MaxWholesale, a mobile based B2B grocery supply chain platform owned and operated by 99 Algorithms Pvt Ltd on Monday raised close to $1 million (Rs 6 crore) in pre-Series A funding led by Indian Angel Network (IAN) and Maple Capital Advisors. Prominent IAN investors include Ambarish Raghuvanshi, Raman Roy, Sunil Munjal, and Bikky Khosla amongst many others. Pankaj Karna and Abhinav Grover of Maple Capital Advisors also participated in the round further endorsing MaxWholesale’s potential.
The company will use the fresh funding to fuel growth and tech innovation. MaxWholesale has developed a self-operated e-commerce platform to connect FMCG companies directly with small kirana stores disrupting the traditional supply chain. FMCG retail in India is highly fragmented with 92% of it being deemed as ‘unorganized sector’ being run by family owned mom and pop stores. There are more than 7 million neighbourhood convenience stores in India, also known as Kirana stores. These stores carry thousands of SKUs and have to deal with hundreds of suppliers on a weekly basis for replenishment. MaxWholesale’s eWholesaler model provides superior performance across all metrics that matter to these retailers like better assortment, convenience, pricing and fulfilment services.
Lead IAN investor, Ambarish Raghuvanshi, who joins the Board of Maxwholesale commented , “MaxWholesale has a perfect combination of a winning team with a balanced knowledge of domain, distribution and technology. At times, solving a simple problem is the hardest. This is what I see in Max Wholesale. The platform is very beautifully designed to strengthen and entrench the existing retail network of retailers rather than disrupting it. It will offer the end consumer with wider selection of products at more competitive price points making it a win-win situation for brands as well as retailers. I am very excited to be part of this journey with the team”
Founded in May 2016 by Samarth Agrawal and Rohit Narang, the app is available on PlayStore for Android and the AppStore for iOS users. Samarth, an alumnus of IIT Delhi specializes in building mathematical algorithms and tech products, while Rohit comes from a traditional brick-and-mortar retailing background with 16 years of experience running his family owned retail stores in Delhi’s Hauz Khas area. An ideal complementary team of technology and domain expertise with a common objective to transform the distribution eco-system by providing a superior service to stores versus the old supply chain using the scale of Wholesale and the efficiencies of scalable digital platforms.
Samarth Agrawal said “Its just been a year and we have received a phenomenal response from our retailers as well as the FMCG companies, we are seeing an organic growth of 40% MoM. Our retailers love our product and we have a very high repeat order rate. The funding by IAN and Maple Capital will help us further strengthen our foothold amongst retailers. We have strong reasons to believe this conversion to eWholesaler model is inevitable.”
MaxWholesale is currently working with more than 1000 retailers in Delhi. With this round of fund infusion, the company plans to scale operations and cater to more than 10,000 retailers over the next few quarters.
“We backed the Max founders when it was an idea less than 12 months ago, they have done a commendable job of walking their talk, growing the business by 10x in a very short span of time along with positive unit economics. Investment by IAN, very pedigreed investors now is further testimony to this. The sector holds tremendous potential in India and Max is uniquely positioned to empower the Kirana Store & beyond in India” said Pankaj Karna, Managing Director of Maple Capital Advisors, who re-invested in this round as well.
Raman Roy, co-founder and board member of IAN and lead Investor in MaxWholesale said, “There is tremendous opportunity for the company like MaxWholesale, currently there are more than 7 million stores in India and Packaged consumer goods market of India is more than $40 Billion. MaxWholesale is leveraging the power of technology with state of the art logistics management to leverage this opportunity. They have shown phenomenal growth in a short span of one year, clearly bringing out what the possibilities are. I am excited about the company and its potential to become the market leader of FMCG wholesale. I strongly believe in the vision of the founders Samarth and Rohit.”
With the use of GPS based routing algorithms MaxWholesale is able to create dynamic replenishment routes every day. It helps dramatically reduce time to delivery from the current one to two weeks to less than 24 hours, enabling quick refill of SKUs for retailers and reduce inventory cost. It’s automation engine also captures and processes complete trade data at each level. This improves product availability and cost effectiveness of the supply chain. MaxWholesale is currently powering online wholesale for more than 90 FMCG Companies, like Cadbury, Dabur, Patanjali, Capital Foods, P&G, HUL to name a few.
Currently wholesale accounts for 50% of the packaged good supply to kirana stores as distributors struggle to service the fragmented market. With the changing dynamics in the post GST environment it organized players are set to reap advantage. With the government’s push for organizing the segment eWholesale is for sure the next big thing.