Quick commerce has taken India’s e-grocery landscape by storm. According to a recent Bain & Company report, quick commerce now accounts for 70-75% of total e-grocery orders, marking a dramatic surge from just 35% in 2022. This rapid ascent has been fueled by robust execution, rising incomes, an expanded product range, and the ever-growing demand for convenience. Yet, as the sector skyrockets, questions loom about its long-term sustainability.
A New Era of Convenience
The quick commerce boom is reshaping consumer behavior, with major players like Blinkit, Zepto, and Swiggy Instamart racing to capture market share. Even traditional e-commerce giants like Flipkart and Amazon have jumped into the fray with Flipkart Minutes and Amazon Tez, signaling the importance of speed in today’s digital economy. Incumbents that relied on scheduled delivery, like BigBasket, are turning to quick commerce as well.
At the heart of this transformation lies the optimization of logistics. Companies are setting up ‘back’ dark stores in high-demand areas, connected to multiple ‘forward’ dark stores. These hubs stock premium and high-value items, broadening their product offerings and catering to an increasingly diverse customer base.
Powering Direct-to-Consumer Growth
For D2C brands, quick commerce platforms have emerged as a strategic sales channel, offering hyper-targeted marketing and increased market reach. Many startups are now dedicating budgets specifically to quick commerce, leveraging the platform to enhance visibility and drive sales.
Profitability in Focus
Interestingly, profitability in the quick commerce segment is on the rise. The Bain report highlights that a 40% rise in average order value (AOV) between FY23 and FY25, driven by an expanded product mix and higher free delivery thresholds, is contributing to this upward trajectory. Additionally, the inclusion of high-margin products and new revenue streams like advertising have improved gross margins by 3-4 percentage points.
Operational efficiency is another key driver. More dark stores are now processing over 1,000 orders per day, leading to better cost management. Logistical densification has also reduced per-shipment costs by 25% in 2024 compared to 2023.
Cracks in the Foundation?
However, not everyone is convinced that this meteoric rise is sustainable. According to Blume Ventures’ Indus Valley 2025 report, quick commerce may soon face significant hurdles. Chief among them is the limited total addressable market (TAM) in India due to low per capita income.
The report points out that India’s affluent consumer base – dubbed “India1” – isn’t growing fast enough to support continued explosive growth. While monthly transacting users (MTUs) are expected to rise from 26 million today to 128 million by FY31, this projection assumes an aggressive expansion that may not be realistic.
“Much of India’s consumption is led by India1, and within that, there is a subset we call India1 Alpha, which is about 8-10 million households large who are true super consumers. This class is growing slowly,” the report notes. “The growth in MTUs will thus attract marginal users, not power users, making it challenging to more than double orders.”
Challenges of Dark Store Expansion
Another potential roadblock lies in the expansion of dark stores. Quick commerce firms have aggressively scaled their dark store networks to enable faster deliveries, but sustaining this growth may prove difficult. The Blume report suggests that only 965 of India’s 19,300 pincodes are affluent enough to support dark stores, casting doubt on current projections that estimate 11,150 dark stores by FY31.
“A proxy for affluence is the presence of over five organized retail stores, which is seen in only five percent of India’s pincodes. These pincodes serve 11% of the population,” the report explains.
Rising Competitive Intensity
Adding to the pressure, traditional e-commerce giants have intensified their focus on faster deliveries. As Flipkart Minutes and Amazon Tez expand their footprints, quick commerce players may find themselves fighting harder for market share.
Moreover, the specter of overexpansion looms large. Dunzo’s aggressive push into quick commerce with Dunzo Daily serves as a cautionary tale. The Bengaluru-based startup’s rapid expansion led to unsustainable cash burn and mounting losses, ultimately forcing layoffs and founder exits.
What’s Next?
Despite the challenges, quick commerce remains a nascent market with tremendous potential. The Bain report projects a staggering growth from $7.1 billion in FY25 to $89 billion by FY31. Legacy FMCG and D2C brands are increasingly seeing quick commerce as their highest-volume digital sales channel.
Yet, the path forward will require a balance of ambition and caution. Companies must focus on optimizing operations, enhancing profitability, and avoiding the pitfalls of overexpansion. The next phase of quick commerce will likely be defined by those who can innovate while maintaining a sharp eye on sustainable growth.
Quick commerce has undoubtedly changed the rules of the game. Whether it will cement itself as the future of retail or become a cautionary tale of unsustainable growth remains to be seen. One thing is certain: the race is on, and only the most agile will thrive.
