Explained: The q-commerce model, how your order is delivered in minutes

“And we will no longer be doing this as Grofers — we will be doing it as Blinkit,” the company’s CEO Albinder Dhindsa wrote in a blog post.

After losing significant market share to BigBasket over the years, Softbank-backed Grofers decided to change its business model from the conventional grocer model to the quick-commerce model, in which goods are delivered in a much shorter time.

Several other online delivery platforms too have entered this high-volume business. Dhindsa wrote in the blog post that Grofers is processing more than a million orders every week across 12 cities in India.

So how does the q-commerce model work?

The supply chain disruptions triggered by the Covid-19 pandemic led to the emergence of a new sub-vertical in the online grocery segment — quick commerce, or q-commerce — the unique selling proposition of which was the promise of delivery within 10-30 minutes of ordering.

The focus of most of these ventures is on setting up micro-warehouses located closer to the point of delivery, and of restricting stocks at these “dark stores” to a focussed set of under 2,000 high-demand items, as against the traditional formula of well-stocked, large-format warehouses that are located on the outskirts of towns and cities.

Who are the other players in this segment?

New players, including Mumbai-based Zepto, have waded into a space where industry heavyweights — Grofers, Swiggy, and Dunzo, alongside Tata Group-owned Big Basket that will be extended to the Tata Neu superapp — have either launched or are contemplating full-scale operations.

Earlier this month, food-tech platform Swiggy announced it will make a $700 million investment into its quick-commerce vertical Instamart. Swiggy said that by January 2022, it will make deliveries in 15 minutes through a network of dark stores located very close to the bulk of its customers.

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