Quick commerce has been the talk of the town for the last few weeks as many companies are going all out to expand their ventures into the segment and tap its growing potential.
Since it is a convenience-based business, whoever starts to offer faster delivery with the right assortment can still take away the market share
Quick commerce has been the talk of the town for the last few weeks as many companies are going all out to expand their ventures into the segment and tap its growing potential.
As per an exclusive by the Economic Times, all the e-commerce and food delivery forums have started venturing into quick commerce with their own vertical and there is a rush to open dark stores and to expand infrastructure and supply chain. There is heavy competition to get the right sites to set up micro warehouses for servicing nearby localities.
BigBasket, Zepto, Flipkart Minutes and Swiggy Instamart are recruiting aggressively, as well as poaching as per the ET report.
Acquiring dark stores is essential for daily operations to deliver orders within 15-30 minutes.
A report by BofA Securities said that all the major commerce platforms are in a land-grab mode as they look to double their dark store count in the coming years. It stated that rents for commercial spaces in central locations are higher than warehouses operating outside the city limit by e-commerce companies such as Amazon and Flipkart.
Zepto closed a $1 billion round last week and said finding real estate dark stores in densely populated areas of large cities is challenging, but not in the newer (tier II-III) markets.
Zepto's competitor, Zomato, which owns Blinkit, has reportedly started expanding into smaller places such as Bathinda in Punjab, Haridwar in Uttarakhand and Vijayawada in Andhra Pradesh over the last few weeks.
As per the BofA securities report, quick commerce platforms are rampantly increasing their stock-keeping units, or different items at the dark stores to 10,000 and even 25,000, from 4000-5000.
It is a convenience-based business, so whoever starts to offer faster delivery with the right assortment can still take away market share, the report said.
The report stated that the consumers are generally sticky, and end up using one to two platforms to meet their different needs. It is only when they face bad service that they switch and that is the reason why many are going for a larger number of dark stores and going after densification.
An emphasis on the need for people to figure out the logistics and move goods as it is quick commerce is an operation-heavy business and that is the reason why it was e-commerce firms took a longer time to enter the fast delivery segment.
Flipkart, with its quick commerce vertical, 'Minutes', has hired many roles for the company.
Tata-owned BigBasket has also moved into a fully quick-delivery model. It is reported that it will retain its warehouses– 60 of them– to be able to carry certain large appliances and high-value products.
IPO-bound Swiggy recently roped in Flipkart's senior vice-president Amitesh Jha as Instamart's chief executive.
Poaching is reportedly happening across all the commerce firms across all levels including marketing, operations, supply chain management and finance, as per a Gurgaon-based quick commerce, reported ET.
Industry executives reportedly said Zepto has been aggressively hiring folks from companies such as Amazon, Flipkart, Zomato, Swiggy, Ola and Urban company.
It is said that several people from marketing and brand roles have joined Zepto with category management and inventory management personnel joining companies such as Amazon, Flipkart and Meesho.