Can Quick Commerce Be the Next Game-changer For E-commerce Sector

March 25, 2022
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The recent years have seen a significant boom in eCommerce, and now Quick commerce (Q-commerce) is the next evolutionary step, becoming the next key area to become highly competitive as businesses recognize its potential. The best example is Grofers, an online grocery delivery service, which got re-launched as a Q-commerce company called ‘Blinkit.’ As such, the sector’s popularity is only expected to increase in the future.

Quick Commerce

Consumers in the post-pandemic period have been on the lookout for solutions that might address their everyday demands in a relatively short time compared to what it took previously. Often known as ‘rapid delivery,’ Quick Commerce refers to businesses that quickly deliver products, sometimes as rapidly as under 10 minutes. As a result, this niche market has seen a paid growth in popularity.

Dunzo, Grofers, Swiggy Instamart, and Zepto are some of the key participants in the Indian market, which have received decent funding this year to cater to a scalable need expected to be the size of $50 billion. It’s estimated that Zepto has raised $60 million, while Dunzo garnered $40 million in a fundraiser. But the most significant development has been Grofers garnering millions after receiving over $120 million from Zomato Ltd. and other investors.

Difference from eCommerce

Q-Commerce has some significant advantages over eCommerce, which completely tilts the balance and business preference in their favor. Q-commerce enables real-time product tracking, whereas e-commerce orders are updated only daily. While retailers can only guarantee delivery in 2-3 days, Quick commerce players can deliver in as low as 10 minutes. Additionally, the Q-commerce industry is a subset of the e-commerce sector, accounting for around 4-5 % of the retail sector.

It will also be backed by high consumer demand due to the quick delivery of goods. And according to Redseer’s analysis, being valued at $0.3 billion in CY2021, quick commerce is projected to surge almost 10 to15 times in the coming five years, with the potential to reach $5 billion by 2025.

The market analysts have recorded that as the customer’s expectations are constantly shifting in today’s digital world, only those e-commerce sites are preferable that provide the quickest delivery to the consumers.

Micro-warehouses/ Black Stores uses

The size and type of the warehouses are another critical difference between Q-commerce and regular e-commerce. Q-commerce has local ‘dark shops’ rather than partnering with e-commerce mega-warehouses situated outside of the city. This allows for speedier deliveries of goods from stores to consumers, as dark shops are fulfillment facilities that allow for rapid delivery by being placed in highly populated locations and much nearer to the point of delivery.

Many businesses have set up dark shops to reduce the time it takes to deliver items, the prominent ones being Zepto, Grofers, and Swiggy. As a result of this development, BigBasket, India’s largest online grocery store, too is said to be mulling over launching a 10-minute delivery service under the BB Now moniker. Tata Neu will offer this feature. Following the same path, a social commerce platform Meesho is also considering giving free home delivery on food and grocery purchases.

Only for Start-ups?

We’ve only seen new-age start-ups interested in pursuing this line of operation despite the retail market’s great potential. An important question that arises here is if this is only a start-up phenomenon or whether existing e-commerce enterprises and shops participate as well?

Large corporations, according to experts, would be eager to enter the Q-commerce area in exchange for speedier delivery. It is expected that even giant corporations recognize this as a problem and are working hard to solve it and that it’s not just limited only to start-ups.

Take the point of Reliance Retail, which is working to create ‘SuperApp’ after purchasing Just Dial, a local business listing site that it just purchased, and blending it with its Jio App. Jumping into the fray, the Tata Group has announced the launch of their long-awaited e-commerce platform, Tata CLiQ, to enter the e-commerce industry. These colossal behemoths of the business titans will take note of the issue of speedier delivery and wouldn’t sit idle for long.

Taking the inference from all the analysis, in the end, it’s aptly clear that the supply does not appear to be proportional to the demand. Due to this factor, the sector is expected to see a slew of new competitors enter the market because of the clear need for a speedier delivery mechanism. The majority of the established retailers won’t be sitting idle either. It is expected that they would be racing to keep up with the pace of these newcomers breathing down their necks. The competition to catch the significant share in pie in this hotly contested domain is well and truly on.


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