While online shopping for clothes and gadgets has simplified our life, vegetable buying still remains a hassle that needs be done even after a long day of work. Metro Tarkari is trying to solve this problem by providing its customers the option to shop their vegetables online.
With the goal to eliminate the intermediaries by directly connecting farmers to their customers, Metro Tarkari is a hassle-free online portal providing vegetable deliveries free of cost.
In conversation with Anil Basnet, the founder and CEO of Metro Tarkari, read on to know more about this online vegetable delivery startup.
What inspired you to create an online platform like Metro Tarkari?
Being an IT graduate, I formed a team with my college friends, Humbal Shahi, Ishwor Acharya, and Nitin Sharma, to establish an IT company named Metro-Vibes Private Limited in February 2012. We worked on outsourcing and developing software’s, websites and mobile apps. Since the e-commerce business was booming, we wanted to develop an e-commerce business that hadn’t been tapped yet. I remember those days my mother would ask me to get vegetables on my way back home. I would work till wee hours and by the time I left for home, most vegetable vendors would have left for theirs. This caused a lot of inconvenience for both my mother as well as me. Then it occurred to me that while online shopping has picked up there aren’t any platforms for vegetable shopping for working people like me. We dived into research and conducted a survey for three months on the vegetable market. Finally, we came up with an idea of developing an e-commerce site to enable people to order vegetables online and get it delivered at their doorstep. Metro Tarkari was launched in December 2012.
How has been the journey with Metro Tarkari?
When I started in 2012, I had no experience of either agriculture or marketing since I was from the technology field. At the initial phase of setting up the business, we were a small team and we’re focused on acquiring customers and developing the market. We would deliver the vegetables ourselves to the customers from the wholesale market because we didn’t want to reach out to farmers without having a pool of buyers. We delivered more than 3,000 packets of vegetables in the first three years. After gaining experience, we developed a good understanding of the variety and quality of vegetables demanded by the consumers. We have also a network of farmers who can cater to the quality needs of our online consumers. Our team has also grown with 21 employees in different departments including admin, logistic, marketing, finance, and management. We have created the infrastructure for vegetable delivery including a delivery van and five delivery bikes.
How easy or difficult was it to onboard farmers to supply the vegetables to Metro Tarkari?
It was very tough to get the traditional farmers onboard as they were not able to understand our business. However, we have seen a lot of young people entering agriculture sector including MBA graduates. They understand the online business model when approached and were ready to supply.
What positive impact do you see Metro Tarkari having on agriculture sector?
One of the key challenges for the agriculture sector is the middlemen who pay advances to the farmer and buy the produce at low prices before a harvest. For example, the trader would buy tomatoes for Rs 5/- per kg and sell it for 30/- making huge profit margins. Farmers are happy to receive the advances but are disappointed when they learn about the market prices. We want to eliminate these traders who add humongous margins on the prices and transfer these profits to the farmers. With us, the farmers set their own prices, and then provide vegetables directly to the consumers.
Vegetables have a short shelf-life, how do you keep the wastage in check?
We have a very strong B2B client portfolio. Our clientele includes college canteens, hospitals, corporate offices, etc who order bulk quantities from us. This gives us a good estimate of the required inventory. We try and source our vegetables from farmers near the Kathmandu valley. We also have a small cold storage space with 2 days of storage capacity. By now we have a good estimate of our retail sale. Currently, our service is confined to Kathmandu Valley and Chitwan. We deliver 20- 30 orders per day, with Rs 3,000 to Rs 4,000 per customer. The customers usually purchase 1-week stock and then we have our loyal customers who order on monthly basis. All the staffs from Metro Tarkari purchase the vegetables. If the vegetables are not sold out on the same day, we sell it within two days and dump the leftovers.
What are the kinds of challenges you have faced while setting up your company?
Our biggest challenge was to get the initial capital to start the company. My parents did not understand why I would want to deliver vegetables after becoming a computer engineer. I borrowed the money from friends and purchased my initial stock of products. However, now the challenge was managing the logistics of delivery. When we started out we delivered the orders ourselves using bikes. However, when we hired delivery staff and wanted to provide one-hour delivery service they were not able to do it as either they couldn’t find the house or there was too much traffic.
What kind of opportunity do you see in the organic product market?
The products available in Nepal are not certified organic. We are working with a small section of farmers who use low pesticides compared to their peers. But they too have their reservation as the cost of organic produce is very high and competition is tough because of imports from India and China.
Nevertheless, we do see a peak in consumers interested in buying organic vegetables. We have a contract with Asha Free Farming to sell their product through Metro Tarkari and some NGOs and INGOs have also approached us for promoting their organic vegetables.
How did you raise fund for business expansion?
We invested all the profits we made back in the business. Our major expenses were adding delivery resources like the van and bikes. We also upgraded the software. I had pitched Metro Tarkari to more than 30 investors but couldn’t secure any investment. Later I turned to crowdfund and raised the capital for expansion from Nepalese who are living abroad. Since we had an innovative idea and received national media coverage we could finally raise 3 million Nepali rupees. A lot of our B2C customers are from abroad who order the goods online and get it delivered to their family staying in Nepal.
How do you manage online payments?
We have registered our company in Australia as metrotarkari.com. The team living in Australia handles online transactions. In Nepal, we accept cash on delivery and card on delivery. They can also pay through Khalti, e-sewa and direct transfer to our bank account.
What about new competitors? How would you keep up with them?
Unlike our competitors, we are focused on selling vegetables and locally grown products rather than household groceries. We are cross-selling groceries to retain customers. We actually welcome competitors as they will contribute to building the market. With competition, there would be more opportunities. Having said that, selling vegetables is a difficult business because the items are perishable and the stock cannot be retained for more than a couple of days.
What are your expansion plans?
We have more than 20 thousand customers registered on our website. So, we are planning to outsource the product directly from the farmers. This can assure the best quality and price of the product.