Quick commerce, a phenomenon that gained momentum during the pandemic, is currently undergoing a transformation and we can expect next-day delivery to be redundant in the next five years, according to Kabeer Biswas, Co-Founder, and CEO of Dunzo.
Ecommerce platforms must revamp operations to ensure deliveries are fulfilled within a day, and eventually within the hour, Kabeer said during a fireside chat with YourStory’s Founder and CEO Shradha Sharma on the second day of TechSparks 2022, India’s top tech startup conference.
“In the next five years, next-day deliveries will be dead. Consumers will want groceries and essential items faster and within hours. This is the future of quick commerce in India,” Kabeer said.
Startups and larger ecommerce platforms will have to eventually ramp up operations including logistics infrastructure, backend technology and delivery manpower to make this happen, he added.
Kabeer also emphasised that faster delivery does not mean it will be more expensive. Both consumers and companies can benefit cost-wise from quick deliveries in the coming years, he said, noting that companies have sufficient time to conquer the unit economics.
“Fortifying logistics infrastructure will help better the unit economics,” Kabeer said, answering a question about the difficulties of making a profit in the quick commerce business.
However, for the time being, Dunzo will remain focussed on delivering essentials within a reasonable timeframe.
According to the CEO, the company does not wish to become a convenience store. He added that sticking to a limited number of stock-keeping units (SKU) guards Dunzo against distractions of quick delivery and therefore helps keep costs in control.
Kabeer seemed unfazed about the increasing competition in the quick commerce space and said the company remains focussed on the Dunzo Daily business. “Dunzo never wanted to play in a single category. Now, Daily is the most efficient form of hyperlocal delivery,” he said.
The Reliance Retail-backed company’s business grew 94% last quarter, fuelled by the Dunzo Daily service.
The Dunzo leader also weighed in on the topic of using drones for delivery stating that it may be more useful in middle-mile delivery which refers to the process of delivering goods from a warehouse or distribution centre to fulfillment facilities.