1. Startups

Titipku Enters the B2B Segment, Strengthens Strategy Towards Profitability

B2B operations are targeted to start in the first quarter of 2023, in the early stages it will supply to 27 markets

In the midst of ups and downs online grocery, Let me solidify the strategy "path to profitability" by expanding its business into the B2B segment. The expansion will begin in the fourth quarter of this year with a target to operate in stages by 2023.

Founded in 2017, Titipku is a graduate of Y Combinator batch S21. Titipku was founded by Ong Tek Tjan and Henri Suhardja with the main mission of digitizing traditional markets selling fresh food needs, such as vegetables, chicken, meat and fish.

Initially, Titipku was designed to digitize MSMEs with a national scale target. There were 1.000 MSME partners who were successfully cooperating at that time. However, his party admits that it is difficult to manage because its partners come from various categories. In the course of 2-3 years, Titipku began to change its business model to hyperlocal, focus on digitizing market traders.

Many small areas that have not been explored access. In fact, the existence of the market is located in a strategic location. From the data we obtained, in 2020 Let me record turnover 700%, as well as embracing more than 31.000 MSMEs and 7.000 explorers. Now Titipku, has worked with almost 10.000 traders in 150 markets.

Strengthen position

In a separate interview with DailySocial.id, Co-founder and CEO of Titipku Henri Suhardja believes that business online groceries still have great opportunities in Indonesia. There are many markets that can be worked on, not only to benefit the end consumer.

Based on data in "Online Grocery Report 2022"As published by Titipku, consumer behavior in shopping has been stably formed during the Covid-19 pandemic. In fact, Titipku noted an increase in transactions online groceries 4-5 times before the pandemic.

To drive efficiency and maintain growth in the B2C segment, Titipku carries out a number of strategies. For example, maximizing marketing channel and make application improvements to increase user convenience. This strategy is believed to encourage awareness on service effectiveness online grocery, especially for mothers.

Titipku also expands its market segment by the end of this year. Thanks to the profits that are claimed to have been obtained from the B2C segment, his party is determined to enter the B2B business. the model, Sales Titipku will sell product supplies to market traders, and orders will be delivered according to agreed delivery hours. Value proposition offered remains the same, namely the supply of fresh products at affordable prices. With this price and quality, traders can avoid potential fraud.

In the future, Titipku is committed to facilitating the provision of business capital, not only assisting in product supply. The goal is to build an ecosystem of MSMEs and market traders in Jabodetabek.

"From the start, we were committed to growing with market traders. We don't have warehouse for the product to be sold. If Titipku had it, this would undermine the role of the market and would be contrary to our vision and mission. My Titipku partner market is warehouse best to have. All products are taken directly from traders," he said.

On the other hand, My Titip also revealed his plan to do fundraising soon. However, Henri was reluctant to elaborate further.

Login to B2B

To be able to run a business online groceries on an ongoing basis, Henri considers it important to focus on the quality of products and services, as well as economic units. According to him, what is happening in the industry today, many are too fixated on promos, not these three things.

"We are focused on being sustainable business, make sure path to profitability. So, we started getting into B2B at the end of the year. Not this one pivot, but become B2B2C as a whole," he said on a separate occasion some time ago.

Presented by Henri at the event Give me 6th Anniversary, B2B operations will begin in the first quarter of 2023 by supplying 27 markets for the initial stage. His party will enter the central market to serve 60 secondary markets in the Jadetabek area in the second quarter.

Still in the same area, this number will be increased to 80 markets in the third quarter, and increased to 100 markets in the fourth quarter. Titipku will also expand to Bandung and Surabaya.

Founder Titipku Ong Tek Tjan added that his party did not rule out the possibility in the future to supply products from farmers. According to him, traditional markets are still perceived as marginalized, their position is considered inferior to modern markets. Traditional markets are also difficult to get quality supplies.

Titipku will increase its role by facilitating access to venture capital from financial institution partners. This step can help traders to manage the supply chain well.

He also said he was optimistic despite the current economic slowdown. "People will divert spending to basic needs so they will spend. When this happens, we want Titipku partners to be able to choose a supply of goods with quality goods so that they are not inferior to modern markets." he added.

turbulence online groceries

Business online grocery, including quick commerce, not only shaken on a global scale. A number of startups have closed their services because they are no longer able to become sustainable businesses, especially in the B2C segment.

More Coverage:

One of the biggest players, HappyFresh financial difficulties so that they had to rework their business strategy. Onion forced to close service online groceries and direct pivot menjadi marketplace for used electronic products. Meanwhile, the failure to find a suitable economic unit forced Bananas to do something similar and pivot to another business.

Even though, online groceries including one of the prima donna of digital services that pocketed extraordinary acceleration during the early period of the pandemic. However, this trend is predicted to slope down in line with the easing of social restrictions towards a post-pandemic transition. People have started to go out and shop directly at the store since the last year.

In addition, the B2C segment on online groceries It is also considered difficult to become a sustainable business considering that it requires large capital for logistics infrastructure and subsidies for discount promos.

In analysis DailySocial.id past, potential online groceries has not been maximized considering that its penetration is still rotating in big cities, such as Jabodetabek. Moreover, people are still used to shopping for their daily needs directly at physical stores. Based on the report "The Institute of Grocery Distribution (IGD) Asia" market value online groceries will grow 198% from $99 billion in 2019 to $295 billion in 2023.

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