Even with substantial investments from e-commerce leaders like Amazon and Walmart, traditional brick-and-mortar retail continues to account for over 95% of total sales within India, the world’s second-largest internet market.

These major companies have recognized the significant influence of local shops and have recently been seeking strategies to collaborate with them. The market landscape has become even more dynamic with Mukesh Ambani, the wealthiest individual in India, actively working to facilitate online sales for these neighborhood stores.

However, the potential market remains considerable, and many facets of conventional retail could benefit from technological advancements. This is the core belief driving WareIQ, a Bangalore-based startup supported by Y Combinator. The company has recently secured $1.65 million in seed funding from YC, FundersClub, Pioneer Fund, Soma Capital, Emles Venture Advisors, and the founders of Flexport.

Established just a year ago, the company operates a platform that utilizes existing warehouse facilities throughout the country. It has developed a management system specifically for these warehouses, many of which primarily handle offline business-to-business transactions and have limited or no prior experience with e-commerce.

“We integrate these warehouses across India into our platform and leverage their existing infrastructure to process e-commerce orders,” explained Harsh Vaidya, co-founder and CEO of WareIQ, in a conversation with TechCrunch. The company provides this functionality as a service to various retail businesses.

These businesses include third-party sellers (some of whom already sell on platforms like Amazon and Flipkart and utilize WareIQ to accelerate their delivery times), e-commerce companies, social commerce platforms, local stores, and social media influencers.

For example, any online retailer can send their products to WareIQ, which offers integrations with several well-known e-commerce platforms and marketplaces. The company collaborates with courier services to efficiently move products between warehouses, ensuring the quickest possible delivery, as Vaidya detailed.

The infrastructure established by WareIQ also allows online sellers to create their own independent stores and interact directly with customers, reducing the fees they would typically pay to larger e-commerce businesses like Amazon.

“Previously, sellers were unable to accomplish this independently because it required direct negotiations with warehousing companies, often involving strict contracts, substantial security deposits, and the need to integrate multiple technology solutions,” he stated. WareIQ also provides these sellers with services such as last-mile delivery, cash collection, and fraud prevention.

“Essentially, we are creating an open-source fulfillment service similar to Amazon, where any seller can send their goods to any of our warehouses, and we can fulfill orders from Amazon, Myntra, Flipkart, or their own websites. We also adhere to the requirements of each marketplace, allowing our sellers to achieve benefits like the Prime designation on Amazon,” he added.

WareIQ offers free registration and charges a fee based on the volume of orders processed. The startup currently works with over 40 fulfillment centers and intends to use the new funding to expand its network into smaller cities and towns. They are also actively recruiting for various technology positions.