Best Business Models To Launch An Online Grocery Business

By Hyperlocal Cloud

September 27, 2023

Best Business Models To Launch An Online Grocery Business

Nowadays, getting your favorite grocery delivery item is made easy with online grocery delivery apps. People who are willing to purchase groceries can order them in a matter of clicks. Online grocery delivery apps have been convenient since their inception. As the apps rise in demand and competition, entrepreneurs are trying different business models to make high revenue.

So here in this blog, we have brought you unique business models for your grocery delivery platform. We will understand each and every aspect of these models and learn how they can help make money. Let's get started exploring:

What Is An Online Grocery Delivery Business?

A grocery delivery business provides a better approach to delivering groceries to customers using an app. In this business, you will be conducting a grocery store, receiving orders, and delivering them to an indicated location. This business comes with profit, convenience, and accessibility. A platform developed by an on-demand app development company can level up your business and help you achieve a competitive edge.

To start an online grocery business, you need to research the market, analyze your competitors, know your target audience and build an app. Along with these, you will also require some revenue-making strategies to grow your business economically.

In order to choose a business model, we have got you covered. The blog is not just about helping you out with business models but also about how a grocery delivery app aids you in boosting sales.

Forecast Of Online Grocery Delivery Business

Let's explore and know the financial growth in the online grocery delivery business

  • The revenue in the grocery delivery market is estimated to reach $627 billion before the end of 2023.
  • Market revenue in the online grocery business is growing at a CAGR of 16.11% between 2023 - 2027.
  • The online grocery portage business is projected to reach $1,140 before the end session of 2027.

Launch An Online Grocery Delivery Business App

We help clients to build a grocery delivery app as per their needs, generate sales, and increase brand awareness.

Top 5 Business Models To Launch Online Grocery Delivery Business

Now, let's discuss 5 business models for your grocery delivery business. Here are some of the best:

Inventory Based

In this business model, the owner purchases the stock from the various suppliers and stores it in their maintained warehouse. The business owner is the only entity that handles all the transactions. Here an online grocery delivery platform can help manage the inventory and track products.


The benefits of an inventory-based business model are:

  • Able to manage the entire supply chain
  • No third-party intervention for sale & purchase
  • Inventory-based business models help in rapid dispatch and delivery
  • Build customer trust, high sales, and increase engagement with new users.

Multi-Vendor Marketplace

The multi-vendor marketplace business model, also known as the zero inventory model, allows several buyers and sellers to gather and trade on a single platform. Everything from order to shipping is managed through a multi-vendor marketplace app. A business owner here charges a cut from the overall sale as net worth.


Such a business model has proven beneficial in providing services. Here are some advantages:

  • With an online platform, it digitizes business and automates several operations
  • Reduces the financial burden on the owner because it lets vendors manage their inventory on their own
  • Helps increase user traffic, as it lets customers compare products from different vendors
  • Reduces the operation cost because it eliminates maintaining inventory

Hyperlocal Model

A hyperlocal business model focuses on the needs of a specific geographical customer. This model comes with a goal to fill the gap between supply and demand. A hyperlocal business model includes services like medicine, alcohol, grocery, and food delivery. There is a limited range of service areas while working with this model.


The hyperlocal business model offers effective benefits:

  • Efficient and uncomplicated for the suppliers
  • It supports traditional stores to optimize their sales
  • Local vendors can list their products on the platform and reach a number of customers automatically
  • Every transaction is managed by the aggregator
  • As it reduces carbon footprint by delivering products to a specific range, it is an environment-friendly business model.

Shopping Model

It is the most used business model for online grocery delivery businesses because it operates by collaborating with local grocery vendors. The main difference of the shopping model is that it doesn't allow users to choose the store while ordering. All processes like order management, dispatch, and delivery are handled by the owner.


The shopping business model has many benefits to serve:

  • Faster deliveries
  • The vendor assures quality because groceries will be dispatched from them
  • Easily reach a mass number of customers and increase brand awareness
  • Offers multiple-payment options

Click & Collect

This business model allows users to purchase their groceries online and collect it by visiting the store. It provides contactless delivery and is being used in North America widely. Brands like Walmart, Instacart, and Safeway stand as examples of such business models.


The advantages are as follows:

  • It helps increase sales by charging extra on picking up the order or on any additional purchase from the customer
  • It saves transportation or delivery cost
  • A business owner can offer additional groceries on behalf of pre-booked grocery items. That helps generate revenue.

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Core Features To Include In Online Grocery Delivery Business App

Features in an online grocery porting app help ensure, plan, and monitor growth in business. Here, we have categorized the features into 4 parts: vendor app, driver app, customer app, and admin panel:

Customer App

Our customer app features let users interact with the app easily and place an order:


Users can log in and sign up with their name, contact, location, and other information.

Browse Menu

It lets users browse through the store's menu with different grocery items and their availability.

Cart & Checkout

Users can create a collection of their favorite groceries and place an order instantly.

Payment Gateways

Users can pay for the overall amount using credit/debit cards, UPI, net banking, Amazon Pay, Google Pay, and cash on delivery.

Push Notification

Push notification lets users update about their order's placement, status, arrival, and other activities in the app.

Live Tracking

Users can track the driver's status and ETAs using our live tracking feature.

Rating & Reviews

It allows users to rate the grocery delivery based on its quality. They can also write suggestions & feedback on the app.

Schedule Delivery

Users can schedule the date & time of receiving their groceries.

Vendor App

With our vendor app features, easily manage orders and deliver on time.


Vendors can register their shop with name, location, contact, and service type.

Product Listing

With this feature, vendors can list the groceries based on price, description, and availability.

Order Management

The order management feature lets vendors accept, decline and manage incoming orders from a customer.


It will let vendors receive payment via e-wallet and other payment gateways.

Order Notification

An alert bell is embedded to be aware of upcoming order requests from the customer.

Call & Chat

Vendors can connect with users at any time via chat and call.

View & Reply Feedback

It will help vendors to view and reply to customers' feedback and ameliorate their service.

Delivery App

We implement first-grade features in our online grocery delivery business app for drivers so that they can take assignments and deliver them without any problem.

Delivery Alert

It notifies them instantly whenever a grocery store assigns a delivery task to a delivery partner.

Task Management

Delivery personnel can accept and decline an upcoming request from the store.

Call & Chat

Call & chat helps delivery personnel to call and chat with the customer to take instructions.

Live Map

It lets delivery partners be aware of ETAs, distance, shortest route, and traffic on their app.

Customer Information

Customer information displays the customer's relative information like name, location, and what they have ordered.

Total Earning

The total earning feature helps delivery personnel to generate an invoice for how much they have earned.

Also Read: Advantages Of Building An On-Demand Grocery Delivery App

Admin Panel

Our online grocery delivery business app comes with top-tier admin features so that they can control their business in their comfort zone:


Our admin dashboard comes with infographics, animations, charts, and other essential details which track ongoing processes in the business.

Call & Chat

It allows admins to contact delivery partners or vendors at any time via call and chat.

User Management

Admins can control users of the app. They can easily remove and add users at any time they want.

Order Management

Order management helps the admin to accept and cancel an order from their desk. It can be done on request from the customer, too.

Subscription Management

It allows users to add or remove users on behalf of their subscription status. They can also offer discounts based on the performance of a particular customer.

Generate Invoice

Admins can generate invoices on their overall sales and revenue and track expenses with a click. They can also download the invoice in PDF format.


These mentioned business models to launch an online grocery delivery business can help any size of business to grow its niche and reach a maximum number of customers. However, all these business models require a marketplace app to run successfully, so an on-demand app development company takes place significantly. We at Hyperlocal Cloud help you attain an application that is built with cutting-edge technology and several monetization options and offers a custom business model for implementation. So what are you waiting for? Start with us today.

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