive.

Using Ready-made Grocery eCommerce Platforms

On the other hand, a ready-made grocery eCommerce platform is convenient and less expensive compared to the development from scratch. Ready made grocery eCommerce platforms come with pre-integrated features and APIs, there is a one-time payment, and the time required for setups is less.

Growcer is one such readymade grocery ecommerce platform that can launch your online grocery business in a short time frame.

It also offers exemplary features and functionalities and offers a lifetime licence. Equipped with ready made buyer and grocery delivery apps, Growcer is a perfect platform to launch a grocery business online without any hassle quickly.

Do You Want to Manage Multiple Marketplace Just by Single Person?

Of course you can! You can handle multiple stores from all marketplace just by single dashboard. Cut your Business’s cost, and Boost your Efficiency at the same time.


Grocery consumption is the basic human need, and people are increasingly relying on online shopping. So, the online grocery business idea fits perfectly in the current dynamics, despite the above mentioned challenges.

The important thing for entrepreneurs planning to enter this sector is to be aware of these challenges and know how to tackle them by leveraging the right technology, trends and tactics.

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