Meesho Business Model | How Does Meesho Make Money

Online purchasing is ruling the market now. With a bundle of eCommerce websites coming into prominence with their wide range of products across niches along with affordable and convenient services for users that can be trusted, purchasing online has become very much a reality.

The fact that online shopping websites and eCommerce stores have been changing the lives of buyers and sellers ever since they emerged cannot be argued. However, it is also important to note here that these websites present enormous opportunities for people who want to be resellers and arrange a decent margin for themselves.

Meesho is one of the greatest examples of an Indian social eCommerce company, which also extends numerous opportunities for small businesses and individuals who want to start their own online businesses with the help of social media platforms like Facebook, Whatsapp, and Instagram.

Founded by batchmates and IIT Delhi graduates Vidit Aatrey and Sanjeev Barnwal in 2015, the Meesho app is a mobile-first eCommerce platform for resellers that includes housewives, domestic oldsters, and others who are fond of using social media channels like WhatsApp, Facebook, Instagram, and others to sell merchandise within their non-public community typically recognized as social circles.

Originally started as Meesho, the name of the company is inspired by “Meri Shop”, translated to "my shop" in English and the thought that it would serve as a shop for everyone in the country.

Today, Meesho's business model has more than a million dealers in over 700 cities in India on its platform. It additionally offers distribution to get admission to a few other 20,000 producers through its platform. Meesho has raised $1.1 billion. Meesho's reselling business works through a huge network of social media platforms. The company recorded revenue of INR 7615 crore in FY24 which is an increase of around 32.8% when compared to FY23, where it earned around INR 5735 crore.

Utilizing the networks created with the resource of using WhatsApp agencies and different social media systems, Meesho's business strategy claims to usher in clients to serve as online dealers at decreased acquisition costs. Right at the onset, Meesho began to draw massive investment from the likes of Facebook, Naspers, DST Partners, RPS Ventures, and Shunwei Capital and currently claims to be a "one-stop destination for women's clothing and accessories," which also an exclusive range of men's fashion along with offering the unique opportunity to become resellers. Regarding reselling businesses, Meesho is often cited as "India's #1 Reselling app, trusted by 1 Crore+ Resellers". Meesho's business strategy focuses on social commerce, empowering resellers, offering a wide range of products, and providing services like logistics and payment processing to drive growth.

Statista reported in 2024 that 5.22 billion+ people from all over the world used social media and the numbers are estimated to be somewhere around 6.05 billion in 2028. This evolving social media landscape is making room for income for many, and Meesho is one of the companies that strongly believes in it and is profiting from it!

Meesho - Latest News
Meesho - Rise of A Social Commerce App
Meesho - Bogged Down by Delivery Expenses
Meesho - Business Model
Meesho - Revenue Model | How Meesho Earns Money
Meesho - Funding and Valuation
Meesho - How to make Money from it?
Meesho - Future Goals and Hindarences

Meesho - Latest News

• FY24: The company recorded revenue of INR 7615 crore in FY24 which is an increase of around 32.8% when compared to FY23, where it earned around INR 5735 crore and reduced its net loss by 81.8%, from INR 1675 crore to INR 305 crore.
• FY23: The company's revenue grew by 77% to INR 5,735 crore, loss narrowed down by 48% to INR 1,675 crore.
• November 19, 2021: Meesho announced the MeeSOP program, which will allow all full-time employees to convert up to 25% of their CTC into ESOPs, which will be subjected to a minimum threshold of INR 50,000.
• April 13, 2021: Meesho diversified its business model to target 100 million small businesses, a plan that pits the startup against online retail giants like Amazon and Flipkart in India.
• April 5, 2021: Meesho raised $300 million in a new round of funding from SoftBank Vision Fund 2, shooting the company's valuation to $2.1 billion, thereby joining the esteemed Unicorn Club.
• FY20: Meesho recorded revenue of INR 341.6 crore in FY20. The company's expenses touched INR 657 crore. As a result, losses spiralled to INR 315.4 crore in FY20.

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Meesho - Rise of A Social Commerce App

Meesho - Bogged Down by Delivery Expenses

Meesho online business claims to have over 15K providers and a pair of million retailers throughout India. It has raised over $1.36 billion from investors solely to establish social dealers and the surrounding market. Meesho announced revenues of around INR 7615 crore in FY24. This is a 32.8% more from the INR 5735 crore revenue the company saw in FY23. However, the expenses of the shopping app continued to grow from INR 7564 in FY23 crore to INR 8150 crore in FY24. Notably, Meesho reduced its net loss by 81.8%, from INR 1675 crore in FY23 to INR 305 crore in FY24.

Meesho’s resellers shortlist merchandise from the stock and try to share them with those who are within their community of consumers, including their own circle of relatives, members, pals, or other acquaintances. Resellers are allowed to promote the goods at fees that they deem healthy for their target consumers. Once the merchandise is shortlisted, the reseller locates the order with Meesho and enters the deal along with arranging for the transport. In most cases, Meesho helps with the deliveries with the help of its huge network of logistics service providers operating throughout the country. This service is free of cost!

Meesho also offers customers free cash-on-delivery services. Therefore, the only thing that's currently bothering Meesho and its services is the loss that the company is still seeing.

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Meesho - Business Model

The company primarily operates as a social eCommerce platform, thereby following a D2C model. The business model of Meesho can also be explained as a B2B along with being a B2C if we highlight the reselling opportunities that Meesho brings in! Meesho is focused on 20 million+ resellers. Meesho's business model operates just like the business model of any other eCommerce service provider. With 50% of Meesho’s target market relying on Tier 2, 3, and 4 cities, the corporation claims to have a presence in 1000+ cities, which facilitates resellers to begin promoting with 0 funding.

• Earning Commissions from Suppliers: Suppliers who list their products on the Meesho platform are charged a commission, which may vary depending on the product category.
• Earning Commissions from Resellers: Meesho charges resellers a commission ranging from 10-20% of the product price.
• Advertising Opportunities: Meesho provides a platform for brands and businesses to advertise and generate revenue by offering advertising space.
• Shipping Fees: The Meesho platform charges shipping fees to customers who make purchases.
• Commission and Revenue Structure: The commission and revenue structure adopted by Meesho is as follows:

1. Suppliers: Suppliers are subject to pay a commission fee that varies between 10% and 25% of the price of the product.

2. Resellers: When resellers sell products, they are charged a commission that varies between 10% to 20% of the price of the product.

3. Customers: Customers are obligated to bear the shipping charges, which usually range from Rs. 100-200.

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Meesho - Revenue Model | How Meesho Earns Money

As a reseller, you want to percentage a product that is indexed at the Meesho app around your community on social media systems and you may earn a fee regularly on a sale basis. There are lakhs of products to pick from, and as a reseller, you don’t have to fear the logistics, payments, and delivery of a product that you sell. Meesho works in the industrial enterprise version, which is comparable to different e-trade companies. Let’s break down Meesho’s sales streams and how they generate revenue, outlining their revenue model.

Commission

Just like Amazon, Meesho makes money with the help of commissions from the sellers. The company charges around 10-20% commissions from the sellers.

Logistics

Meesho's shipping expenses are a little high but the company is looking to push that down. However, with the help of cutting-edge logistics technology, Meesho adds some bucks to its overall revenue.

Advertisements

As the number of dealers is increasing each day, Meesho considerably adds to their income by featuring them on their app and website. Meesho charges sellers who want to showcase their products on the platform a significant amount.

Data

All of us are aware of the concept of big data, where data is almost as treasured as oil, if not more. Meesho takes hold of a huge amount of data, a part of which it sells to its partner companies so that they can use it for their own benefit and the benefit of the consumers. However, Meesho strives to keep the consumers' data and other sensitive data safe with them.

Meesho Financials FY24

In FY 2024, Meesho's operating revenue grew by 32.8% from INR 5735 crore to INR 7615 crore. Total expenses increased by 7.7%, rising from INR 7564 crore to INR 8150 crore. Employee benefit expenses saw a marginal increase of 3.3%, from INR 726 crore to INR 750 crore, while logistics and fulfillment expenses rose significantly by 23.1%, from INR 4817 crore to INR 5927 crore. Notably, Meesho reduced its net loss by 81.8%, from INR 1675 crore to INR 305 crore.

While the Meesho business app is spending closely on helping last-mile transport for its social sellers, the organization is also earning from the same. Meesho charges a standard delivery fee plus a 10 - 20% commission based on the product from all the sellers that the organization has listed thus far. Further, it additionally expenses a hefty penalty for product returns.

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Meesho - Funding and Valuation

Meesho has raised $1.36 billion in funding across 13 rounds as of May 2024. The fund it raised was led by some of the best Venture companies and angels, including YC, Facebook, Naspers, Sequoia Capital, Shunwei Capital, Westbridge Capital, and SAIF Partners.

Meesho's latest funding round, a venture round, took place on May 6, 2024, where the company raised $275 million.

The talks of the upcoming Meesho round took shape in the form of a gigantic $570 million round led by Fidelity Management and Eduardo Saverin's B Capital Group, which the company raised today, September 30, 2021. This helped the company more than double its valuation from what it recorded six months ago to attain a valuation of $4.9 billion. The previous round led by Softbank helped the company to mop up around $300 million to attain the unicorn status.

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How To Make Money from Meesho?

Yes, you can definitely earn from Meesho. As Meesho proclaims itself as India's number 1 reselling app, it surely has its own perks. To make money on Meesho, You can simply choose from the products indexed on the Meesho app and share them around your community on WhatsApp, Facebook, and other social media platforms, different pages, and agencies. You may earn a fee that is in line with its policies.

As soon as you share the products, you will start to receive inquiries. You can then simply add your margin on top of the product charges and shipping charges and disclose the final price to the customer. Place the order on the app only after a customer confirms the order. The customer would get the order delivered within the next 2-3 business days, and all the while, you can conveniently track the order on the app.

Please note: In case you place a COD order, your customer would have to make the payment to our logistics partner. Once Meesho receives the payment, it will then transfer the margin that you are entitled to back to your bank account within ten working days or the digital payments provider that is aligned with your economic institution.

List of Items you can Sell on Meesho

Meesho is an Indian-based mobile application. Meesho is a social commerce platform. The company was founded in the year 2015 and is established in Bangalore. The company helps small businesses to start their business through certain social channels which involve WhatsApp, Facebook, Instagram, etc. …

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Meesho - Future Goals and Hindarences

As Meesho moves forward, it faces various challenges, including:

• Competition: Meesho is facing competition from various social commerce platforms such as Flipkart, Shopsy, and Amazon's Seller Central.
• Regulation: The Indian government is currently considering regulations that could potentially impact the social commerce industry.
• Fraud: Some resellers have been caught selling fraudulent products, which Meesho is currently addressing.

Future Plans

Despite facing hurdles, Meesho has a strong team and user base, and a proven business model. The company is also expanding into markets in Southeast Asia and Latin America.

Meesho plans to use around $300 million of its main funds to pay taxes from moving its headquarters back to India from Delaware. The company is getting ready for an IPO in India and has raised a total of $1.36 billion since it started in 2015. It became profitable in July 2023.

FAQs

How much is Meesho's Revenue?

In 2024, Meesho's revenue grew to INR 7615 crore, and losses narrowed down to INR 304.9 crore.

How does Meesho make money?

Meesho charges a standard delivery fee plus a 10 to 20% commission based on the product.

What does Meesho do?

Meesho app is a mobile-first eCommerce platform for resellers consisting of housewives or at-domestic oldsters that then use channels consisting of WhatsApp, Facebook, Instagram, and others to sell merchandise inside their non-public community, typically recognized as social circles.

Who is the founder of Meesho?

Vidit Aatrey and Sanjeev Barnwal are the founders of Meesho.

What is Meesho launch date?

Meesho was launched in December 2015.

Is Meesho B2B or B2C?

The business model of Meesho can also be explained as a B2B along with being a B2C if we highlight the reselling opportunities that Meesho brings in.

What is Meesho business model?

Meesho is a social commerce platform that lets resellers sell products through social media. It earns by charging a commission on sales and offering services like logistics and payment processing.

How Meesho works?

Meesho connects sellers with resellers who sell products through social media. The resellers share product links, and when people buy, Meesho handles the delivery and payment.