Why isn't anyone selling beer and liquor online in India yet?

Posted On: June 14, 2022

Posted By: AppsRhino

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Introduction

India's population is 138 crores, qualifying it as the second-most populous country. As there is a vast number of inhabitants, it is apparent that the types of demands vary greatly. Some might like pizzas and fast food, and some relish alcoholic beverages. Although many Indians love treating themselves to a glass of beer, wine, or whiskey, they have their share of struggles in snagging them. India's alcohol consumption was approximately 5 billion liters in 2020, and one can expect it to reach around 6.21 billion liters by 2024. It is worth noting that the amount of consumption and alcohol delivery apps do not align. On the one hand, we have observed the emergence of many online food delivery apps. Still, on the other hand, beer delivery app development is yet to increase. It is a mystery why beer app development is not in demand in a country with considerable alcohol consumption. It might take you by surprise that a lack of willing sellers is not the reason for the lack of on-demand liquor delivery. The unwillingness of the masses to purchase beer via an alcohol delivery app is also prominent. For instance, people are not comfortable sharing their Aadhar card details online. Besides this hesitancy, there is also a lack of freedom when ordering alcohol online- one can order 100 packets of burgers. Still, one might face issues if one orders 100 bottles of beer. Stick around to unearth all other reasons and challenges that hinder beer delivery app development in India.

Summary

What is an alcohol delivery app?

An alcohol delivery app is a bridge between consumers and sellers. Using an alcohol delivery app means not having to go to physical establishments to purchase alcoholic beverages.

What happened in 2020 when liquor vends in India opened after 40 days?

We saw people hoard large amounts of liquor out of the fear that these shops would not stay open for longer.

What are the two modes of alcohol selling in the country?

The first model is prevalent in the states such as Tamil Nadu. Here the government body TASMAC has a monopoly over wholesale and retail vending of beer and other alcoholic beverages. The other model of liquor vending in the country is the auction model. In the auction model, the government invites bids from private players to procure liquor licenses.

What is a license's role in beer delivery app development in India?

One needs to procure a license to deliver alcohol to doorsteps. These orders should be made via mobile apps or online portals.

Why can companies not just acquire the L-13 License and commence selling?

The cost of acquiring and renewing it is high. Moreover, delivery guys of aggregators often get interrogated by the cops while retailers' delivery boys get away with it. Also, it is difficult for aggregators to register the staff members in the state's excise department.

Why do customers not use an alcohol delivery app?

People are uncomfortable sharing their PAN or Aadhar details on an alcohol delivery app. Also, the fixed charges play a pivotal; role in deterring them from using an alcohol delivery app.

Alcohol Delivery App: What is an alcohol delivery app?

An alcohol delivery app is a bridge between consumers and sellers. Using an alcohol delivery app means not having to go to physical establishments to purchase alcoholic beverages. Also, some apps are owned by specific brands or restaurants, and you can order only from them. Apart from this, you will find aggregator apps where you come across different places that sell alcoholic beverages, and you have the freedom to order from any place. Although a few food delivery apps deliver alcohol as well, they cannot flourish in this domain yet. We will read the reason for it shortly.

Beer Delivery App India: What happened in 2020 when liquor vends in India opened after 40 days?

India observed a nationwide lockdown in March 2020 to suppress the spread of the coronavirus. At that time, schools, colleges, universities, malls, recreational places, theatres, restaurants, hotels, etc., ceased their activities. People spent most of their time confined in their homes, sans the things from these places. As a result, when liquor shops reopened, people queued there, hoping to buy stocks of it. The reason to hoard them was not their craving for the beverage. Instead, it was uncertain whether these retail shops would stay open. The thing to ponder here is, why did they feel like collecting them in advance?

The main reason was government policies regarding buying and selling alcohol via online portals, websites, and retail shops. And no points for guessing; these laws are partial towards retail shops.

Let us read in detail about these laws and how grim the situation is.

Beer Delivery App India: The love of License

Currently, there are two main models of liquor sales in the country. The first model is prevalent in the states such as Tamil Nadu. Here the government body TASMAC has a monopoly over wholesale and retail vending of beer and other alcoholic beverages. The other model of liquor vending in the country is the auction model. In the auction model, the government invites bids from private players to procure liquor licenses. The government makes the number of liquor vends it intends to have in a particular state clear. The government divides the whole state into groups A, B, C, etc. Further, they segregate the cities falling under these groups into Excise areas and divide them into zones. A fixed number of vends are available for bidding in a specific zone. Then players bid for a vend on submission of a fee- it consists of refundable and non-refundable amounts. And this bidding war runs to lakhs or crores of rupees based on the locality of the vend. If the locality is posh, one can expect a high bidding amount. You will be astonished that someone auctioned a liquor vend on the Mehrauli border in Gurgaon for 17.52 crores. As a result, these state governments earn thousands of crores from auction processes and license fees. Now, if one starts an online alcohol delivery startup, all these large sums of money spent and earned will go in vain. Thus, numerous restrictions such as regulations, License, consumer age, etc., make it hard for online beer delivery apps and businesses to sustain.

Beer Delivery App India: What is a license's role in developing a beer delivery app in India?

Retailers need to seek a permit or license to sell liquors online. These licenses have exorbitant prices. Besides the high cost, the pain of obtaining licenses is that both a new seller and an old player need to get them. The new seller needs to buy it to start selling alcohol, and the old one needs to renew it to continue their liquor business.

The License we talk about is L-13, and an alcoholic beverage seller must possess it to deliver alcohol to customers' doorsteps. This rule caught the catch: one needed to place the order via email. If someone calls or orders liquor via another communication, the seller can not home deliver the order. This condition was indeed a peculiar one. However, later we saw some amendments to this rule. Now, an individual can order beer or any other alcoholic beverage using mobile apps, websites, or other online portals. Also, this rule prohibits delivering liquor to hostels, institutions, and offices.

So far, we know that online sellers need to acquire an L-13 license to work.

Beer Delivery App India: Why can companies not just acquire the L-13 License and commence selling?

Unlike the food delivery industry, the alcohol industry observes stringent rules and is a state subject. The licenses we told you about cost hundreds of crores for a specific zone, and state governments do not renew them easily. Thus, the task of restoring them is a nightmare. The staff members of retailers deliver alcohol in India. These retailers receive orders via a call or WhatsApp. Retailers have more confidence in these delivery guys and other staff members than in a third-party aggregator. Besides their trust, it is common for police officers to stop delivery guys wearing the t-shirts of the aggregators and interrogate them for having so much alcohol on them. However, the delivery guys working for retailers get away with this by lying that the alcohol they carry is for their consumption. The distinctive feature of delivery guys of aggregators is that they carry a chiller case in which bottles are kept. This distinction makes it easier for the police to spot them and stop them for interrogation.

Even if one assumes that online beer delivery apps and businesses will find a way to tackle these obstacles; Will it be smooth sailing for aggregators, online beer app development companies, and sellers? Let us find out the answer to it below.

Beer Delivery App India: Why do customers not use an alcohol delivery app?

The deterrent for customers is government identification proof. An alcohol delivery app requires customers to submit government identification proof before placing orders. Even though the process is not lengthy, many people are uncomfortable sharing their Aadhaar or PAN details on an alcohol delivery app. Besides the identification hassle, the other concern is the delivery charges. Some states have capped the delivery charges at Rs 100 for orders worth Rs 1,000. Beyond that, for every Rs 500, costs could increase by Rs 25 with a ceiling of Rs 300 on delivery fares. These delivery fee rules make people opt for the traditional means of acquiring alcohol.

Conclusion

The government and its stringent and numerous rules do not allow an alcohol delivery app to succeed. The corruption found in this sector hampers beer delivery app development. If the purchase of alcoholic beverages goes to the digital medium, the government will not be able to earn much. Also, every staff member must register in the state's excise department. This step helps capture the right person if something goes wrong. However, it is not easy for aggregators to procure permits on behalf of the delivery executives. Even with all these factors, some people still opt to buy alcohol via an alcohol delivery app, and this number will surely rise with time. So, if you are an entrepreneur who wants to launch an alcohol delivery app and stand firm amongst the struggles, contact AppsRhino to get an unbeatable alcohol delivery app.