Indian e-commerce company GlowRoad is built on a simple premise. By connecting manufacturers with resellers and using drop shipping, it keeps everyone’s overhead costs low. The Bangalore-based startup, however, doesn’t just aspire to be an online reseller network. Founded by a former physician, GlowRoad’s goal is to give housewives and stay-at-home mothers a low-risk way to start their own retail businesses from home.
GlowRoad, which secured $2 million in Series A funding from Accel Partners earlier this month, currently claims 100,000 registered users, 36,000 of whom are active resellers. Most selling takes place in WhatsApp groups or in-person and GlowRoad claims that its resellers complete about a total of 1,000 transactions every day.
While some resellers do keep physical inventory in their homes, most products are shipped directly from manufacturers to buyers. The company’s business model is designed to benefit resellers by letting them build an online store without managing stock and suppliers who have a ready-made distribution network.
“The idea is that women should be able to earn from home, without putting in any money and it should be a secure system, but if you look at it from a business person’s point of view, what it becomes is a very strong sales network,” says founder Sonal Verma, who acqui-hired the team behind LocalQueen, a reseller network, two months ago to build GlowRoad. “So if you launch something and want to launch it in all the cities in India, you can do so very rapidly and very cost-effectively through this channel.”
While working as a physician, Verma focused on community medicine before co-founding a telemedicine startup called HealthcareMagic.com. Going from medicine to e-commerce might seem like an odd path, but Verma says she was inspired by the women she treated.
“I wanted to work in a venture that empowers women and I saw a lot of reselling happening in my neighborhoods, so that put the idea in my head,” she says.
The consulting firm says about two million women have already made $9 billion in gross sales by reselling clothing and lifestyle products online, and that the number of “housewife resellers” is expected to increase to 21 million to 23 million by 2022.
GlowRoad’s suppliers offer goods at wholesale prices and resellers decide what margin to charge on top of that. While sellers have an online storefront on GlowRoad, they usually market their products through WhatsApp and Facebook groups or in their residential communities. GlowRoad monetizes by charging its suppliers 500 rupees a month (about $7.70), while resellers pay to unlock premium features.
GlowRoad’s biggest category is fashion, with Indian ethnic wear moving the most products, says Verma. Cosmetics and jewelry are also popular.
“WhatsApp has changed a lot of things for everyone,” says Verma. “Most ladies have fairly large WhatsApp groups and are members of multiple ladies groups on WhatsApp or Facebook. When they become serious resellers, they start doing it by sending more messages, saying that I’m in this kind of business, and then they start to make their own groups for their business.”
As each reseller’s business grows, GlowRoad teaches them how to run Facebook ads and optimize search results for their GlowRoad online stores. Since most GlowRoad resellers use drop shipping, it only takes them a few minutes to fill their online stores with listings.
Relying on drop shipping, however, comes with several risks. For example, not seeing a product before it reaches customers means resellers have very little control over quality. GlowRoad mitigates this by sending members of its team to vet manufacturers before adding them to the site and then using a review system that rewards top suppliers by setting them up with the site’s newest resellers.
Verma says some of GlowRoad’s Series A funding will be used to ensure that its quality assurance system can scale up. The company also plans to hire more people to build its digital marketing team and tech platform.
“Improving supply side is what we are working on the most at the moment, but we’ll ensure they have the best quality products,” says Verma.