Quick commerce is here to stay

“Like any other sector, FMCG companies are also experiencing significant benefits from the rise of q-commerce, focusing heavily on ultra-fast deliveries. This shift is being driven by changing consumer expectations and the need for speed in delivery, leading to substantial growth in e-commerce sales,” says Somdutta Singh, angel investor, Founder and CEO of Assiduus.

Singh adds that quick commerce enables FMCG brands to penetrate urban micro-markets.

For instance, by utilizing local warehouses or dark stores, companies can ensure faster deliveries and better serve densely populated areas.

“This strategy not only improves service speed but also allows brands to access new customer bases that value quick service. The immediacy of q-commerce encourages impulse purchases, as consumers are more likely to buy items on a whim when they know they can receive them almost instantly,” she says.

“This can significantly boost average order values, particularly in categories like snacks and personal care products. Also, quick commerce allows FMCG companies to reduce reliance on traditional retail channels, streamlining their supply chains and potentially increasing profit margins by eliminating intermediaries,” Singh explains.

Expansion of dark stores

A strong network of dark stores (which is a retail distribution centre for online orders) is essential for quick commerce players, especially to increase its market share. Quick commerce companies are raising money to invest in dark stores. In just six months, Zepto announced three fundraising rounds and in the latest round, it raised $350 million.

Quick commerce logistics enabler Blitz recently raised Rs 40 crore in Series A funding led by IvyCap Ventures to enhance its 60-minute delivery infrastructure and expand its dark store network across the country’s top 20 cities.

Yash Sharma, Co-founder of Blitz told TNIE that Blitz is committed to empowering marketplaces and brands with 60-minute delivery capabilities, setting the stage for 10x growth in FY25. “Quick commerce in India is currently a $3 billion market, representing just 5% of the total e-commerce space. Having grown 3x in the past two years, it is projected to become a $30 billion industry within five years,” he said.

Talking about various challenges, he said many brands lack the infrastructure to enable quick commerce on their platforms, resulting in lost sales. Nearly 30% of customers abandon carts due to slow delivery timelines, highlighting a critical gap.

Vikram Gupta, Founder and Managing Partner, IvyCap Ventures, pointed out that they are seeing opportunities in this space as the market is expected to grow significantly reaching an estimated $5.5 billion by 2025, according to industry reports.

“While the growth prospects are promising, the sector faces challenges such as optimizing unit economics, building efficient last-mile infrastructure, and managing operational sustainability at scale. Addressing these challenges requires a combination of technology, innovation, and disciplined execution,” he said.

Delivery charges, a concern

Since quick deliveries require a significant logistics network that also include dark stores and delivery personnel, delivery charges are varying now across platforms depending on the order value.

“For orders valued at less than Rs 50, delivery fees often range from Rs 10 to Rs 50, depending on the platform and location. This pricing structure poses a challenge for both consumers and companies.

Naturally, high delivery fees on low-value orders can deter customers from making purchases, thereby impacting sales volume,” said Somdutta Singh.

Yash Sharma of Blitz said consumers are increasingly valuing the convenience of quick commerce, with 70% of escalations today related to urgent delivery requests. Blitz charges Rs 75 per order, 20% higher than standard same-day or next-day deliveries. “This reflects the slight premium which consumers are willing to pay for faster fulfilment,” he said.