India’s quick commerce market is experiencing a boom, with demand more than doubling for some players. However, the aggressive push for fast deliveries by Flipkart and Amazon is intensifying competition in an already crowded space where profitability remains under pressure.
Flipkart, a major Indian e-commerce player, entered the quick commerce sector later than rivals like Blinkit, Swiggy, and Zepto. This week, the company has surpassed 800 dark stores (distribution centers for online shopping) and plans to double this number by the end of 2026, according to UBS.
This expansion occurs as India’s quick-commerce sector enters a more competitive phase. Recent events include the departure of a co-founder at Swiggy and a general reassessment of strategies by companies due to rising competition and costs.
Walmart-owned Flipkart launched its quick commerce service, Flipkart Minutes, in August 2024, offering deliveries across various categories in as little as 10 minutes. Since then, the sector has grown rapidly. Bernstein reported that over 6,000 dark stores are now operational, leading to significant overlap among players in major cities and heightened competition.
Beyond Major Cities
Flipkart’s dark store network in India is smaller than that of market leader Blinkit, which operates over 2,200 dark stores, according to Bernstein. However, Flipkart is focusing on expanding beyond major cities to drive growth. This contrasts with Blinkit, which aims to reach 3,000 dark stores by 2027, concentrating on its top 10 cities.
Satish Meena, founder of Datum Intelligence, a consumer insights firm based in Gurugram, stated, “Flipkart has this Walmart DNA. Walmart’s DNA is always about expanding the total addressable opportunity to dominate by expanding the market.”
Flipkart is already observing growth beyond major cities, with 25% to 30% of its quick-commerce orders originating from smaller towns, according to a source familiar with the matter. The source also indicated that orders per dark store have increased by approximately 25% month-on-month.
Despite this, growth in quick commerce remains concentrated in larger cities. Bernstein noted that most demand is still driven by big cities, where higher population density supports faster deliveries and better utilization of dark stores, even as expansion into smaller towns accelerates.
This dynamic also impacts profitability. Bernstein reported that the top eight cities in India host over 3,800 dark stores operated by the five largest players, with about 3,600 having the potential to be profitable.
Karan Taurani, executive vice president at Elara Capital, a London-headquartered investment bank, commented, “Metro markets obviously are better in return ratios, better in profitability because of higher throughput. This business is all about higher throughput, and for now, that is coming largely from metro markets.”
However, some analysts foresee a long-term opportunity beyond major cities. Meena suggested, “Non-metros (small towns) can give a surge if companies expand beyond groceries and offer a wider range of items at faster speeds. Flipkart is betting on that.”
Nevertheless, scaling beyond big cities will require time. Aditya Soman, a senior research analyst at CLSA, a Hong Kong-based brokerage, stated that quick commerce is currently viable in about 125 cities, and dark stores typically take six to 12 months to reach maturity and profitability. He added that many of the newer stores in smaller towns are still in the ramp-up phase.
Amazon, which entered India’s quick-commerce market in late 2024 shortly after Flipkart, is also increasing its presence. According to UBS, the e-commerce giant has launched approximately 450 to 500 dark stores, with about 330 to 370 currently operational, as it aims to capitalize on the growing demand for faster deliveries.
Pressure Mounting on Incumbents
Flipkart is competing not only through dark store expansion but also via aggressive pricing. The company is offering significant discounts, around 23% to 24% across categories based on a sample basket analyzed by Jefferies last month, to attract users in a market where price and convenience are key demand drivers.
These strategies appear to be effective. JM Financial recently warned that Swiggy’s quick-commerce business is facing a “growth-versus-profitability deadlock” and risks diminishing shareholder value, suggesting that a takeover by a larger, better-capitalized entity might be the optimal outcome for investors.
Shares of Eternal, the owner of Blinkit, have declined by approximately 15% this year, while Swiggy has seen a drop of over 29%. Meanwhile, Zepto is preparing for an initial public offering (IPO) on Indian stock exchanges later this year.
The entry and expansion of major players like Flipkart and Amazon are reshaping the competitive landscape. Ankur Bisen, a senior partner at retail consultancy Technopak Advisors, commented, “Quick commerce is no longer in a startup phase — it has become a big players’ game.”
He further noted that the sector’s economics and limited differentiation could eventually lead to consolidation, as companies vie for the same customer base in a discount-driven market.
Amazon, Flipkart, and Swiggy did not respond to requests for comment. Eternal declined to comment, while Zepto stated it could not comment due to a silent period following its IPO filing.
