In this age of digital globalization, all spheres of life as we know it have changed. The COVID-19 pandemic forever altered our shopping attitudes. The rising demand for on-demand grocery has led to a drastic shift of market retailers and wholesalers from physical spaces to the digital web, where everything is just a click away. Apps like Big Basket are the future of grocery shopping, the next evolutionary step from conventional marketplaces.

If you want to launch an on-demand grocery app but don’t know how don’t fret. Here is all you need to know about developing a grocery app like BigBasket.

Understanding the BigBasket Grocery App

BigBasket is India’s biggest online grocery store and is responsible for pioneering, what many claims is the perfect business model for grocery shopping online. The company sells food products, like fruits, vegetables, beverages, and more than 10,000 other grocery items. Not to mention, they have more than 1,000 brands on their web and mobile shopfronts.

From the very start, they kept hitting the right chords, catering to customer preferences for a convenient and quick online grocery shopping experience. Their innovative app features enabled consumers to get their daily grocery items delivered to their doorsteps, without them having to make time from their hectic daily schedules.

Here are the top 5 features of the BigBasket App:

• Wide range of grocery products
• Smart basket features and easy checkouts
• Intuitive user interface
• Embedded secured payment gateways
• Immediate confirmation of receipts of orders

How does a grocery app work?

In order for your grocery delivery solution to work seamlessly and provide the best user experience, it must include the following apps:

1. Customer Ordering App
   Frontend app to be used by the users to order grocery items of their liking.

2. Delivery Agent App
   Backend delivery app for delivery agents to successfully pick up ordered items from grocery stores, warehouses, or dark stores, and deliver them to customers.

3. Admin dashboard and portal
   Admin portal to provide a bird’s eye view of the business operations to be used by vendors, grocery store merchants, or admins.

Is there a need for a similar online grocery app in your region?

The first step before you embark on app development, is identifying the need; who is it that you want to target or cater to with your grocery delivery app? People’s lives have gotten busy with shouldering the responsibility that comes with simultaneously playing several roles in life. Working men and women do not have the time to go grocery shopping after long shifts at the office and by the time they get free, the markets are closed.

Grocery delivery apps can help them navigate through their tough and erratic schedules. Not only do people want the flexibility to be able to order at short notice but also receive fresh products. This can be advanced further with the introduction of ‘Schedule Delivery’ whereby one can place their order in advance either by days, week(s), or even the next month.

To put things into perspective, the grocery business is a $1 trillion industry and Nielsen is forecasting that 70 percent of U.S. shoppers could be buying groceries online by as early as 2022.

What’s the rule of the digital jungle?

Quick. On-time. Hassle-free. People want quick turnarounds since they want to save time and money from the hassle of grocery shopping, bargaining, and the irregular pricing of commodities which varies from shop to shop. Grocery delivery apps remove the problems of traditional grocery shopping and provide timely delivery of a diverse range of products, which might not be available at the customer’s nearest store.

Other attractive benefits include:

• Multiple payment methods
• Real-time delivery tracking
• Digital Wallet
• Product categorization
• Cool UI/UX with easy navigation

Remember to do your market research

Now that you have a general idea of what value your grocery app will be providing to your potential customers, it is always good to conduct market research to ensure that your app stands out. Here are a few questions you, perhaps, need to consider before developing your perfect online grocery app:

1. Do similar grocery delivery apps already exist in the market?
   
2. Who are your competitors and what mistakes (if any) are they making? 
   
3. Does your app satisfy the customer’s needs?
   
4. What is the location of your target audience?
   
5. What features are going to make your app stand out?
   
6. Have you missed out on any features? Or are you including costly features that the customer will most likely not use?

Having good market research would enable you to choose the right business model complemented by the features that fit your business needs. If you are looking to cut time and effort on the research part, it’s best to conduct remote design sprints for the idea that makes it easier for you to choose the best type of online grocery app you want to build. Now, what could be your options when it comes to the types of online grocery apps?

Types of online grocery apps

Each type of grocery app comes with its own functions catering to unique sets of business needs and target audiences. The most common grocery apps can be categorized into 4 types mentioned below:

What is the best grocery business model for you?

Once you have identified your target market, you need to figure out what kind of online grocery business model you want. Each model has different functions and conducts business in different ways. This is a decision that only you can make based on the risks, returns, extent of control, and investment that best suits your needs. 

Warehouse model requires a larger space for stocking grocery essentials, moreover, warehouses are usually situated outside of the town. Storing perishable goods like grocery essentials can be challenging and costly. One of the main drawbacks of this model is that quick and flexible deliveries can be challenging to fulfill.

A recent model that grasps a lot of attention from grocery businesses is dark stores. Nearby smaller distribution centers have assigned staff to fulfill the delivery request and handover to the delivery agents, who can deliver the ordered essentials quickly and efficiently. This model enables businesses to offer same-day instant delivery of fresh grocery items while keeping operations streamlined.

Nonetheless, the most on-trend delivery model is the ship-from-the-store model, a convenient, cost-effective, and on-demand model. It enables businesses to onboard multiple grocery chains on their app, and the delivery agents, upon request of a customer, can deliver the product of their liking, from the stories they usually buy from, at their convenience. This model comes with lucrative benefits such as same-day delivery, customer engagement, warehousing grocery marts, and streamlined logistics.

Popular features to add to your grocery app

Same-day delivery service, real-time order tracking, and how quickly the feedback and requests are catered to, are all top features of popular on-demand grocery apps. Having convenient and time-saving features will help you retain customers and attract future ones.

1. User registration: User sign-up/sign-in, profile management, forgot password, verify email and phone number
2. Operational features: Product search, filter search, search suggestions, payment methods and gateways, coupons and discount codes, check out, wish list, shopping cart, counter for quantity
3. Customer data: Location of the customer, address search, pin address
4. Delivery notifications: Pick-up time slot, delivery agents’ tracking, delivery agents’ contact, express delivery, order cancellation
5. Ratings and reviews: Feedback of multiple-scale services, delivery agents’ ratings, support and help, product quality rating, review and feedback

The features you choose for your app can become your main USPs, providing you with an edge against the incumbent market competitors. If anyone of these is compromised, the very purpose of a grocery app will be defeated. 

The development of a grocery delivery app like BigBasket is not that simple hence in order to develop a highly scalable grocery delivery app, it is necessary to know the tech and the resources that go into its development.

Technologies required to build an app like BigBasket

For any grocery app to be a success, it requires solid front and back-end technologies for it to be effective and scalable. The following are software development requirements that may aid you in deciding which technologies best serve your business needs:

• App Platforms: iOS, Android, Web Apps
• Backend: Python, .Net, Java, Node.js
• Frontend: Angular, ReactJS
• 3rd Party Apps: Google Maps
• Push Notifications: APN, Twilio, Firebase
• SMS, Voice, and Phone Verification: Twilio, Nexmo, Sinch
• Cloud Environment: AWS
• Payments: Braintree and PayPal, E-Wallets, Stripe
• Real-Time Analytics: Spark Streaming, Apache Flink
• Mandrill: Relevant to emails
• Database: Cassandra, MongoDB
• Traffic Analytics: Flurry, Google Analytics

Having the tech part figured out for the app is essential to understand the development cost as well as the required tools to enhance the grocery app’s functionality. 

How much does it cost to make an app like BigBasket?

There is a multitude of factors involved which contribute to the final cost of the app. The cost of developing a grocery service app depends on what you want your app to be, hence you control the cost. You will have to decide the scale of your grocery app whether you want a website, an application, or both. Costing is also compounded by the time constraints of finalizing the details of the project, developing the app, and testing it, which is time-consuming, depending on the complexities of the app. The longer it takes to develop the app, the costlier it gets, whereas, chances of compromised quality also exist if you want the time reduced. Once the app is launched, there are maintenance and running costs. Thus, time, quality, and cost have to be weighed out. You need to find the right balance between the two.  

Another better way to get your grocery app developed with instant deployment, without having to pay for development is the SAAS approach. It involves using an off-the-shelf white label on-demand delivery solution, that would work on a pay-as-you-go model. These solutions require zero deployment costs, as software companies earn a fixed cut on every delivery. 

If you want your online grocery app to go live within 2 weeks, we can give you that with our top-of-the-line On-demand delivery management solutions.

What’s next?

Now what you have to do is conduct analysis and research of the opportunities and challenges that exist in this sector and find the right balanced solution between trends, business strategies, and technologies. All of this might be daunting initially, however, you only need to follow the guidelines provided and everything will automatically fall into place. It’s essential to not be intimidated by the adjustments you may have to make to your strategies and app because we do not live in a homogeneous world. As you may have heard, those who do not evolve, get left behind – so buckle up for an exciting journey.

If you are thinking of launching an on-demand delivery app, one of the most important questions you have must be how much would it cost? The truth is that there is no “one size fits all” budget when it comes to the app development cost. The cost to develop the app depends on a number of factors, all of which I will cover in this blog. The right amount of investment depends on the business demands, model, USPs, and ultimately, the complexity of the app.

Before we dive into the app development cost metrics, let’s take a moment to fully understand the on-demand delivery space – starting with defining what an on-demand delivery business is, its functions, applications and use cases, etc.

What is on-demand delivery?

Unlike the old times, where you had to step out to have the cuisine of your choice or buy a product, an on-demand delivery app brings your preferred items to your home. This model enables businesses to act as a mediator, connecting buyers with sellers. When a customer wants a product or service, he/she can find a related service provider, order what they need through the app, and pay for it instantly or at the time of the delivery. A small service fee is charged on every order made through the app by the service provider.

The on-demand delivery model was pioneered by Uber; ever since its inception the adoption of Uber-esque business model has been vastly taken up and experimented with across different industries. Uber successfully merged convenience with quality. The value proposition it offered was centered around accessibility, urging other businesses to hop on the on-demand delivery bandwagon. Soon, from food delivery and transportation to entertainment, the on-demand economy had its roots pierced into every sector one could imagine.

Why is on-demand delivery so popular?

As we become more accustomed to search engines spawning results within seconds, instant gratification is inevitable. We expect the same when it comes to products and services. 

That’s where on-demand delivery apps come in handy. Everything is just a click away! You get cab or beauty services right at your doorstep within minutes, that too with real-time tracking. Recently, on-demand delivery apps have become an essential part of our lives. 

How does an on-demand delivery app work?

The on-demand delivery app works as aggregators of products, services and entertainment options. You can select a service you want from the app, be it taxi, grocery, food or medicine; it serves you exactly what you desire. Once you have ordered the product or service, the provider will get it delivered to your doorstep. Upon receiving the order you either prepay through payment integrations such as Apple Pay, online banking, or cash. Moreover, you can provide instant feedback to the service right from the app.

Each of these functions is deployable as an added feature but comes with a cost. In the next section, I will be explaining the importance and cost of on-demand delivery app features set to help on-demand delivery businesses make informed decisions about the key features complementing their business model.

Key features of an on-demand delivery app

Once you finalize the idea for your delivery business, you are in a better position to set realistic KPIs for the development of the app. Ideally, you should monitor these three KPIs which are correlated to the development cost of the app.

1. User acquisition
2. User retention
3. Transportation and delivery cost

Moreover, from the point of view of businesses, developing an on-demand delivery app solution – which includes the customer app, the delivery agent app and the admin and operations portal – will be extremely fruitful. Improved employee satisfaction, business scalability, independent contractors working part-time and instant feedback from customers are just a few examples of the benefits achievable while others are listed in detail below.

The Customer App provides a wide array of features, including real-time tracking along with status updates, the ability for customers to connect with agents, multiple payment gateways, push notifications, ratings, and reviews, and promo codes. Customers usually deem the following as the most important:

• Mobile-first user experience
• Fast delivery of products or services
• Cheaper prices than traditional service providers or sellers
• Frictionless payments system
• Real-time tracking

The Delivery Agent pp benefits businesses through auto-delivery dispatch, route optimization, and navigation, service details, tracking each agents’ earnings, modifying order statuses, and managing cash flow and receipts.

The Admin and Ops Portal gives a holistic view of the business and allows companies to manage their agents by GPS tracking and performance appraisals via analytics ensuring efficient resource allocation.

Knowing the value addition each feature brings to the app, you will be in a better position to choose the ones that best fit your business model and budget.

Types of on-demand delivery apps

On-demand delivery apps can be categorised under three segments based on vendor – client relations: Customer to Customer (C2C), Business to Customer (B2C) and Business to Business (B2B).

As per the US Census Bureau, the benefits of an on-demand app have already started to reflect in the global spending pattern. The on-demand service and product economy are attracting more than 22.4 million consumers annually and $57.6 billion in spending with food, grocery, healthcare and logistics in a prime position to benefit the most.

Food and Grocery Delivery:

Food and grocery are the most in-demand sectors for on-demand delivery. As food cravings and hunger are human instincts, providing convenience and a wider product mix can help capture major market share and customer loyalty. It is no surprise that the On-demand delivery market is on course to grow at a CAGR of 27.9% and reach $16,605 million by 2023. 

The most prominent on-demand apps within this sector are InstaCart, Postmates, UberEats, GrubHub, and DoorDash.

Healthcare: 

The ease of on-demand appointments for doctors, lab tests, and prescription orders are gaining traction from on-demand healthcare apps. As we prepare ourselves for the new normal post-COVID-19, one thing is for certain that the surge in demand for telehealth is going to be massive. There are a plethora of business channels you can tap into with digital healthcare.

Transportation and Logistics:

This is the most controversial sector yet but increasingly popular. Contentious due to the difficulties and hardships faced by companies like UberRush and Shyp however quite famous due to the successes of apps like Uber and Careem. It provides an opportunity for incumbent businesses and start-ups to find reliable transportation providers and users through coupons for cheaper and convenient travel.

Having covered all the prerequisites involved in defining the development cost, you can now work towards creating one for yourself. It is time to focus on the real question “The cost of the on-demand delivery app”. 

The cost of building an on-demand delivery app

Now down to why you have read this far: how much does it cost? The development cost of an on-demand delivery app depends on multiple factors such as the features, the country of development, team size, deadlines, MVP features, and the chosen platform. To get a better idea, it is important to understand how companies assign a cost to app development. Let’s take a step back, and think from a developer’s perspective.

How do software companies calculate the cost?  

Amongst multiple approaches adopted by companies to calculate the cost, the most common one stands to be:

(Fixed hourly cost) * (Hourly effort that goes into the development of the app)

This approach is dependent upon multiple factors such as the country from which the app is being developed, the complexity of the app, features and the number of hours required by the development team. For instance, a company in the USA charges $X per hour, and others in Pakistan charge $Y.  A simple app with minimum features requires 340 hours of development, whereas a complex app requires around 1500 hours.  

Which takes us to the next point i.e. how do these app development companies define hourly rates? Let’s crack the hidden secrets.

Factors impacting the hourly rate

1. Location
   The development of the app is more expensive in the USA than in Pakistan depending on the quality and experience of the company.
   
2. Platforms
   Android or iOS, each platform requires different skills and development costs which can be further affected by the type of app – native app or hybrid app.
   
3. Features
   Complex apps require a versatile set of features as compared to simpler apps that could be developed with just a few features. For estimating the cost of the app, it is vital to know the exact features you want in your app – whether you want to add location-based services, integrate a payment gateway, incorporate streaming, support multiple languages, allow ads, enable live chat, etc
   
4. Integrations
   You need to define if the app requires integration with an ERP or CRM. If it does, then it will add to the development cost.
   
5. Design
   It is the most integral and expensive component of the development. User experience-driven apps definitely standout but they come with a price tag. The visual intricacy leads to more effort, both from the back-end and front-end, hence leading to the app being costly.
   
6. Team & experience
   The experience of the development team determines the quality of the app. The more experience the team has in developing great apps, the more they usually tend to charge.
   

Other factors affecting the cost

1. Maintenance cost
   Make sure you have a maintenance cost agreement post-release so that your on-demand delivery app is future proof against any new updates by the operating systems which could leave your app redundant if not handled properly.
   
2. Infrastructure cost
   This involves consideration towards the server selections, database selections, or major integrations with ERP or CRM all of these will add up to the cost of the app.

All these factors define the number of hours that go into the development of the app eventually impacting the cost. However, there are ways to bring this cost down.

The most effective ways to cut down cost

1. MVP (Minimum Viable Product)
   Start with a limited set of features by defining your core competencies and build on them. Apps like Amazon, Uber, and Roadies all started as MVP with a limited set of features and gradually augmented. 
   
2. SAAS Approach
   The SAAS subscription-based model is lucrative for businesses looking for instant deployment. In a SAAS environment, the service providers will host the app for you and run the maintenance and updates against a minimum set fee to avail of the service or product. These models enable businesses to use off-the-shelf white-labeled delivery management solutions that work on a pay as you go framework. These solutions require zero deployment cost of the delivery management app, as their monetization model works on charging a fixed percentage per delivery. Therefore, the cost of an on-demand delivery app is dependent on the monthly order quantum.

Summary

Here are some guidelines to give you that extra nudge to build a successful on-demand delivery app:

• Do your research
• Start local
• Market
• Prioritize customer loyalty
• Incentivize delivery agents
• Be careful what you wish for- stay realistic

If you’ve read so far, we can safely assume you agree that this is the year to launch an on-demand delivery startup. Using that business idea of yours, showcase your entrepreneurial skills, and kick start your on-demand delivery business today!