Rozana is a peer-to-peer rural commerce startup that aims to connect the rural population of the country to online rural commerce through a network of micro entrepreneurs. Rozana uses technology and data science to meet the unique local needs of 1 billion Indians that are not met by any online commerce. This population of 1 billion Indians rely on unorganized retail kiranas unlike urban India which had access to organized retail stores even before e-commerce came into the country.
Given the unique P2P commerce model, the peers at Rozana.in play 3 critical roles:
● Onboarding Consumers: The first is to onboard new consumers by spreading awareness and training villagers about the Rozana app and website. We directly procure products from the brands, thus eliminating the intermediaries and delivering it to the village.
● In-Village deliveries: The second business function includes delivering the products within the village. The Peer Partner delivers the products within the village to his/her consumers. This helps Rozana save last mile cost. Since the peers live within a close distance to the customers, we either make deliveries to the customers’ doorstep or act as pick-up points for customers.
● Forwarding Promotional Deals: The partner looks at forwarding all relevant deals and discounts to shoppers via popular social media channels like SMS and WhatsApp to the village. This helps Rozana run promotional campaigns for new products and brands. The entrepreneurs become our enablers, and we create a tech enabled ecosystem for them to order and supply products within their village.
What are the unique key points (USP) of your company? How is Rozana different from other players in the market?
One of India’s first rural commerce platforms. India has scores of e-commerce sites which have brought consumer revolution in urban India with focus on metro cities. The platforms are focused on urban India, while Rozana is focused on 6 lac villages of India. Over 1 billion Indians, living in rural India remain severely underserved by organized retail.
Legacy brands and larger e-commerce companies find it tough to set up an efficient supply chain in remote villages, or even generate demand in areas, while Rozana has an unconventional approach of working in predominantly rural and semi rural areas, which remains largely untapped.
The unique village by village strategy of our platform is driving product innovation, demand and supply optimization for a new era of D2C brands for over 1 billion Indians. Our ‘peer’ powered platform has been modeled on social commerce, leverages AI for enhanced capabilities and caters to rural users.
What are the traction details (achievements of the company)?
Since its inception, Rozana has reached more than 4 Lakh households within a span of 9 months. In the last round of investment, we raised $2.5mn in pre-Series A led by Europe’s IEG-Investment Banking Group & 3one4 Capital. With prominent angel investors like SK Jain, Co-founder and MD or Sequoia and Westbridge Capital.
Today, Rozana serves 4-5K gram panchayats in rural UP, Haryana and others. We are aggressively working on a roadmap at targeting 300mn customers in the next 2 to 3 years. Furthermore, we have crossed INR 270cr ARR threshold and are growing faster than expected.
How do you look at expansion?
We are aggressively working on a roadmap at onboarding 300 Mn customers in the next two to three years and for this we will be utilizing our latest round of funding.
Owing to the overwhelming response, we are now eyeing every gram panchayat. For this, we have already initiated our operations beyond North India, beginning with Karnataka. We aim to diversify our product portfolio to cater to the growing aspirations of rural India, create more women entrepreneurs and in turn livelihoods through our P2P commerce platform.
What are your future plans, with respect to the Indian Market?
Rozana’s mission is to be the ‘Go-To’ platform for 10% of the world’s population. We plan to expand and deepen our presence Pan India to serve 1 billion plus Indians residing in the rural areas who remain under-served and rely almost on unorganized stores who are incapable of catering to the demand.
What are the challenges for Rozana to maintain a steady cash flow?
Rozana does not face any challenge for cash flows in terms of sustaining the business. Rozana is on track to build an extremely efficient business model with a clear road to profitability. The company is acquiring clients at an extremely fast pace and adding higher margin products considering our profitability in mind.
What is the monetization model?
Rozana directly procures products from the brands, thus eliminating the intermediaries and delivering it to the peers. This allows us to operate an asset-light model by keeping minimal inventory at hand and passing on maximum margins to our exclusive agents. This is a win-win for all as producers get better gate prices and peers earn a 4-8% commission on each delivery. We earn a margin on every financial transaction that takes place on our platform.
Some of the key monetization pointers are:
● Wider product portfolio to increase margins
● Whitelabel and D2C brands to capture the imagination of aspiring rural consumers
● Using data and consumer insights launching innovative products for rural India
● Use consumer insights work with brands on getting marketing budgets for rural India
● Use new age innovations like evs in the future for reducing logistics cost.
What challenges are you facing in running your business?
One significant aspect of operating in rural India is trust and strong networking. Businesses in the rural market thrive on trust and relationships, and thus a strong network results in a deeper probing in the hinterland. Secondly, factors like supply chain, training staff, infrastructure, online payment can have an impact on rural businesses like ours.
What has been the biggest learning so far?
Rural India has bust many myths about our understanding of the villages. Some of them are as below:
● Villages are self-sufficient: This is untrue and almost all their procurement takes place from the cities. Even a part of the vegetables are also bought from the market. Thus it is important to note that every villager is now aspirational and a consumer revolution is on the verge in rural India.
● Rural Consumers do not have disposable income: Over 250 billion dollars have been transferred to rural households in the last 5 years through Direct Cash Transfer schemes. Schemes like MNREGA, NRLM and other such schemes along with more rural Indian families sending mail members to work in urban India, has given rural households disposable income.
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