Updated March 11th, 2024 at 11:15 IST

Flipkart set for quick commerce comeback amid growing market dynamics: Report

Blinkit (formerly Zomato), the dominant player in the QC market, commands a notable market share of around 46%.

Reported by: Tanmay Tiwary
Flipkart | Image:Pixabay
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Flipkart set for QC return: E-commerce giant Flipkart is gearing up for a re-entry into the Quick Commerce (QC) segment within the next 6-8 weeks, as per recent media reports.

The move follows the company's contemplation of acquiring Dunzo, a Reliance-backed entity, signalling Flipkart's strategic pivot towards the burgeoning QC landscape, analysts at brokerage firm JM Financial noted.

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The decision aligns with the shifting dynamics in the e-commerce arena, where incumbent players are venturing beyond daily essentials into diversified categories. 

These developments underscore the imperative for large e-commerce platforms to reassess their market strategies and consider strategic acquisitions to stay competitive.

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While Flipkart's potential re-entry into QC holds promise, several factors warrant consideration. The execution-heavy nature of the QC business, coupled with Flipkart's previous lack of intent in this space and recent cost-cutting endeavours, may temper its aggressiveness, the brokerage firm said in a note.

Nonetheless, media reports indicate Flipkart's proactive steps in ramping up infrastructure to enable 10-15 minute deliveries across multiple cities. The establishment of dark stores in key metropolitan areas like Bengaluru, Delhi NCR, and Hyderabad reflects Flipkart's commitment to meeting evolving consumer demands for speed and convenience.

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In its third attempt at QC, Flipkart's success will hinge on its ability to address key challenges, including finding a strong product-market fit, solving the intricacies of hyperlocal delivery, optimising technology and supply chain logistics, and creating a distinct brand identity for QC offerings.

Meanwhile, Blinkit (formerly Zomato), the dominant player in the QC market, commands a notable market share of around 46 per cent. 

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With a robust balance sheet and profitable food delivery segment, Blinkit appears well-positioned to withstand competitive pressures, JM Financial asserted. Other players like Zepto and Swiggy-owned Instamart also exhibit resilience with strong financial standings and promising growth trajectories.

Despite Flipkart's re-entry, the QC market presents substantial growth opportunities, with Redseer estimating a serviceable Total Addressable Market (TAM) of approximately $45 billion for QC in calendar year 2021 (CY21). 

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Meanwhile, Deloitte projects the QC market to expand to $40 billion by calendar year (CY30), indicating ample room for 3-4 players to thrive in an oligopolistic market structure.

As Flipkart prepares to reassert its presence in the QC landscape, the industry anticipates intensified competition and innovation, ultimately reshaping the dynamics of India's eCommerce ecosystem.

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Published March 11th, 2024 at 11:08 IST