What is Quick Commerce?
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Quick commerce is a one-of-a-kind business concept in which goods and services are delivered within the shortest period possible. To be precise, it’s often just within 10 to 30 minutes after the booking is made. Quick commerce generally concentrates on micro to small or fewer commodities, such as food, stationery, personal hygiene products, and over-the-counter pharmaceuticals products.
The emergence of quick commerce directly resulted from the supply chain disruption, which COVID-19 caused due to the COVID-19 pandemic, which forced businesses across the globe to create a new and unique business model where the delivery of goods and services gets done within 10-30 minutes of ordering.
Also known as “on-demand delivery” or “e-grocery,” Quick commerce focuses on micro to small amounts of goods, specifically for fewer commodities such as food products, stationery, personal hygiene products, and over-the-counter medicinal products. Quick commerce doesn’t attempt to imitate the more significant, fancier retail chains like BigBazaar or Walmart shop. Instead, it aims to use the dark store concept to become the largest Kirana shop in an urban colony, usually situated near housing complexes, with the necessary SKUs.
To the uninitiated, a dark shop generally serves a 2-kilometer radius. Home delivery-focused companies like Dunzo, Swiggy Instamart, Blinkit, etc., have already been operating nearly 20-30 smaller-scale shops in the top 10 cities with their 10-to-20-minute delivery services.
The priority of eCommerce platforms has evolved away from conventional well-stocked, massive warehouses on the outskirts of cities and towns and moved toward micro-warehouses located nearer the delivery point. Additionally, these businesses try to limit stocks and supplies to a small number of high-demand products, mostly under 2,000.
Some of the benefits of Quick Commerce are:
A significant advantage that the quick commerce companies have compared to a conventional retail outlet is that they can deliver goods to customers in a fraction of the time it takes for a traditional retail outlet to do the same.
● Guaranteed availability of products
Because of the investments in AI and technology that monitor demand and modify inventory in real-time, goods now are not just merely delivered faster. Still, they are more likely to be available whenever they are needed.
● 24-hour operation
Dark stores can operate 24 hours a day, 365 days a year, which is probably the most significant benefit of quick commerce and a real game-changer, as they are not bound by the same rules of the daily opening hours as the brick-and-mortar stores are bound to have.
An example of the eCommerce platform shifting to quick commerce, and quite a prominent one too, is Grofers. Grofers recently got itself rebranded to ‘Blinkit,’ the business paradigm being that the impending shift from eCommerce to quick commerce intends to deliver orders to customers considerably more quickly than it has been doing earlier.
The CEO of Grofers stated that they repurposed the goals of their infrastructure after all the learnings they acquired and switched from eCommerce to Quick commerce. Quick commerce justified the aim behind the move as brisk commerce having an excellent product-market fit to adapt to the latest industry demand of delivering goods at a much faster pace and in a concise amount of time.
Grofers’ top management elaborated that the company aspires to reach a $1 billion annual gross merchandise value (GMV) run rate by March 2022, which is significantly higher than the current GMV run rate of $600 million on its platform. They further elaborated that they already have 4 million orders per month and are expanding at a 2X monthly pace. Despite functioning across 12 cities in the country and processing over a million orders every week, over the years, the company has lost substantial market share to Bigbasket and was increasingly losing more ground to them. As a result, it decided to transform itself and switch from a traditional grocery business strategy to a quick commerce business model. As the statistics earlier suggested, short commerce wholly justified the reason behind the transformation too.
Let’s look at some of the Quick Commerce Companies in India.
Some of the leading players in the quick commerce business model include food-tech platform Swiggy’s Instamart, Dunzo Daily, Mumbai-based Zepto, etc. They are growing at a phenomenally exponential rate. It is expected that Swiggy’s Instamart will start delivering within 15 minutes by January 2022 via several dark shops near most of its consumers, followed shortly by Flipkart, Ola, Blinkit BigBasket, and Zepto.
While observing the recent trends and shifts, it may be safely concluded that quick commerce will be the future of commerce and that in the next few years, the transition of online vendors from traditional business models to quick commerce business models will be the inevitable outcome.
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