Prerna Kalra, Co-founder and CEO, Daalchini Technologies

12 Sep 2022 , 12:58 PM

Help us understand the business model of Daalchini

Daalchini Technologies is a full-stack retail-tech startup started by ex-Paytm executives Prerna Kalra and Vidya Bhushan in 2018 with a vision to create an ecosystem of autonomous retail. Its product suite has a complete platform to launch vending machines, micro-markets, automated kiosks, and mobility solutions.

Daalchini is India’s first 24/7 instant snacking destination that provides affordable, healthy snacks, and home-style meals through IoT-enabled ‘phygital’ (physical+digital) vending machines and smart stores. Daalchini’s phygital vending machine/kiosk offers an array of products from café-packed savories, and bakery products to ready-to-eat and premium proprietary products and packaged food.

Daalchini earns revenue from the subscription on vending machines, profit margins on products (Snacks & Food), advertisement and listing through Daalchini machine and app, and through its franchise model (software, franchise fee, etc.).

Currently, Daalchini runs a network of more than 850 vending machines across 11 states and 23 cities in India including Delhi-NCR, Mumbai, Pune, Bangalore, Chandigarh, Lucknow, Indore, Ahmedabad, etc. We have our smart vending machines installed across various sectors like Offices, colleges, schools, manufacturing plants, hospitals, hotels, etc.

We have clients like Reliance, Aditya Birla Group’s Hindalco, Samsung, Vodafone, GE, OLX, OYO, VIVO, NITI Aayog, Loreal, Byju’s, Paytm, E&Y, Snapdeal, Fortis hospitals, etc.

What are the company’s unique strengths?

Our autonomous retail technology enables both perishable and nonperishable items through vending machines. Thus enabling them with fresh food. Our tech suite also uses IoT retail to keep food safe, and healthy while allowing us to monitor it remotely.

We employ a tech-driven, temperature-controlled supply chain that is not demand-driven but forecast-driven led by machine learning-based projection tools.

We have built a platform for brands and retailers to deliver under ₹99 food instantly at zero delivery cost through autonomous retail outlets including vending machines, smart fridges, and mobility retail solutions. We have developed mini vending machines for buses and cabs.

Alongside enabling brands to sell their products through its smart vending solutions, Daalchini operates a franchise model to let people generate income by setting up their own smart vending machines and building smart stores in their preferred locations.

What were the company’s revenues, EBITDA, and Profit After Tax for FY22?

The company has grown 300% in the last 12 months, making it one of India’s fastest-growing RetailTech startups. It has achieved a Product Market Fit (PMF), with Rs12 crore of revenue in FY22. More than 90% of our vending machines are EBITA positive within 45 days.

Daalchini aims to clock Rs50 crore in revenues with a GMV of Rs130 crore in the 12 next months. The company is already at Rs20 crore ARR as of date for the current financial year.

We intend to grow from 850+ to over 5,000 smart and autonomous retail points in the next 12-18 months.

What are the key margin drivers for the company going forward?

• Product margins (Packaged & Fresh Food)
• Monthly subscriptions from customers and clients
• SaaS from franchise fee
• Listing and advertising fees from brands

Currently, which regions in India are you present in? By when do you plan to have a pan-India presence?

We are already operating across the country with our vending machines installed across 11 states and 23 cities in India including Delhi-NCR, Mumbai, Pune, Bangalore, Chandigarh, Lucknow, Indore, Ahmedabad, etc.

Daalchini aims to establish its footprints at every 200 meters of habitable area with its autonomous smart stores and vending machines.

Share with us your growth strategy?

I along with my other co-founder Vidya Bhushan who was also working at Paytm started Daalchini in 2017 with an aim to bring intelligent retail through IoT-enabled smart vending machines in India.

We started with 1 vending machine from Noida and are now at more than 850 smart vending machines in 23 Indian cities including Delhi-NCR, Mumbai, Pune, Bangalore, Indore, etc. as of September 2022.

We believe that through Daalchini we have been able to bring a positive impact on the lives of people whether they are our end customers or a D2C brand or cloud kitchens.

We have been able to enable our vending machines with fresh home food serving users in offices, hospitals, hostels, hotels, apartments, metro stations, educational institutes, etc., and help D2C brands, home chefs, and cloud kitchens to scale much faster than the traditional way.

Our solution has given them a low cost and one of the fastest distribution channels to sell their products across the country.

We are changing the way people shop or buy products. The last decade was for e-commerce and this decade is going to be for V-commerce or intelligent retail.

We have been able to deploy more than 850 vending machines in 20 Indian cities within a short span of time of 4 years only. We have the fastest growth rate in Industry with 3X growth in the last 3 quarters and acquiring a few Fortune500 clients even though being a startup within 3 years of business.

We are trusted by some of the big organizations like Reliance, Aditya Birla Group’s Hindalco, Times Internet, NITI Aayog, LG, VIVO, Whirlpool, Fortis, Max, etc.

During covid, we pivoted from being mostly present incorporates to manufacturing sites and industries.

Daalchini is the first to launch home-food vending machines and intelligent retailing solutions in India. We built a technology lead path-breaking business model to create micro-entrepreneurs resulting in 200+ franchise lead stores, hence the fastest-growing franchisor in the Food & Beverage Industry.

We have also enabled discovery and instant fulfillment for 65+ brands through India’s most sustainable and intelligent retailing network.

Last year we launched India’s first mini-vending solution for Cabs & Buses, hence targeting 527000+ cabs and buses in Tier 1, and Tier 2 cities and generating an additional source of revenue for drivers and fleet owners.

What are the key challenges facing the company? How is the company mitigating the same?

Initially, after setting up the vending machines, cloud kitchens and tiffin services were not prepared for food items specific to vending machines. We then started preparing our own checklist along with food consultants and food experts to find what it takes. This became our bible and rule book while onboarding cloud kitchens and tiffin services.

Particularly post-pandemic, customers were concerned about hygiene and safety. We launched our 100% contactless kiosk solution then which helped in further adoption.

As part of its commitment to serving 6-meals-a-day, Daalchini is creating a sub-99 food store to enable brands in all F&B categories (like Frozen, Chilled, Meal-kits, Snacks, Bakery, Immunity Boosters, Healthy/Energy drinks, Yogurts, etc.) to reach their targeted audience and help them scale fast across multiple geographies.

Currently, there is no major challenge ahead of us, we are on the right track, growing steadily in terms of our offerings, tech, product, teams, etc.