Quick commerce or quick e-commerce refers to the delivery of grocery and daily essential items within a short span of 15-30 minutes. This emerging trend is revolutionizing the online shopping experience for consumers globally. With Covid-19 accelerating the adoption of e-commerce, quick commerce startups are capitalizing on this opportunity by offering instant deliveries to customers. Several unicorn startups have emerged that are providing hyperlocal delivery at scale through sophisticated tech-enabled supply chains and large fleet operations.
Many quick commerce startups have raised large funding rounds in 2021 to boost their operations.
These startups leverage dense micro-fulfillment centers, known as 'dark stores', located in high density neighborhoods for ultra-fast order picking and dispatch. Advanced algorithms help route optimized delivery paths to reduce delivery times. Large contracted fleets of delivery partners equipped with insulated bags ensure orders are delivered within the promised window.
Extensive selections including fresh produce, meat, eggs, beverages and packaged goods are stocked based on predictive demand analytics. Regular restocking ensures high in-stock rates. The convenient experience has seen these platforms garner millions of customers within a short time of launch. Growth has especially been high among Gen Z and millennial consumers.
Competition and Innovation in the Space
The success of global players has led to increased competition. Grocery retail chains and food delivery giants have also entered the quick commerce arena. For example, DoorDash launched ‘DashMart’ dark stores in 2021 while Walmart partnered with Gopuff to pilot 15-minute deliveries in the US.
Players are innovating to differentiate and stay ahead. Gorillas launched a subscription model ‘Gorillas Unlimited’ which waives delivery fees for a monthly fee. Jokr offers fresh ready to eat meals using regional cuisines. Flink tied up with retail partners like Spar to offer their inventory through Flink’s network. Players are exploring electric vehicles, autonomous delivery robots and drones to optimize operations further. Partnerships are also being forged with nearby stores to source inventory and expand selections offered.
Regulatory Hurdles and Sustainability Questions
While quick commerce fills an urgent consumer need, some concerns have emerged. ‘Dark stores’ face opposition from local communities and regulators over rapid proliferation and related issues like congestion. High delivery volumes have raised questions over environmental sustainability and better working standards for gig workers.
Regulators in some cities require permits and compliance with zoning laws for warehousing activities from these spaces. Players need to focus more on community engagement as well as sustainability practices like carbon neutral deliveries, utilization of electric vehicles and fair compensation policies for workers. Addressing these issues will be critical for the long term viability of this emerging sector.
Market Outlook
The global quick commerce market is expected undergo rapid growth in the coming years. North America and Europe currently dominate the market led by strong operations of players like Gorillas, Gopuff and Getir. However, APAC regions like China, India and Southeast Asia are projected to see exponential gains. Lower penetration of traditional e-commerce and presence of vast urban populations make these emerging markets highly lucrative. If quick commerce platforms can provide consistent and affordable service, they are well positioned for mainstream adoption. For more insights into trends, players and projected revenues in this space, refer to the market report on global quick commerce published by Coherent Market Insights.
In conclusion, quick commerce fills an important gap for time-starved online shoppers. Backed by solid unit economics and growing customer base, leading players are poised to scale globally. Though challenges around sustainability, regulation and community relations need addressing, quick commerce has the potential to disrupt traditional retail significantly if the unit economics remain favorable over the long term. With Covid accelerating shifts to convenience-driven purchasing, quick commerce is likely to witness exponential growth worldwide over the next decade.
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