India's quick commerce sector made two-thirds of all 2024 e-grocery orders, report says

(Reuters) - India’s quick commerce sector accounted for over two-thirds of all e-grocery orders last year, with its total market share growing about five times to $6-7 billion from 2022, a report by consultancy firm Bain and e-commerce giant Flipkart showed.  

 

The industry, which is dominated by the likes of Zomato-owned Blinkit, also accounted for a tenth of overall e-retail dollars spent in 2024, according to the report released on Wednesday.

 

These platforms deliver groceries to electronics within minutes, and its market share is expected to grow over 40% annually till 2030, driven by expansion across new categories, geographies and consumer segments, according to the report.

 

"The dramatic rise of quick commerce (i.e., delivery in less than 30 minutes) has been one of the most defining hallmarks of India’s e-retail market over the last two years," according to the report, which stated that the sector had over 20 million annual online shoppers and employed over 400,000 people.

 

However, these platforms could face some immediate challenges in expanding profitability, as they may struggle to grow into markets beyond large cities and also face stiff competition from larger e-commerce players including Flipkart.

 

To sustain profitable growth, "companies must adapt their business models for markets beyond major metros, manage rising competition, and optimize supply chains", it said.

 

The report comes at a time when players such as Flipkart Minutes, Myntra’s M-now, BigBasket’s BB Now, and Amazon’s Tez have forayed into the sector with their respective quick commerce platforms.

 

However, some industry experts expect this boom to be short lived.

 

Last month, a Blume Ventures’ report said that the sector may struggle to maintain its current pace of growth. 

 

TVS Capital Funds Chairman Gopal Srinivasan told Reuters in an interview that the quick-commerce frenzy is a "passing fad" and unsustainable in the long run.

 

(Reporting by Ashwin Manikandan; Editing by Rashmi Aich)