Where Ultrafast Delivery Still Zooms
Bloomberg Businessweek US|June 27, 2022
India’s so-called quick commerce is soaring, but high cash burn may clip the startups’ wings
By Saritha Rai, with Chris Kay
Where Ultrafast Delivery Still Zooms

A new TV commercial in India features white-clad mourners grieving at the funeral rites of a departed loved one. The object of their grief is a refrigerator. “Ab fridge ka kya kaam hai?”—or “What use is a refrigerator?”—ask matching full-page ads for the campaign touting instant grocery brand Dunzo, which offers delivery of fresh items in minutes.

India is fast emerging as a global leader in a new type of online retailing: quick commerce. Big investors including Google, Reliance Industries, and SoftBank Group have poured billions of dollars into startups promising to bring that next order of curry-ready chicken, cat food, or crunchy aloo bhujia chickpea snacks within minutes, rather than hours or days. Relying on discounts and free delivery to woo customers who make purchases through mobile apps, the companies fill orders at neighborhood warehouses called dark stores, then use algorithms to send drivers on the fastest routes through the crowded roads of Delhi, Mumbai, Bengaluru (formerly known as Bangalore), and other cities.

Although groceries sold online account for just 2% of all grocery retail sales in India, they’re one of the fastest-growing segments of commerce and are considered essential for anyone dreaming of dominating e-commerce. And in a country where food and daily necessities— categories tailor-made for get-it-now delivery—make up about two-thirds of the $1 trillion in annual retail spending, startups are wagering that quick commerce can change grocery shopping habits and make them rich in the process.

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