Challenges and Their Potential Solutions of Online Grocery Business

The online grocery businesses have surged significantly in the last few years, increasing profits at an exhilarating speed. There are now more online users than ever; as smartphone users keep rising, the business will keep on adding new consumers.

The online grocery business is also witnessing a sharp rise in order volume due to the pandemic. The phrase “Stay home and stay safe” has led people to stay inside, boosting the number of online orders for groceries significantly.

The heavy traffic of users and order volume sometimes create challenging situations for business owners and entrepreneurs. 

Nonetheless, these challenges are necessary to survive the high volatility of the grocery delivery business. And it prepares the respective owners to tackle future endeavors. 

But still, these are not the only challenges faced by online grocery businesses; there are some situations and complexities that need to be met and resolved instantly for the next turnaround.

Before we leap on to the challenges and potential solutions for the online grocery business, let’s understand more about it.

Which factors are influencing the online grocery business?

When it comes to the online grocery business, we can thank digitality and innovation. The rising number of smartphones in local households contributes to the massive success of the online grocery business.

Grocery Delivery App Development service providers have introduced many viable benefits of online grocery delivery, from cost-efficiency to ease of use.

  The pandemic also helped the business surge drastically by people in lockdown, unable to go out and shop, relied on online grocery apps to satisfy their hunger.

The deals and discounts also contributed to the fantastic success of the online grocery industry. People are now able to buy groceries from a retail shop at a discounted price. Various attractive deals also help them create a friendly budget for buying groceries online.

The market trends of the online grocery business

The online grocery business is slowly becoming one of the most advertised industries globally, using both traditional and modern advertising methods to gain user trust and create a digital identity of itself. 

Let’s get a quick look at all the available market trends and statistics:

  1. The business revenue is expected to increase from $1 billion to $3-$5 billion in the next five years.
  2. A massive number of Americans, almost 90% of them, use online grocery business.
  3. There has been an increase of 50% business in the online grocery industry since 2018.
  4. The online grocery apps have witnessed 106 million downloads.
  5. By 2022, the number of adult users is estimated to increase by 30 million.
  6. The US online grocery sales had grown $30 billion in 2021 from $18 billion in 2018.

What are the Online Grocery Business challenges and possible solutions?

Every business in modern times goes through some ups and downs. There are always some circumstances that business owners have to deal with to create an enduring company generally.

The challenges are also necessary for helping you find all the pain points of your business. It helps you in learning and recognizing all the issues that can lead to massive losses.

And once you learn to tackle issues regarding your online grocery business, the experience stays on to help you in resolving further endeavors. 

Let’s get a brief look at the mostly faced challenges by the online grocery business and their potential solutions to help you keep going:

Challenge 1: Inefficient storage and delivery system

The online grocery business is entirely dependent on the quality of the grocery being delivered. Longer storage time ruins the quality of the perishable items. Special storage facilities, containers, and customized delivery vans are adequate to handle all the tasks but require considerable capital. The delivery system is commonalty broken when it comes to offering same-day delivery of grocery items.

Solution 1: 

A fully upgraded intelligent supply system with the latest state-of-the-art grocery management facilities can help significantly turn down all your storage complexities. Coming to delivery, you need a flexible, efficient, and competent delivery service provider to ensure timely order completion for economic and operational perspectives. You will also require integrating and managing high-end inventory APIs for a smooth and successive transition of grocery items from warehouses to the user’s doorstep.

Challenge 2: Low profitability and rising costs

It is one of the biggest financial nightmares for a business owner to endure. Many online grocery businesses offer great deals and discounts on grocery items, which leads to customer satisfaction, but directly affects the business operations and is solely borne by the owner. Then there are perishable items like dairy, vegetables, fruits, meat, etc., that require adaptable storing facilities to keep them from rotting. All these problems require a great deal of inventory management practices, leading up to rising costs.

Solutions 2:

The primary objective for the entrepreneur should be to overcome these issues. And for that, they can create a grocery delivery app with as few perishable items as possible. It helps get rid of all the extra cost wasted on throwing out rotting food items. Secondly, They can rent special warehouses to store all the perishable items and will help save costs significantly.

Challenge 3: Volatile consumer habits

Consumer habits are still a large part of our daily lives. We are hot-wired to choose our food, picking it up in hands to ensure quality and texture. All these habits are necessary and crucial when it comes to buying food. But we can’t do that in the online grocery business; we can’t tell the quality of the items just by looking at them. All this results in dropped user satisfaction and leads to lower sales.

Solution 3: 

Many different approaches can help business owners retain customers and attract more business. A few of them are: Customer goes to an offline store, chooses the desired items by hands, and places the order. The order then gets delivered to their house. Or Self-checkout using technologies like iBeacon to avoid long queues of customers. These steps can help business owners create an Eco-system of trust and loyalty between the business and users.