Flipkart's q-commerce entry weeks away, will take on Zepto, Blinkit, Instamart

“It'll be a few weeks from now; we'll start in a few large cities and progress as we move forward," Hemant Badri, senior vice president, head of supply chain, customer experience and recommerce business, Flipkart Group, said in an interview. 

Adding that Flipkart would play to its strengths—wide variety of choices, knowledge of consumer shopping habits and the presence of a large platform—Badri said the customer proposition for quick commerce is “very strong", explaining the company’s rationale behind investing in the segment.

The company will offer a wide assortment of goods on quick commerce including home appliances, apart from focusing on key categories such as staples, munchies, fruits and vegetables.

Also read | Flipkart has FOMO? Zepto and Blinkit are changing the e-commerce giant

“The convenience offered by quick commerce has resonated well with urban users whose average order value is a sizable at ₹450-600, with product basket encompassing even electronics, stationery, gifting, festive products and beyond," analysts at Jefferies said in a March report. "Brands are also enthused given the rapid scale-up of the channel."

Badri declined to share investment numbers behind the company's entry into quick-commerce. 

"We have built the supply chain, we are also riding on the existing supply chain," said Badri, who was given responsibility of Flipkart's quick-commerce business in the June quarter. “We don't want to be one more me-too in this space, and we will leverage all our strength from supply chain to customers to our ability to understand demand and trends."  

The competitive landscape

Flipkart’s entry is set to up the ante within the quick-commerce market, which, according to consulting firm Redseer, grew 77% year-on-year in 2023 to reach $2.8 billion in gross merchandise value (GMV); currently, it is pegged at 5% of India’s e-commerce.

This jump in the market has been driven by companies like Zepto, Zomato-backed Blinkit, Dunzo, and Swiggy Instamart. Orders have climbed for these players in the past year on the back of greater convenience and availability of a wide assortment of goods.

Also read | Zepto eyes large orders with dark store expansion 

For instance, in financial year 2023-24, Blinkit’s gross order value stood at ₹12,469 crore, and adjusted revenue stood at ₹2,302 crore last fiscal, parent Zomato said in its March quarter earnings.

Preparing for the ‘quick’ jump

This is yet another attempt from Flipkart at grocery delivery, albeit quick commerce is more than just grocery now. For instance, it earlier launched Flipkart Quick—delivering only fruits and vegetables within 25-20 mins. However, that business was subsequently scaled down.

In January, Flipkart announced the roll-out of same-day delivery of products across multiple categories in 20 cities in India. Customers get their products delivered before 12 midnight, if they place their orders by 1 pm. The initiative will be scaled over the next several months to serve more customers across the country, the company said when announcing the roll-out.

Flipkart's quick-commerce venture will further propel the company’s ability to service consumers fast—a key demand for Indian customers today. Commenting on how the company will deliver goods in a short span of time, Badri said the retailer will look at “every possible" go-to market strategy.

Also read | Rise of tier-II online shoppers. Can they change Indian e-commerce?

“We have large fulfillment centres and logistics network. So, we are very strong on these. We also had our own learning of having dark store operations, so we are reasonably confident that we will build the right network—it’s about supply chain solutions and catering to our customer needs. We are using the existing network and some part is getting built," he added.

On whether Flipkart will service orders via small mom-n-pop stores, Badri said, “We want to democratize commerce, so we are exploring all options."

The Flipkart Group operates Flipkart, Myntra, Flipkart Wholesale, Flipkart Health+, and Cleartrip in India.

While quick commerce started on the premise of top-up purchase, it now offers a wide product assortment and has gone way beyond grocery. Grocery, the anchor category for quick commerce, is estimated to be a $600-billion market (including both offline and online), according to the Jefferies report.