In the wake of the coronavirus crisis, e-commerce on-demand and instant delivery emerged as one of the most sought-after logistics services globally. Placing immediacy at the forefront, q-commerce or quick commerce offers to deliver small orders in the shortest possible time, usually in less than an hour or as fast as ten minutes. To meet these delivery times, retailers in the sector rely on online ordering systems, fulfillment hubs – commonly known as "cloud stores" or "dark stores" – placed strategically in densely populated areas, and a two-wheeled delivery team.
A phenomenon echoed worldwide
Whether to replenish a couple of essentials that ran out, buy missing ingredients for dinner, or indulge in a spontaneous treat, quick commerce aims to complement, rather than replace, grocery shopping. The concept has gained rapid traction in all corners of the world, with over a third of global digital shoppers using q-commerce services in 2021.That year, the streets of some major European and American cities saw a wave of riders carrying delivery backpacks from competing brands in the sector. In the United States, Gopuff, JOKR, and Buyk are among the players revolutionizing home delivery. From across the ocean, startups Gorillas and Flink stole the spotlight in Germany. Founded in 2020 amid the pandemic, both companies secured billions of dollars in funding in just a few months. Similarly, British-based Jiffy and Dija, launched in November that year, and Cajoo, operating in France since early 2021, also received significant investments in record time.
Innovation and interest in ultra-fast delivery are not limited to Western markets. Born in Turkey in 2015, Getir has positioned itself as one of the most relevant quick commerce brands. Expanding across Europe and the United States in recent years, the company acquired startups Weezy (UK), BLOK (Spain), and Moov (U.S.) in 2021. Looking at the market size of q-commerce in the Middle East and North Africa region, projections suggest twofold growth from nine billion U.S. dollars in 2020 to about 20 billion dollars in 2024. Meanwhile, the value of quick commerce sales in India is set to expand nearly fivefold between 2020 and 2025.
A challenging road ahead?
Quick commerce has enjoyed growing popularity and demand for this type of service is likely to keep rising, but it might take some time for companies in the sector to become profitable. According to a 2021 study, European startups focused on near-instant delivery would need to quadruple the volume and, simultaneously, double the value of daily orders if they want to create profit. Not yet a given, various players have alternatively resorted to introducing a delivery fee. However, this solution may prove counterproductive. As a survey revealed, delivery fees constitute the main barrier to online grocery shopping in the United States.Although the supply chain disruption from the coronavirus paved the way for these companies to flourish, it also brought about challenges related to management and distribution processes. Increasing demand for faster delivery and larger order volumes, coupled with labor shortages, are the biggest ones. Such a pace also poses several risks to riders. In the UK, up to three quarters of drivers and riders surveyed said they had taken action to avoid an accident while on the job. In addition, 47 percent stated that time pressure could cause them to travel above the speed limit, while 30 percent went so far as to jump traffic lights for this reason.
Road congestion has led to mounting discontent among city residents and administrations. For instance, in January 2022, the tense situation led various cities in the Netherlands to ban any new dark stores in densely populated residential areas. This move could mark the beginning of stricter regulations to come for quick commerce startups in Europe and the world.
