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August 18, 2025
Hiral Goyal, The Morning Context
18 August 2025
A trend that has been playing out through big and small changes over the last two decades is that in urban India the kirana store is easily replaceable.
When it comes to buying groceries, urban Indians have a number of options. They can visit a fancy supermarket run by a conglomerate or order online through a number of e-commerce and instant-delivery companies. And if the above doesn’t seem easy enough, they can hop over to a nearby mom-and-pop store.
It would appear it is now the turn of smaller towns in the country to witness the kirana disruption. Even though 99% of grocery shopping in these tier-3 cities is done through neighborhood general stores, there are startups that believe this is an outdated and inefficient form of retail and a change is in order.
One such company is SuperK. The startup’s mission is to build a grocery store model in small towns that has all of the advantages of modern retail packed in a compact 800-square-foot store. This is what Anil Thontepu and Neeraj Menta had set out to do when they founded the company in 2019. The idea was to bring a modern trade-like grocery shopping experience to small-town India a wide assortment of products at a better value.
“There is a cost-efficient world of general trade and a customer-loving world of modern retail,” says Thontepu. “We wanted to see if we can bridge this gap…and do something for the small-town people by bringing the best of both these worlds.”
Over the past five years, the Bengaluru-headquartered startup has opened over 130 stores across 80 towns in Andhra Pradesh. And it doesn’t want to stop there. The company wants to expand to another 300 towns in Andhra Pradesh and nearby states of Karnataka and Telangana over the next 24, months. That’s quite an ambitious target. But the founders believe the market size for Superk is so large that they should be able to build a Rs 2,000-3,000 стоore ($228-342 million) annual business from Andhra and Telangana alone.
To fuel this expansion, Superk raised Rs 100 crore ($11.7 million) in Series B funding last month. The round, led by Binny Bansal’s 3STATE Ventures and CaratLane founder Mithun Sacheti, valued Superk at 2-2.5x its previous valuation of Rs 160 crore (about $18.25 million) in 202/
Now, Superk is not entirely unique. It competes with startups like Frendy, Apna Mart and Wheelocity, which are also trying to organize the retail market in India’s smaller towns. What sets SuperK apart is its larger, bolder approach. Grocery chain Apna Mart, for instance, runs franchisee stores in tier-2 or tier-3 markets and also offers 15-minute home delivery, SuperK’s focus is only on supermarkets. Frendy operates mini-marts and micro-kiranas in villages and towns with fewer than 10,000 people, but SuperK targets small towns with populations between 20,000 and 500,000. And Wheelocity supplies only fresh produce to rural areas, while Superk sells dry groceries as well as packaged consumer goods.
This rather radical shift in focus-away from tier-1 and tier-2 cities-ties in with India’s changing consumption pattern. “Consumer mindsets are changing even in smaller cities,” says Devangshu Dutta, founder and chief executive of Third Eyesight, adding that these consumers are beginning to favour more modern retail environments. And NielsenIQ’s latest report says rural markets in India grew twice as fast as cities between April and June 2025.
In this landscape, SuperK fits like a glove, with its franchise-first approach. Thanks to an asset-light model, the company has the agility to go deeper into smaller towns.
But it won’t be all that easy either. As Dutta says, “Changing grocery habits is a long, capital-intensive game.” Moreover, big retail chains are also jumping on the bandwagon. Hypermarket chain Vishal Mega Mart, for instance, already operates 47% of its stores in tier-3 cities and plans to expand into cities with populations exceeding 50,000. Supermarket chain operator DMart is also focusing on tier-2 and tier-3 cities.
However, Superk founders believe they are prepared for the challenge. Menta says the startup has arrived at a business model that is scalable, sustainable and, more importantly, offers value to its customers.
It’s too early to say whether they will be successful in this endeavour. That said, SuperK appears to have built a smart retail business for small-town India.
Refining small-town retail
SuperK’s founders have drawn inspiration from domestic and international retail chains like DMart and Costco. But they haven’t duplicated their strategies and made their own tweaks instead. For instance, large retail chains usually run company-owned and company operated, or COCO, stores. Though this approach is more cost-intensive than the franchise model, it allows a company to ensure a uniform customer experience across all outlets:
Superk doesn’t do that. It runs only franchise-owned and franchise-operated (FOFO) stores, which are no bigger than 800 sq ft. The company is not the first to have experimented with this model, but Thontepu believes that everyone else before them “did not try with the right spirit”. A franchise-owned store, argues co-founder Menta, is run differently from a company-owned store one has to keep in mind the store owner’s incentives, needs and concerns.
Under the franchise model, entrepreneurs invest between Rs 12 lakh (about $13,690) and Rs 15 lakh (about $17,110) to set up a Superk store. Of this, Rs 4 lakh (nearly $4,560) is spent on the store fit-out and infrastructure, the rest goes towards buying inventory. These stores, according to Menta, typically achieve a breakeven point after six months. On average, a retail store takes longer than that-12-15 months to reach breakeven.
Superk fills the shelves by procuring its inventory directly from brands as well as distributors. “The inventory is recommended by us through a mobile application. Store owners have an option to make certain changes within the limits that we have set for them,” says Thontepu. Revenue is shared and the model is similar to the one followed by nearly all retailers in India. Franchisees earn varying levels of margins on different kinds of products, depending on how easy or tough it is to sell those items. For instance, staples like dal and rice have lower margins, while confectionary items and products that need greater effort to sell enjoy higher margins of up to 20%.
In addition to this, there’s a private label business, especially loose items like pulses. In fact, private labelling is part of the company’s efforts to bring some standardization in India’s unorganized retail market. “A customer coming to our store should be able to blindly expect consistent quality on the product they’re buying,” says Menta. “We have organized our sourcing, processing, cleaning, packaging, testing. Everything that a brand would do to provide a great-quality product to their customer.”
Unlike distributors or other retailers who operate franchise models though, Superk claims that it does not dump its inventory on store owners. Menta says the franchise structure is designed in a way that Superk does not benefit from selling unnecessary stock to store owners. “If I lose, he will lose. If he loses, I lose. That is the way (the structure) is created. We, in fact, recommend owners to remove some products if they are not selling.” says Menta.
On the customer side of things, Superk’s value proposition comes down to offering the best prices. More than a year ago, for instance, it introduced a membership programme that offers customers cashback that is redeemable on their future purchases. “If they pay Rs 300 [approximately $3.5) for a six-month membership, they get 10% cashback on all purchases that they are making up to Rs 300 every month,” explains Thontepu. He says 35-40% of Superk’s more than 500,000 customers are enrolled in this programme.
All of this sounds good even promising in theory. But will it be enough to build a sustainable and scalable retail business?
A long, hard look
Let’s first look at what really works in SuperK’s favour.
One, the focus on selling staples under a private label brand. This has been done successfully before. One example is Nilgiri’s, one of India’s oldest supermarket chains.
Founded in 1905, Niligiri’s operated under a franchise model and sold dairy, baked goods, chocolates and other items produced under its own brand. The supermarket chain was sold by debt-ridden Future Group for Rs 67 crore ($7.65 million) in 2023, less than one-third the price the latter paid to acquire the company from private equity firm Actis in 2014. However, its history is worth learning from.
Shomik Mukherjee, a Delhi-based consumer goods advisor who was a partner at Actis while the firm was in control of Nilgiri’s, recalls the value proposition created by Nilgiri’s private label products. “In the case of private labels, it is essential for a company to have a reason why people will walk into that store. For Nilgiri’s, it was bakery and dairy products,” says Mukherjee. Owning a private label that brought in customers also ensured that franchisee owners had incentives to continue working with Nilgiri’s. “It is about giving the franchisees a safe portfolio of private label goods that are desired by customer instead of something that is shoved down the franchisees’ throat to derive margin,” he says.
You see, the overall grocery business operates on a very low margin. But private labelling, says Satish Meena, founder of Datum Intelligence, offers the highest margins – 35-40% – in the grocery business, after fresh produce, making it a lucrative business to get into.
Superk, which sells essential items through its private label, has the opportunity to earn better margins in grocery retail. More importantly, private labelling holds the potential to become SuperK’s identity and boost customer retention and loyalty.
Two, SuperK’s franchise model allows it to expand to more locations rapidly as compared to a regular modern trade chain with company-owned stores, says Mukherjee. This model makes SuperK’s business asset-light and brings down the cost of running a network of stores. “Under this model, the franchisor does not incur the upfront cost of opening a store or having to deal with the trouble of hiring and replacing store managers,” he adds. Since most store owners in a franchise model are landowners, there is a greater stability in operations as well, he explains. Moreover, Superk stores are quite small (800 sq ft), allowing easier availability of property.
The franchise model, however, is not entirely foolproof. One of the inherent problems is the difficulty in implementing standard operating procedures (SOPs) across all stores. And the problem only worsens as the company expands operations to different cities. While Superk stores boast a no-frills fit-out that can be easily set up anywhere, how these stores are maintained through the wear and tear over the years is yet to be seen.
A bigger fear is that the store owner may start running their own store without the Superk branding. “If Superk loses the franchisee owner, it also loses the location in which the store was operating,” says Mukherjee.
Moreover, most franchisee owners in the retail business typically tend to be experienced general store owners who might not be willing to adopt new technology. “Since they have run a store before, they think they know how and what to order for inventory and may not follow SuperK’s tech-enabled recommendations,” says Mukherjee.
There’s another problem. While the founders claim to have seen considerable success (35-40% sign-ups) in the rollout of SuperK’s membership programme for customers, Third Eyesight’s Dutta raises concerns about its future growth. “Indian consumers’ price sensitivity limits membership fee potential,” he says. According to him, the programme’s value in the tier-3 market lies more in customer acquisition and retention than direct revenue generation. “Long-term success requires a cashback programme to drive purchase frequency and basket size increases to offset the costs,” says Dutta.
Menta, however, has a different view. He says SuperK’s subscription is designed in a way that benefits customers only when they make full basket purchases. Moreover, the company has different pricing slabs for membership depending on the various basket sizes, which makes the model more viable. Considering the programme is a little more than a year old, it is still too early to judge whether it will find a lot of takers in small towns.
For now, the founders are in no hurry to expand their business across India. “There is no reason to go into five states. Then, you are spread thin and your economics will not work out. It’s a business of managing operations at a very low cost,” says Menta. The plan is to stick to one region and continue to go deeper into it. “A lot of our competitors who started five years ago spread to so many places that it became very difficult for them to manage,” he adds.
This is also the crux of how Thontepu and Menta are building SuperK. By implementing what they have learnt not only from their own experiments, but also from the failures and successes of other businesses. While there’s no guarantee that Superk will become a roaring success, it does appear to have set an example by starting small and growing patiently. And if the latest funding is any proof, investors are interested.
(With inputs from Neethi Lisa Rojan)
(Published in The Morning Context)
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August 6, 2025
Naini Thaker, Forbes India
Aug 06, 2025
It’s a known fact that of the thousands of startups founded each year, only a small fraction survive—and even fewer scale to become unicorns. Rarer still are those unicorns which, after reaching dizzying heights, come crashing down. The Good Glamm Group is one such cautionary tale.
Once celebrated as a unicorn that cracked the code on content-to-commerce, the company’s meteoric rise was matched only by the speed of its unravelling. At the heart of its downfall lies a critical misstep: The relentless pursuit of growth through acquisitions and brand launches, even as cracks in its house-of-brands model began to show. Instead of pausing to consolidate and build sustainably, Good Glamm doubled down—prioritising valuation over viability.
That strategy came to a head on July 23 when founder and CEO Darpan Sanghvi announced the dissolution of the group’s house-of-brands structure. In a LinkedIn post, Sanghvi confirmed that lenders would now oversee the sale of individual brands, effectively ending the company’s vision of building a digital-first FMCG conglomerate.
Despite raising $30 million in 2024 and undergoing multiple rounds of restructuring, the group failed to integrate its acquisitions or generate sustainable profitability. With key investors such as Accel and Bessemer Venture Partners exiting the board and leadership turnover accelerating, the company’s ambitious empire—built on rapid expansion and aggressive brand aggregation—has now been reduced to a lender-led breakup.
In the aftermath of the announcement, Sanghvi offered a candid reflection on what went wrong. “In hindsight, it wasn’t one decision, one market force, or one acquisition. It was three levers we pulled, which together, turned Momentum into a Trap,” he wrote in a LinkedIn post. According to Sanghvi, the group’s downfall stemmed from doing “too much, too fast and too big”.
He elaborated: “At first, Momentum feels like your greatest ally. Every headline, every funding round, every big launch is a shot of adrenaline. And you start believing you can do more and more and more. But momentum has a dark side. If you stop steering and go in a hundred different directions, it doesn’t just carry you forward, it drags you faster and faster until you can’t breathe.”
Where The Model Broke?
In October 2017, Sanghvi launched direct-to-consumer (DTC) beauty brand MyGlamm. Most brands at the time were big on selling on marketplaces such as Amazon or Nykaa. However, Sanghvi believed, “We wanted to be truly DTC and not just digitally enabled. We believed that to own the customer, the transaction needs to happen on our own platform.”
But the biggest challenge with being a DTC brand is its customer acquisition cost (CAC). Towards the end of 2019, the company was spending about $15 (over ₹1,000) to acquire a customer to transact on their website. “Around the same time, our revenue run rate was ₹100 crore. We were spending about $0.5 million to acquire 30,000 customers a month. That’s when we realised it was time to solve the CAC problem,” Sanghvi told Forbes India in 2022. In an attempt to find a solution, Sanghvi turned to the content-to-commerce model.
And then, started the acquisition spree. According to Sanghvi, with a single brand in a single category one can’t build scale. He told Forbes India, “The most you can scale it is ₹1,000 crore, if you want a company that’s doing ₹8,000 or ₹10,000 crore in revenue, it has to be multiple brands across multiple categories.” In hindsight, this perspective might be debatable.
As Devangshu Dutta, founder of consultancy Third Eyesight, points out, the “house of brands” model is essentially a modern-day consumer-facing business conglomerate—and its success hinges on multiple factors working in harmony. While there are examples globally and in India of such models thriving, both privately and publicly, the reality is far more nuanced. “Brands take time to grow, and organisations take time to mature,” Dutta notes, emphasising that rapid aggregation of founder-led businesses under a single ownership umbrella is no guarantee of success.
In recent years, Dutta feels the influx of capital into early-stage startups and copycat models—often seen as lower risk due to their success in other geographies—has shortened business lifecycles and inflated expectations. The hope is that synergies across the portfolio will unlock outsized value, but that rarely plays out as planned. “It is well-documented that more than 70 percent of mergers and acquisitions fail,” he adds, citing reasons such as weak brand fundamentals, lack of synergy, inadequate capital, limited management bandwidth, and internal misalignment.
In the case of Good Glamm, these fault lines became increasingly visible as the group expanded faster than it could integrate or stabilise.
Scaling Without Steering
In FY21, the company had losses of ₹43.63 crore, which rose to ₹362.5 crore in FY22 and went up to ₹917 crore in FY23. Despite the mounting losses, Good Glamm marked its entry into the US market, in a joint venture with tennis player Serena Williams to launch a new brand—Wyn Beauty by Serena Williams. The launch was in partnership with US-based beauty retailer Ulta Beauty.
For its international expansion, it invested close to ₹250 crore over three years. “We anticipate that the international business will account for 25 to 35 percent of our total group revenues by the end of next year. This strategic focus on international expansion is pivotal as we prepare for our IPO in October 2025,” he told Forbes India in April 2024.
Clearly, things didn’t pan out as expected. As Sanghvi rightly points out, it was indeed a momentum trap. “You tell yourself you’ll fix the leaks after the next milestone. But the milestones keep coming, and so do the leaks. Soon, you’re running from fire to fire, never realising that the whole building is getting hotter. And somewhere along the way, you lose the stillness to think,” he writes on his LinkedIn post.
Dutta feels that a strong balance sheet is the most fundamental requirement, “to provide growth-funding for the acquisitions or for allowing the time needed for the acquisitions to mature into self-sustaining businesses over years. In the case of VC-funded businesses, the pressure to scale in a short time can go against what may be best for the business or for its individual brands”.
The Good Glamm Group’s fall is a reminder that scale alone doesn’t build resilience. Its story reflects the risks of expanding faster than a business can integrate, and of prioritising valuation over value. The house-of-brands model can work—but only when backed by strategic clarity, operational discipline, and patience. This is less a warning and more a reminder for founders: Scale is not success, and speed is not strategy.
(Published in Forbes India)
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July 28, 2025
By Meenakshi Verma Ambwani, Hindu Businessline
New Delhi, July 28, 2025
Nykaa said that Kay Beauty, co-founded with actor Katrina Kaif, has crossed the ₹240 crore mark in terms of Gross Merchandise Value.
Stars from the tinsel town are donning the entrepreneurial hat to venture into the beauty and fashion business space. Some have even succeeded in growing their brands sustainably, earning big bucks.
Take for instance Skincare brand Hyphen, co-founded by actor Kriti Sanon with Pep Brands, which recently touched the ₹400 crore-mark in Annual Recurring Revenues.
Tarun Sharma, CEO and co-founder, Hyphen told businessline: “The brand is witnessing healthy growth rate quarter-on-quarter. In the first year itself, it touched ₹100 crore ARR. We had aimed for ₹500 crore ARR in 3-4 years and, within two years, we are at ₹400crore ARR.” Pep Brands led by Sharma owns mCaffeine and Hyphen.
The model that works
Sharma believes an operator-led, celebrity anchored model works better. ”The operator can bring in the necessary financial and execution muscle. If a celeb partners with an operator that has deep expertise in the space, then there is huge potential for growth,” he added.
“Product launches, marketing and distribution are very data-driven at Pep Brands. It guides us on what to launch, when to launch, and how to launch products. That has helped Hyphen in achieving this kind of growth rate. It is by design that the majority of the business of Hyphen is D2C,” Sharma explained.
In May, Nykaa said that Kay Beauty, co-founded with actor Katrina Kaif, has crossed the ₹240 crore mark in terms of Gross Merchandise Value. On an earnings call for Q4FY25, Adwaita Nayar, Executive Director, Chief Executive Officer, Nykaa Fashion, said: “Kay Beauty is one of the fastest-growing brands on the platform. It’s hit about ₹240 crore of GMV. The innovations have been fantastic this year. So, it is quite a premium brand, and I think the consumers are accepting it even at that price point. It’s got great gross margins.”
Earlier this year, Reliance Retail Ventures announced that it has decided to acquire 51 per cent stake in Ed-a-Mamma , a kid and maternity wear brand founded by actor Alia Bhatt. According to some reports, Hrithik Roshan’s sportswear brand HRX is a ₹1,000 crore brand.
Among the recent entrants are Ranbir Kapoor, who has decided to foray in the apparel and accessories space with ARKS. Launched in February, the brand has also launched its first store in Mumbai, followed by a second store in New Delhi and another with Broadway in Hyderabad.
‘Shift in preferences’
Abhinav Verma, co-founder and CEO, ARKS, told businessline: “We are seeing a shift in consumer preferences towards made-in-India brands. We decided to leverage on the strong manufacturing capability that India has to build a brand that is both aspirational and offers value. We are looking to build a ₹100 crore brand in the next 3-4 years with a strong omni-channel strategy.”
“The success of some of these brands demonstrates that building on consumer relevance and with powerful time-bound execution, celebrity ventures can become significant players in a crowded market. With consumer demand for relatability and digital-first branding on the rise, this segment will definitely grow. However, only brands that offer genuine value to consumers, and not just star appeal, are likely to endure,” said Devangshu Dutta, CEO, Third Eyesight.
(Published in The Hindu-Businessline)
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July 16, 2025
Prabhanu Kumar Das, Medianama
16 July 2025
E-commerce logistics platform Shiprocket announced the launch of Shunya.ai, a sovereign AI model developed in India to support the country’s Micro, Small and Medium Enterprises (MSMEs), on July 11. The company claims that it is India’s first multimodal AI stack, built in partnership with US-based Ultrasafe Inc.
This announcement comes at the heels of Shiprocket filing a confidential draft red herring prospectus (DHRP) with the Securities and Exchange Board of India (SEBI) in May 2025 for their Initial Public Offering (IPO). The company is expected to raise around Rs 2500 crore in its IPO.
What does the AI model offer?
As per Shiprocket’s website, Shunya.ai is built on a freemium model, with unlimited access priced at Rs 499 a month for MSMEs. It is directly integrated into the Shiprocket platform and offers AI agents across multiple languages. According to the company, the agents can perform the following tasks:
Shiprocket CEO Saahil Goel stated, “We’ve adapted Shunya.ai from the ground up for Indian languages, commerce workflows, and MSME needs. By embedding it directly into our platform, we’re giving over 1,50,000 sellers instant access to tools that are intelligent, local, and scalable, levelling the playing field for businesses across Bharat.” Notably, Larsen and Toubro’s AI cloud arm, Cloudfiniti is reportedly providing the underlying GPU infrastructure, ensuring that all data processing and storage remains within India.
This AI model does offer multiple benefits but it will not level the playing field against big players, as per Devangshu Dutta who is the founder of specialist consulting firm, Third Eyesight.
“While Shunya AI can help small businesses compete better, it won’t completely level the playing field. Large companies still have greater organisational capacity and capability to respond to the insights offered, including more data and bigger budgets. The real benefit for small businesses is improving how they work and serve customers within their current markets, rather than suddenly competing with giants,” Dutta said.
The E-Commerce AI Pivot
This is not the first time that an Indian e-commerce platform has unveiled a B2B AI service through its existing platform. Zepto recently launched Zepto Atom in May 2025, a real-time tool that offers consumer brands available on the platform minute-level updates, PIN-code level performance maps, and Zepto GPT, a Natural Language Processing (NLP) assistant trained on internal data that brands can query about their stock keeping units (SKUs) and performance data.
Zomato and its e-commerce arm Blinkit have also been growing their AI capabilities. Analytics India Magazine previously reported that the company’s generative AI team has grown from 3 to 20 engineers in the time-span of a year. Zomato introduced a personalised AI food assistant for users, and also uses AI in its backend to optimise delivery times and improve consumer support. Blinkit also released the Recipe Rover AI in May 2023, an AI assistant for recipes.
Other companies like Swiggy with ‘What to Eat’ AI, Myntra’s MyFashionGPT AI shopping assistant, and Amazon’s Rufus have also adopted AI assistants on their platform as a tool for the consumer.
The issue of merchant stickiness
Dutta asserts that this shift means platforms like Zepto and Shiprocket are changing from being service providers to becoming data intelligence companies. They are generating, or are in the process of generating revenue through transactional data that flows through the company.
“While this can create better insights and automation for merchants on these platforms, it also could make the merchants more dependent on the platforms. Once a merchant builds its operations around a platform’s specific AI tools and insights, it becomes much harder to switch to a competitor – creating stronger merchant stickiness. We already see this in infrastructure and core services such as banking and financial services, enterprise cloud services, building management etc. and the same is likely to happen in AI-enabled process management”, he said.
Why this matters
As Shiprocket is preparing for an IPO, Shunya.ai becomes another means to generate revenue for the company. This app can extend Shiprocket’s reach to local physical stores and MSMEs, by offering them the opportunity to provide the same experiences and support to the consumer that larger retailers and e-commerce platforms do, while automating delivery automation, cataloguing, and customer support.
Furthermore, the launch of this model is also part of the larger trend of AI integration and automation, both within e-commerce platforms for their consumers and within the back-end for optimisation.
Competition in these sectors and merchant stickiness may also become an issue, as businesses hosted on these e-commerce services may become reliant on specific AI tools and their outputs.
Questions of data privacy are also important when it comes to service companies moving towards data intelligence: How do these AI models gather and use data? The consent of end-consumers in these B2B models, data storage, and security are all issues that need to be studied as e-commerce and retails pivots towards AI.
Some Unanswered Questions
MediaNama has reached out to Shiprocket with the following questions and will update the article when we receive a response.
(Published in Medianama)
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July 10, 2025
Alka Jain, Outlook Business
10 July 2025
Just when Blinkit, Instamart and Zepto were slowing down in their quick commerce game, Amazon’s entry may spur them towards a more aggressive race. The ecommerce giant has begun offering deliveries in as little as ten minutes in Delhi after Bengaluru, under the name ‘Amazon Now’.
“We are excited with the initial customer response and positive feedback, especially from Prime members. Based on this, we are now expanding the service over the next few months addressing immediate customer needs while maintaining Amazon’s standards for safety, quality and reliability,” the company said in an official statement.
Till now, the company was moving at its own pace with the idea that Indian consumers would wait a day or two for their deliveries. But the game has changed now—convenience is king here. Online shoppers want everything from milk to mobile chargers within a few minutes at their doorsteps.
And the big three of the quick commerce market—Blinkit, Instamart, Zepto—have cracked the consumer code perfectly. This trend has nudged Amazon and Flipkart to enter the 10-minute delivery segment. It started as an experiment in the larger ecommerce sector but has now become a necessity for online retailers.
Kathryn McLay, chief executive of Walmart International—an American multinational retail corporation—revealed that quick commerce now accounts for 20% of India’s ecommerce market and is growing at a rate of 50% annually. According to a Morgan Stanley report, the market is expected to reach $57bn by 2030.
Hence, Amazon could not afford to stay on the sidelines. The company has already pumped $11bn into Indian market since 2013 and recently announced another $233mn to upgrade its infrastructure and speed up deliveries. In addition, it has also opened five fulfilment centres across the country.
Despite continued investment, there are doubts if Amazon can disrupt the quick commerce game. Industry experts state that the ecommerce major’s late entry could upend the fragile unit economics of the space. It can even reignite discount wars and increase burn rate (a company spending its cash reserve while going through loss) for the incumbents, once the ecommerce giants begin to exert pressure and begin to capture market share.
Open Market, Thin Margins
Given the growth momentum and market size, quick commerce start-up Kiko.live cofounder Alok Chawla believes that there is definitely headroom to accommodate another player in the quick commerce market. However, margins may remain negative for a couple of years due to high business and delivery costs.
As per data, the average order value of ₹350–₹400 yields a gross margin of approximately 20% but high fulfilment and delivery costs (₹50–₹60 per order) significantly reduce overall profitability, often cancelling out most of the gains.
“Indian customers will not be willing to pay high shipping charges for convenience. But the market will continue to grow due to cart subsidies and shipping discounts. On top of this, profitability also remains quite some time away,” he says.
Even a survey by Grant Thornton Bharat, a professional services firm, shows that 81% of Indian quick commerce users cite discounts and offers as one of the main reasons they shop on platforms like Blinkit and Instamart.
But the fact is Amazon has extremely deep pockets, which means, the trio will once again have to get into aggressive discounting to protect their turf, said Chawla, indicating the possibility of higher cash burn quarters ahead.
In February, reports revealed that Indian quick commerce companies, including new entrants, were burning cash to the tune of ₹1,300–₹1,500 crore on a monthly basis. But a few months later, Aadit Palicha, chief executive of Zepto, a fast-growing 10-minute delivery platform, claimed that the company had slashed its operating cash burn by 50% in the previous quarter.
Still, the path to profitability remains shaky. Though Amazon can get an advantage of its existing huge customer base that is habitual of making online purchases including those in similar categories.
The real challenge lies beneath the surface because ecommerce and quick commerce operate on fundamentally different engines.
E-Comm vs Q-Comm: A Different Game
It may seem like a simple extension of what Amazon already does: deliver products. But in practice, the logistics, timelines and cost structures behind traditional ecommerce and quick commerce are different, said Somdutta Singh, founder and chief executive of Assiduus Global, a cross-border ecommerce accelerator that helps brands scale on global marketplaces through end-to-end solutions.
She explains the difference using a hypothetical situation: let’s say you order a phone case in Mumbai, which is picked from a nearby fulfilment centre. It will be added to a pre-routed delivery run with 30-50 other stops. This batching on the basis of route optimisation, keeps last-mile costs low, somewhere around ₹40–₹80.
But if you order the same item in a smaller town like Alleppey, it may first travel mid-mile from a hub in Cochin, then be handed off to a local partner like India Post. This increases the delivery time but keeps costs manageable through scale and planned routing.
This setup suits well in ecommerce business, which is built for reach and variety, not for speed. However, quick commerce runs on a completely different playbook because speed becomes priority here.
For instance, you order a pack of chips and a cold drink via Zepto in Andheri. These items are already stocked in a dark store within one to two kilometers of your home. The moment you place the order; someone picks it off the shelf. A rider is dispatched almost immediately and heads directly to your address.
There is no mid-mile movement, no routing logic and no batching. Each trip is a solo run. Delivery often happens within 10 to 15 minutes. This kind of speed relies on a dense network of local stores and a steady flow of short-range riders. But it also means higher costs.
“With no bundling of orders and lower average cart sizes, usually ₹250 to ₹300, the delivery cost per order can shoot up to ₹60 to ₹120. That is a heavy operational burden. Unlike traditional ecommerce, where cost efficiency scales with distance and order volume, quick commerce is constrained by geography and time pressure,” she explains.
So, it becomes more than just a category expansion for e-commerce platforms like Amazon and Flipkart. It marks a pivot in their “logistics thinking” and signals a broader shift in entry strategies. What once worked must now be retooled for hyperlocal and real-time operations.
Speed over Scale Not Easy
There are multiple challenges ahead for Amazon to make its presence felt and stay competitive in the quick commerce space. Firstly, it must build an operations and logistics layer that enables sub-15-minute deliveries, along with a technology stack to support it, according to Mit Desai, practice member at Praxis Global Alliance, a management consulting firm.
Second, it needs to build a dark store network to succeed in the space which is crucial to meet the 10-15 minutes delivery promise. Experts believe that a hybrid model will be the most successful in India—a mix of micro warehouses, partner stores and dark stores.
Desai states that Amazon’s existing capabilities can give it a base to build on, but it would also have to account for complexities and differences that come with the quick commerce business.
“For Amazon, the challenge will be operations. Can they build 700+ dark stores? Can they go hyperlocal? Can they navigate the chaos of Gurugram rain, Bengaluru traffic or the lanes of Dadar?” wonders Madhav Kasturia, founder and chief executive of Zippee, a quick commerce fulfilment start-up focused on hyperlocal deliveries and dark store management.
Another challenge can be repeat, loyal customers. As of now, customers check prices across platforms, and order where prices are the lowest. So, Amazon will have to spend heavily on discounts to gain market share. Chawla says retention will remain a problem because Zepto’s growth has also slowed down after a reduction in discounting burn.
However, Singh highlights that Amazon may not roll out everything in one shot. “We will likely see small-scale pilots, co-branded dark stores, local partnerships, new rider networks, tested in top cities before any nationwide push. They will also reveal whether it is viable to retrofit scale-driven e-commerce infrastructure into something that runs well in a hyperlocal loop,” she added.
Profitability Remains a Concern
While the quick commerce space is becoming increasingly dynamic with new entrants, the core question remains: is it a sustainable business model? The path to profitability is still fraught with operational complexity, margin constraints and uncertainty in consumer behaviour.
“Margins in quick commerce were never pretty to begin with,” says Kasturia. Yet he remains optimistic about the market because India’s grocery market is still largely untapped online.
As per data, India’s grocery and essentials market is over $600bn, of which online commerce is just three to four percent. Even quick commerce is sitting at ₹7,000–₹9,000 crore gross merchandise value today. So, the market isn’t crowded. It’s just early.
“We are barely scratching the surface,” he says, arguing that whoever wins customer behaviour, will lead the game. For example, in tier 1 cities, users no longer compare prices—they compare time.
For Amazon, this is both an opportunity and a constraint. Experts believe that the ecommerce giant can stand out by focusing on trust, hygiene and reliability—areas where existing players sometimes falter.
Kasturia says that the platform should not even chase everything, rather focus on profitable categories like fruits, dairy and personal care. “Build strong private labels. Nail density before geography and don’t discount blindly,” he adds.
The key is to build for reorders, not virality. That’s when customer acquisition cost (CAC) drops, margins compound and a player stops bleeding money per order. And to reduce the cost of dark stores, Chawla suggests an alternative route.
“Riding to neighbourhood stores for long-tail stock keeping unit can cut real estate and wastage costs,” he says, adding that it can decentralise inventory without owning all of it.
To follow this playbook, Devangshu Dutta, founder of Third Eyesight, a management consulting and services firm, says that every player needs to invest hundreds of crores before the model begins to show surplus cash. It will demand multiple, interlocked shifts—in pricing strategy, tech backbone, category mix, and even brand positioning.
Amazon’s entry doesn’t merely add another contender in the 10-minute delivery race—it rewrites the playbook for every player. The real question now is: can the frontrunners hold their turf, or will Amazon’s scale and deep pockets tip the balance of power?
