This Hyderabad startup bridging gap between local stores and busy customers

To counter wastage of perishables at dark stores, carbon footprint generated by riders of quick commerce delivery players, support existing offline local retail stores and service providers, micro hyperlocal is the way forward. Hyderabad-based Community Concierge Sarrthy, coined as a personal runner team or assistant for daily errands witnessed Rs 1crore worth GMV (Gross Merchandise Value) in FY23. Speaking to Bizz Buzz, Chetana Bhattacharya, Founder of Pahoyti Systems Pvt Ltd, sheds light on the unsustainable practices, dark stores and highlights the importance of supporting offline local businesses

Amid rising demand for Quick commerce, how does Sarrthy stand apart?

People usually order items in bulk to avoid delivery charges. As those items might not be of immediate use some might end up in the bin as spoilt. Sometimes fruits and vegetables ordered online do not turn out to be of good quality and has to be returned. But when we order vegetables or fruit, it means the requirement is for that day. This is how Sarrthy, a solution to get things from neighbourhood at a reasonable time and cost, was conceptualised to address a gap. We run errands for families of gated communities such as buying things from departmental store, book store, gift shop, collecting diagnostic report, courier or speed post, stamp paper, rental agreement or notarization, pay utility bills, print out or Xerox, buy medicines, certain bank work, getting a plant from nursery, shoe repair or polish. Besides senior citizens, families with small children at home, school going kids, work from home professionals or those working till late hours use ourservice extensively.

Run us through the process, from placing an order till its delivery…

When a customer gets onboarded we create a dedicated WhatsApp group for the family members. From our end, a team of two people are added. Whenever an order is raised it goes to the backend, the order gets generated and our team makes sure that the list is attended to. Any back and forth or clarification on an order is cleared before delivering the order. We do deliveries in eight cycles each day. After an order is placed, it will be delivered in 90 minutes. How is Sarrthy addressing unsustainable practices of quick commerce delivery players? Our motto is sustainability while providing convenience. Any order received in 10 minutes results in carbon footprint. As it’s a one-to-one order, high carbon footprint is generated by fuel consumption, whereas we batch the orders. Within 90 minutes the number of orders we receive are picked, kept together and dispatched. We have one milk-run guy who picks all these from different stores and brings it to the apartment. As we have batched the process, one person can handle 10 to 12 orders in every run. Every other player is building on providing comfort to the customer. Have we really thought about what we are doing to the environment? It does not matter how much petrol is being consumed, at what speed the rider travels, how much wastage is taking place at the dark stores. Sarrthy uses e-bikes to reduce carbon footprint, we do batched delivery for lesser usage of power for charging these batteries. Most of our deliveries happen from the stores inside the gated community, with no fuel consumption. Even if online giants convert their entire fleet into EV they will still be consuming 40 per cent more power than us because we deliver in batches. Also we reuse cloth bags we do not print paper bags. There is no extra generation of waste which needs to be cleared later.

How many customers has Sarrthy served from 2022?

We take up service in one society only after onboarding five families. Right now we have paid members in 4 societies in Nallagandla, but we deliver orders in the entire neighborhood. Our target communities are those with more than 100 flats. Hence the odds of getting more order from each society in the high density pockets are higher. To optimize operations, we have taken up such gated communities. Active users are 100 families. Sarrthy has served over 600 customers directly or indirectly. We have run over 2 lakh errands since inception. We have B2B orders as well wherein we cater to delivery orders of stores too. Say a vegetable store here wants something delivered directly to their customer but wants our logistic service. We step in there as we get regular orders there too.

How cost-effective is your service?

We have a monthly membership fee for which orders can be placed multiple times. And they do not have to pay for each delivery separately. So the customer does not have to worry about paying delivery fee even if it is for one item. Our monthly subscription fee is Rs 799, and Rs 599 for 15 days.

What would be the reason behind drop in membership numbers?

There are not many local Hyderabadis here. Most of them are from other places due to which we see frequent relocation to some other place which we do not service, or moving to a new city or country altogether.

Amid competition from other online players, is Community Concierge a sustainable business model?

Because the service is personalised we see an increase in demand. It has been more than two years that we started off and our initial customers are yet utilising Sarrthy’s services. There is convenience of placing order, ease of not browsing through the whole list that appears on these online platforms. If something is not available at one store then our delivery boys at multiple stores will immediately inform where that product is available. Next is the quality; stores have an obligation to clear out what is spoiling first. We pick just like the customer would have at a store personally. The whole idea is to be there as a runner team available at their disposal, to run errands for them. Our customer base is the ones that like offline shopping but do not have the time or mobility for it. It is a niche and personalised type of service. In India online retail penetration is only about 12 per cent, rest of the 88 per cent still goes to offline stores. So we have huge scope. And we not only deliver goods, we also run errands for our members, which are otherwise time consuming. The holistic approach of providing these services under one umbrella makes it more sustainable.

Any plans of scaling up the platform?

Scaling up plans, we have... With our limited funds, we are working on a solution wherein a single WhatsApp number will be given for placing all orders which will be taken care of automatically. Apart from this we are also launching a portal where customers can log into the website and place their orders. The portal can be accessed through mobile itself, hence it does not need to be downloaded like other apps. People can log in with their phone numbers, place their order, track it, make payments and so on. We have outsourced the technology development to a trusted vendor. Eventually, we would have a tech-team of our own in place. We will be shortly launching a service for D2C brands too. Being able to build the right tech solution is the way to scale.

What about expansion plans beyond markets of Nallagandla?

Recently we branched out to Kukatpally. We have tied up with stores present at two gated communities there. Expansion needs additional funds. We are pitching our plan to investors. We also plan on partnering with Residential Welfare Associations. Our pitch to investors echoes the difference between Sarrthy and other online players… we do not have any inventory of our own. We are asset less. Our asset is deep understanding of customer needs and operations capability. All services provided by local stores present in the neighbourhood, grocery, vegetable, repair or hardware shop, street side cobbler etc, are mapped in our network. Our inventory is the neighborhood’s inventory. Brick and motor stores are facing huge competition from online players and these offline stores are way behind in the online game. Offline stores have good products offered at discounted prices but, as people have stopped going to such stores, they are not aware about their presence. Retail stores within the society are the most affected. We are bridging the gap between neighborhood stores and the residences nearby. Managing all of this efficiently with the use of technology is what we do. We have plan to expand to other tier 1 and tier 2 cities.

What is the funding amount you are expecting to raise?

In the past two years we have invested Rs 30 lakh which is completely bootstrapped. We hope to raise funds to build tech and expand. We are moving slow because we are waiting for investments. Through We Hub we have applied for few grants, we are looking for angel investors too. We are expecting around Rs 2 crore to start with which will help us scale over the next 18 months. Along with strengthening our technology platform we will invest a part into marketing. This is only a volume game as more the number of members we will be able to get the revenue go up. We also have additional revenue channels which are in the form of commission from vendor partners, and when our GMV goes up a percentage of it starts getting added to our revenue. Apart from these, going ahead we will also have advertisements as another source of revenue.

As manpower is one of your assets, what is the number you are looking to hire?

Right now, we have nine people working for us including backend staff. As our service area is limited, and we use batching, the same manpower serve the locality, in the given time frame. We have separate manpower for the other services I mentioned like the banking service. If the funding goes through, we would hire about 70-100 people over the next 18 months, including managers, supervisors, back-end staff, admin, and other functions.