Why Dunzo Failed: A Case Study of a Hyperlocal Delivery Startup
Dunzo is an Indian company that offers on-demand delivery services for various products, such as groceries, medicines, food, pet supplies, and more. Dunzo was founded in 2015 by Kabeer Biswas, Ankur Aggarwal, Dalvir Suri, and Mukund Jha, and it operates in several cities across India, including Bangalore, Pune, Delhi, Hyderabad, Chennai, and Mumbai.
Dunzo’s value proposition is to provide…
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How Dunzo Works The Hyperlocal Delivery Business Model
Dunzo is a web consumer-offerings app, and may be correctly defined as a “multi-offerings app” or maybe an “exceptional app”. Such a multi-carrier app gives more than one offering inside one platform.
Dunzo’s app and internet site offer on-call concierge offerings for its customers withinside the hyper-nearby market. It makes use of a data-pushed platform and connects with the closest transport man or woman, in which the transport member’s activity (area and movement) is tracked thru the app throughout his complete journey.
Dunzo turned into the primary Indian startup to obtain direct investment from Google and has raised numerous rounds of investment thereafter, amounting to a complete of $seven-hundred MN.
What is a “multi-carrier” app?
Also referred to as an “exceptional app,” a multi-offerings app is software that gives numerous offerings inside one app. Some famous examples encompass Dunzo, Grab, and Gojeck.
The concept at the back of such multi-carrier apps is geared toward broadening the variety of offerings offered, consequently growing its probabilities of attaining profitability. Offering more than one offering that their customers will want to apply to numerous factors of their day-by-day ordinary offers the app the possibility to generate extra sales, goal a much wider phase of the audience, and as a result, enhance its profitability.
As a case in point, allow us to study how Dunzo works, its sales version, and its enterprise version.
What is Dunzo?
Dunzo is a hyper-nearby and on-call app.
For a small transport quantity, Dunzo will supply quite lots of something for you. For example, groceries from the market, a parcel from one area to every other, a couple of latest footwear out of your preferred e-trade store… the listing is endless! Dunzo is a multi-transport carrier and could supply all this to its clients. Given beneath neath are a few key employer highlights:
App: Dunzo
Founders: Kabeer Biswas, Ankur Agarwal, Mukund Jha, and Dalvir Suri
Founded: July 2014
Category: Online Consumer Services
HQ: Bengaluru, India
Parent Co: Dunzo Digital Private Limited
Downloads: 5,000,000+
Valuation: $245 million
As is the case with third party-aggregators, Dunzo doesn’t personalize any of those shops, restaurants, or retail/online shops, however, follows an enterprise version this is centered on transport.
Dunzo: investment history.
Starting from its first spherical in November 2016, while it raised $1.18 million from Aspada Investments, Dunzo has raised a complete of $seven-hundred.1MN in investment over 18 rounds. Their ultimate spherical turned into on January 6, 2022.
Dunzo: enterprise-version
The Dunzo app offers an on-call for transport carriers in main Indian towns along with Mumbai, Delhi, Noida, Chennai, Bengaluru, Hyderabad, and Pune.
It has tied up with an entire slew of restaurants, shops (e.g., apparel, fashionable merchandise), and shops. Its electricity originates from the ease that it offers to its customers i.e. while a consumer wishes to shop for something, or sends over a parcel to every other man or woman who can not — or doesn’t need to — make the bodily journey, Dunzo is in play.
Dunzo customers can order something of their choice, from something that is to be had from the listing of shops on the app. The listing of merchandise to be had at the Dunzo app is unfold throughout food, groceries, medicine, cigarettes, and clothes — to call only a few.
As referred to earlier, the Dunzo app also can be used as a “private courier carrier” i.e. to you need to ship a parcel — let’s say a birthday present to your buddy in every other part of the city — you may ship it thru Dunzo transport.
Dunzo: sales-version
Let us study how Dunzo generates its sales.
1. Delivery rate: Dunzo costs a transport rate for every transport it makes. The quantity varies among Rs. 10–60 primarily based totally on the gap this is to be included and the order value.
2. Commission: Dunzo costs a fee from its vendors. This charge varies from 15–30%.
3. Services to be had: Home and restore offerings (etc.)
4. Surge pricing: Surge pricing is every other supply of generating /growing sales.
5. Others: In addition to the offerings referred to above, there may be additionally a category — called “#kuchbhi”! — that covers miscellaneous requests. Some examples are:
Take an image of the brand new construction beneath neath production at the subsequent address
Bring my pc from home
Apps like Dunzo — i.e., hyperlocal transport models — have received a reputation in the latest years, and now is a great time to recollect launching one.
Dunzo: workflow
Install the App.
The consumer could make a reserving for a package deal to be sent/picked up from one area to every other inside a city.
Dunzo’s group will choose up and supply to and from the addresses referred to — typically, inside some hours.
The consumer will pay Dunzo a transport rate.
FAQs
What are a few different apps which can be like Dunzo?
Numerous examples exist. Grab, Gojek, and Postmates are a few famous ones.
How lots wouldn’t it price to set up/create an app just like Dunzo?
While the very last finances might rely upon the range of features, and the scope of its functionality (etc.), an app just like Dunzo might price from USD 25,000 — USD 50,000.
Multi transport apps: what are the demanding situations they come upon?
As you’ll have likely guessed via way of means of now, an enterprise version like Dunzo’s — even with several advantages — is likewise an operationally in-depth one. It additionally creates stress on coins glide and to be-had sources and operates beneath neath tight margins, constraints, and timelines.
On the facet of call for and purchaser expectations, the project is the regular warfare to now no longer best onboard new customers but additionally, keep them.
Since apps like Dunzo are best imparting the “carrier”, i.e., transport, in this case, they come upon regular troubles like product unavailability, and logistics troubles (e.g., traffic, weather). Such troubles should cause purchaser dissatisfaction and, upon repeated occurrence, will in the long run cause lack of purchaser confidence, consumer attrition, and churn.
Conclusion: As is evident, launching and correctly working a multi-transport offerings app like Dunzo might require successful leadership, sturdy integration of the stock system; an optimized transport network, and the net product listings to be up to date in real-time so that clients aren’t misinformed or confused; and strategic pricing policies.
The use of cutting-edge equipment and technology like the last mile delivery software program has additionally ended up invaluable, because, without it, you can not wish to reap fulfillment and profitability in today’s tech and data-pushed eco-systems.
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