When Abhinav Pathak was in the United States working for Goldman Sachs as an analyst, he was able to experience the Black Friday sale firsthand. The chaos inside stores and at cashier counters didn’t sit with him well. He decided that it was the worst possible retail experience. Pathak wished there was some way for the serpentine queues to be done away with.
After returning to India in 2016 and seeing the same situation—people standing in long lines at the checkout counter, only at a larger scale and on a daily basis—Pathak realized there could be an actual business opportunity in providing a solution to this problem.
In November 2016, along with Saketh BSV and Yogesh Ghaturle, Pathak launched a fintech company called Perpule that gave shoppers the option of walking into a retail store to pick up products, then complete the checkout process using Perpule’s app. There was no need for them to stand in a queue as customers could use the app to scan barcodes, see the relevant pricing information, and pay for the goods in the app.
The company partnered with a few retail chains in Bengaluru, but it wasn’t easy to convince shoppers to use an app for self-checkout at first. That was a hurdle, but there was an even bigger challenge in store for Perpule.
Although the solution was straightforward, it required deep integration with retailers’ systems. The success of their product was heavily dependent on the efficiency of shops’ own pricing and stock cataloging systems, which Pathak said weren’t updated regularly.
The team at Perpule tried to make this work for a couple years, even taking the step to update retailers’ systems, at times working for weeks at length. Eventually, Perpule decided to pivot.
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“Our solution was based on the hypothesis that stores would have a tech-based system where all products would be cataloged—and regularly. The retailers didn’t have a system that could integrate changes in pricing, discounts, and offers on merchandise,” Pathak told KrASIA.
This is where Pahtak said he saw another opportunity, which he said was much more significant than developing tools for self-checkout.
“We showed them the issue with their system, which they agreed with but didn’t have a solution for. We decided to upgrade their old legacy systems, which we saw as a big bottle neck for retailers to start new initiatives. We thought we can add a lot more value there,” he said.
Another problem with retail chains’ billing systems was that they weren’t online, so the chains had no real-time analytics and data about their sales and customers. “If they want to go online, their billing and product cataloging system doesn’t allow them to do that.”
Perpule began developing and updating software that managed retailers’ catalogs and bill-printing process, and updated their inventory with the latest prices and offers. Its point of sale (POS) billing solution, called UltraPOS, is a cloud-based SaaS product that eliminates the need for bulky servers and computers at retail locations, the company said.
“When you go to the billing counter of a store, all the cashier activities such as [the cashier] punching in your phone number, scanning the products you bought, giving store discounts—all of that is maintained by us,” he said.
Pathak said Ultra POS also provides real-time analytics to these stores, and allows them to manage orders and inventory for e-commerce as well as in-store sales from one terminal.
Before pivoting to this B2B model in February 2019, the company raised USD 4.7 million in its Series A round in November 2018, led by Prime Venture Partners. Its existing investors Kalaari Capital and Venture Highway, which had already put in USD 650,000 of seed funding, also participated in the round.
Perpule’s shift helped the company scale its business exponentially. With its self-checkout products, it was present in fewer than ten cities, but the pivot to online catalog and billing took its presence to more than 400 cities in India. Perpule works with big retail chains, such as Big Bazaar, Vishal Mega Mart, More, Spar, Shoppers Stop, and Reliance Mega Mart.
In March, when India went under complete lockdown to contain the spread of COVID-19, the demand for grocery products—one of the only few things that were allowed to be sold in stores—reached new heights. And that is where Perpule saw a new opportunity.
Within 15 days, the team launched a new app called StoreSe that let users order vegetables and other groceries. “We always wanted to do home delivery of grocery products, but this plan was for three to four years later. Because of the coronavirus, the whole thing got fast-tracked,” Pathak said.
Perpule claims to have partnered with more than 2,000 grocery stores in multiple cities. The company only works with major retail grocery stores that are already its customers for the Ultra POS product. “As we already have their catalog information, it makes the job easier to execute,” Pathak said.
In the future, the co-founder mused, he would like to work with small neighborhood stores, but “with Reliance Jio entering this space, we’d rather not do it now, and wait and see how it pans out for them.”
This article is part of KrASIA’s “Startup Stories” series, where the writers of KrASIA speak with founders of tech companies in South and Southeast Asia.