Will q-commerce change the Indian food delivery system?
As India’s quick-commerce market continues to flourish with a focus on delivering groceries and consumer goods in record time, e-commerce players are now setting their sights on changing the food delivery sector.
The idea of integrating quick-commerce (q-commerce) principles into food delivery is undoubtedly appealing to consumers who value speed and convenience. However, while this concept is enticing on paper, its practical execution may present a multitude of challenges.
Burgeoning food delivery market
“The Indian food delivery space is highly competitive, with Swiggy and Zomato dominating consumers’ minds,” said Francis Gabriel Godad, consumer business development manager at GlobalData India. “These established players have strong partnerships with restaurants and cloud kitchens and attract consumers with regular discounts and promotions.”
India’s online food delivery market is poised for significant growth, with projections indicating it will reach Rs 2.12 trillion (US$25.3 billion) by 2030. The sector represents 20 per cent of the overall food services market, growing at a compound annual growth rate (CAGR) of 18 per cent over the next six years, according to a study by Bain & Company and Swiggy.
Neralla Rama Ravi Teja, consumer analyst at GlobalData, said factors such as busy lifestyles, longer travel times due to traffic, convenience of food delivery, and the desire to avoid heat, pollution, and large crowds have contributed to the growth of the q-commerce trend.
“The Covid-19 pandemic amplified consumers’ tendency to order food online,” Teja said. “However, given the increasing traffic and the wide selection of food service outlets, food delivery times are increasing.”
Meeting demand
To meet the rising demand for quicker delivery times among customers, Zomato started a quick delivery model for select foods with a limited menu. Meanwhile, Bengaluru-based start-up Swish launched a new food delivery platform that aims to bring the agility and rapid turnaround times of q-commerce to the food delivery space, promising delivery times of between 10 and 15 minutes.
“To carve out a space for itself in this competitive landscape, Swish needed a radical proposition,” Godad said. “It expects its 10-minute delivery to help it rapidly penetrate the Indian market.”
“Swish draws inspiration from the growing consumer acceptance of q-commerce providers, such as Blinkit and Zepto, with a similar proposition of grocery delivery within a few minutes. In June, Zepto announced raising a funding of $665 million, which underscored investors’ belief in the company’s value proposition and the consumers’ affinity for q-commerce.”
However, the launch of Swish has sparked debates regarding labour exploitation and freshness. The complexities involved in maintaining food quality during rapid transit, managing a diverse range of restaurant partnerships, and ensuring consistent delivery speeds across various cuisines and preparation times are just a few of the hurdles that these companies might face.
Additionally, the operational and logistical demands of combining quick commerce with food delivery could prove to be a significant undertaking, requiring careful planning and substantial resources.
“Cooked food needs preparation time to meet individual consumer preferences,” Godad said. “The preparation of some items can start from scratch only after receiving an order. Q-commerce delivery may struggle to address consumers’ concerns over the quality of food that is made and delivered within 10 minutes.”
“Some consumers are sceptical about restaurants using stale, pre-cooked food items, and not following proper procedures. In addition, there are concerns over the safety of delivery personnel, who may resort to rash driving to deliver food quickly, resulting in accidents and threatening their lives.”
While speed is undoubtedly attractive to consumers, it should not come at the cost of food quality, worker safety, or ethical business practices. As the sector evolves, companies will need to find innovative solutions that address these challenges while still meeting the growing demand for faster delivery times.
The post Will q-commerce change the Indian food delivery system? appeared first on Inside Retail Australia.