Flipkart, India’s leading e-commerce platform, is preparing to enter the fast-growing quick commerce segment, where customers can get their orders delivered within 10 to 15 minutes of placing them. The company is reportedly building a network of dark stores across several cities to offer a wide range of products, from grocery and essentials to electronics and fashion, with speed and convenience.
What is quick commerce and why is it important?
Quick commerce is a new form of e-commerce that promises to deliver products to customers within minutes of ordering them online. It is enabled by hyperlocal logistics, cloud kitchens, and dark stores, which are small warehouses that stock inventory for online orders only.
Quick commerce is important because it caters to the rising demand for convenience, variety, and immediacy among urban consumers, especially in the post-pandemic era. It also helps e-commerce players to increase customer loyalty, retention, and frequency of purchases, as well as to reduce delivery costs and returns.
According to a 2022 report by Redseer, the total addressable market for quick commerce in India is nearly worth $45 billion, and it is expected to grow at a compound annual growth rate of 40% over the next five years.
How is Flipkart planning to compete in quick commerce?
Flipkart, which is majority-owned by Walmart, has been investing heavily in its supply chain infrastructure over the years, with a focus on reducing delivery times for grocery items. It has also launched same-day delivery in 20 cities, covering mobiles, essential items, electronics, home appliances, fashion, books, and lifestyle products.
However, the company is now eyeing the quick commerce segment, which is dominated by players such as Zepto, Blinkit, and Swiggy Instamart. These players have been expanding and diversifying their offerings, venturing beyond grocery delivery to include a range of items, from daily essentials to electronic gadgets.
According to sources cited by Entrackr, Flipkart will launch 10-15 minutes delivery in at least a dozen cities in the next six to eight weeks. It is building up a chain of dark stores across several cities, including Bengaluru, Delhi (NCR), and Hyderabad, among others.
Flipkart will have a wider catalog than the incumbents, with a sharp focus on FMCG, grocery, and daily essentials, but it will also push categories such as electronics, fashion, and others, the sources added.
What are the challenges and opportunities for Flipkart in quick commerce?
Flipkart’s foray into quick commerce comes at a time when the sector is heating up with competition and innovation. The company will have to face several challenges, such as:
- Building a reliable and scalable logistics network that can handle high volumes and short delivery windows
- Managing inventory and demand across multiple categories and locations
- Offering competitive pricing and discounts to attract and retain customers
- Ensuring quality and safety of products, especially perishable items
- Complying with regulatory and environmental norms and standards
On the other hand, Flipkart also has some advantages and opportunities, such as:
- Leveraging its existing customer base, brand recognition, and trust
- Utilizing its data and analytics capabilities to understand customer preferences and behavior
- Offering a seamless and integrated shopping experience across its platforms and services
- Cross-selling and upselling products and services to increase basket size and value
- Partnering with local merchants and suppliers to source and deliver products
Flipkart’s entry into quick commerce is likely to intensify the competition and innovation in the sector, as well as to expand the market and customer base. It will also test the resilience and differentiation of the existing players, who will have to keep up with the changing customer expectations and demands.
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