Licious is one of India’s leading online platforms for fresh meat and seafood, known for its promise of delivering high-quality, hygienic, and farm-fresh products directly to customers’ doorsteps. Founded in 2015 by Abhay Hanjura and Vivek Gupta, Licious has disrupted the traditional meat market by offering a trustworthy and convenient way for consumers to buy meat and seafood. With its growing popularity, Licious has become a household name for those who seek fresh, clean, and ready-to-cook meats.
But how does Licious earn profit, and what makes its business model successful in India’s competitive online food market? Let’s explore Licious’s business model and understand how the company generates revenue.
Licious Business Model: Farm-to-Fork Approach
Licious operates on a D2C (Direct-to-Consumer) model, where it controls the entire supply chain—from sourcing and processing to delivery—ensuring the highest standards of quality and hygiene. The company’s focus on providing fresh, clean meat products that are free from preservatives, antibiotics, and chemicals has made it a trusted brand among urban consumers.
Here are the key components of Licious’s business model:
1. Farm-to-Fork Supply Chain: Licious follows a farm-to-fork model, meaning it manages the entire process of sourcing, processing, and delivering meat and seafood. By cutting out middlemen and sourcing directly from farmers and fishermen, Licious ensures that the products are fresh and of high quality. The company processes and packages the meat in its own state-of-the-art facilities, maintaining strict hygiene standards before delivering it to customers.
2. Fresh Meat and Seafood Delivery: Licious offers a wide range of fresh meats and seafood, including chicken, mutton, fish, prawns, and eggs. Customers can choose from raw cuts, ready-to-cook marinated meats, or even specialty items like sausages, kebabs, and cold cuts. The company’s commitment to delivering fresh products within 90 to 120 minutes of ordering has earned it a loyal customer base.
3. Cold Chain Infrastructure: To maintain freshness, Licious has built a robust cold chain infrastructure. This involves keeping the products at optimal temperatures from the time they are processed to when they are delivered to the customer. This cold chain system ensures that the meat and seafood remain fresh throughout the journey, preserving quality and preventing spoilage.
4. In-House Processing Centers: Licious operates its own processing centers, where it cuts, cleans, and packages the meat in hygienic conditions. By controlling this part of the supply chain, Licious can ensure consistency in quality, as well as meet stringent food safety standards. The processing centers also enable the company to offer a variety of cuts and marinated products that appeal to a wide range of customers.
5. Online Platform and App: Licious is an online-first business, with its platform and app serving as the primary way for customers to order products. The platform allows customers to browse through categories, select the type and cut of meat they want, and schedule deliveries at their convenience. Licious’s easy-to-use interface and prompt delivery system have made it popular among urban consumers who prefer the convenience of ordering online.
6. Subscription Model: Licious offers a subscription service where customers can sign up for regular deliveries of their favorite products. This model ensures a steady stream of recurring revenue for the company, while also offering customers discounts and the convenience of getting fresh meat delivered regularly without having to place repeat orders manually.
How Does Licious Earn Profit?
Licious has multiple revenue streams that contribute to its profitability. Let’s take a closer look at how Licious earns profit:
1. Direct Sales of Meat and Seafood: The primary source of revenue for Licious comes from the sale of fresh meat and seafood through its online platform and app. By offering high-quality, fresh products directly to consumers, Licious has built a loyal customer base willing to pay a premium for cleanliness and convenience. The company earns profit by charging competitive prices that reflect the premium quality of the products, while maintaining healthy margins through its direct-to-consumer model.
Licious’s pricing strategy ensures that customers perceive the value in the freshness and hygiene of the products, allowing the company to command higher prices compared to traditional local markets.
2. Value-Added Products (Marinated Meats and Ready-to-Cook Items): In addition to raw meat, Licious offers value-added products such as marinated meats, ready-to-cook items, and pre-cooked products like sausages and kebabs. These products come at a higher price point, allowing Licious to earn better margins. Since these items save time and effort for customers who prefer convenience, they are in high demand among urban households, especially working professionals and young families.
The value-added product range also helps Licious differentiate itself from local meat markets, which typically do not offer marinated or ready-to-cook options.
3. Subscription Services: Licious’s subscription model provides a consistent and recurring source of revenue. Customers who subscribe to regular deliveries of their preferred products benefit from discounts and convenience, while Licious enjoys predictable revenue streams. Subscription services are particularly important for retaining long-term customers and ensuring regular sales, which in turn contribute to the company’s profitability.
4. Private Label and Exclusive Products: Licious has developed its own line of private label products, including specialty meats and seafood items that are exclusive to the platform. By offering unique products that are not available elsewhere, Licious can command premium prices and earn higher margins. These private label products help Licious build brand loyalty and encourage repeat purchases from customers who seek high-quality, exclusive items.
5. Efficient Supply Chain and Cold Chain Management: Licious’s vertically integrated model allows it to maintain tight control over its supply chain, from sourcing to delivery. By eliminating middlemen and handling the processing and packaging in-house, Licious reduces costs and increases profit margins. Additionally, its cold chain management ensures minimal wastage, as products are stored and delivered at optimal temperatures, preventing spoilage and maximizing freshness.
6. Partnerships and B2B Sales: While Licious primarily caters to individual customers, it also partners with restaurants, hotels, and catering businesses (B2B) to supply fresh meat and seafood in bulk. These partnerships provide additional revenue streams, as businesses are willing to pay for high-quality, consistent supply chains. By expanding into the B2B market, Licious can diversify its customer base and increase overall sales.
7. Premium Pricing Strategy: Licious’s focus on providing high-quality, hygienic, and fresh products allows the company to adopt a premium pricing strategy. Consumers are willing to pay more for the assurance of clean, antibiotic-free meat and seafood that meets the highest food safety standards. This premium pricing, combined with the company’s direct-to-consumer model, helps Licious maintain healthy profit margins.
Challenges and Opportunities for Licious
While Licious has built a successful business model, it faces several challenges and opportunities in the Indian market:
1. Competition from Local Butchers and Online Players: Licious competes with both traditional local butchers and other online meat delivery platforms like FreshToHome, ZappFresh, and BigBasket. To maintain its market leadership, Licious needs to continue innovating and expanding its product offerings while ensuring consistent quality and service.
2. Scaling the Supply Chain: As Licious expands into more cities, it needs to scale its cold chain infrastructure and processing facilities to meet growing demand. Managing the supply chain efficiently while maintaining quality and freshness will be crucial for the company’s success as it expands across India.
3. Rising Consumer Demand for Convenience Foods: The increasing demand for ready-to-cook and marinated meats presents significant growth opportunities for Licious. By expanding its range of convenience products, the company can cater to busy urban consumers who prefer quick and easy meal solutions.
4. Health and Sustainability Trends: With more consumers becoming health-conscious and focusing on sustainable food sourcing, Licious has the opportunity to position itself as a leader in healthy, clean, and sustainable meat products. Offering organic, antibiotic-free, and ethically sourced meats could help the company attract a larger customer base.
Conclusion
Licious’s business model revolves around providing fresh, high-quality meat and seafood directly to consumers through a direct-to-consumer platform. The company earns profit through the sale of premium meat, value-added products, subscription services, and partnerships with restaurants and businesses. By controlling its supply chain and maintaining strict quality standards, Licious has built a strong brand in the Indian market. As the demand for fresh, clean, and convenient meat products continues to grow, Licious is well-positioned to maintain its profitability and expand its market reach in the years to come.