Flipkart takes quick commerce beyond metros, aims for 800 dark stores

Company targets tier-2 and tier-3 cities with its Flipkart Minutes service, doubling business every 45 days and aiming to scale up before festive season

Flipkart is betting its quick-commerce future on India’s smaller cities, targeting tier-II and tier-III markets that rivals have largely bypassed in their race to dominate metropolises.

 

The Walmart-owned e-retailer’s 11-month-old “Flipkart Minutes” service is now live in 19 cities, including Ghaziabad, Guwahati, Jaipur, and Kanpur. Backed by an internal funding infusion of about ₹3,249 crore, the company aims to scale up to 800 dark stores by the end of the year, up from 400 currently.

 

The geographic strategy marks a strategic divergence from competitors prioritising metro markets and affluent consumers. Flipkart’s model is gaining traction: The company says the 10-minute delivery service is doubling in volume every 45 days.

 

That momentum comes as Flipkart attempts to close the gap with quick-commerce leaders. Blinkit currently operates 1,301 dark stores, followed by Swiggy Instamart with 1,021, and Zepto with more than 750.

 

“We are getting a very encouraging response,” Hemant Badri, senior vice president and head of supply chain at Flipkart Group, told Business Standard. “Traction in these smaller cities has exceeded expectations. Flipkart’s loyal customer base as well as new customers are trying it.”

 

Flipkart now serves more than 500 million users across 95 per cent of Indian pincodes, potentially giving it an edge in scaling outside urban strongholds.

 

 

 

Focus of fresh produce

 

Central to Flipkart’s offering is a focus on fresh produce and high-quality perishables. The company is leveraging its existing supply-chain infrastructure, including fulfilment centres, cold-chain logistics, and a 120,000-strong gig workforce, to expand delivery capabilities in underpenetrated markets. “We are picking from farmers and there are very few players who would assure that quality,” Badri said. He emphasised that Flipkart's farm-to-fulfilment model is backed by cold-chain reliability and affordability.

 

Multi-speed delivery

 

Flipkart is also rolling out a multi-speed delivery framework. In addition to 10-minute delivery via Flipkart Minutes, the company now offers same-day and next-day delivery for core product categories.

 

Same-day delivery is now available in 20 cities for mobile phones and electronics, and in 16 cities for large appliances. “Whatever you order till 1 pm, you get it delivered on the same day across 20 cities,” Badri said.

 

To support this expansion, Flipkart has recently added a 450,000-square-foot fulfilment centre in Patna and is activating a 140-acre campus in Manesar -- part of its ramp-up ahead of the flagship Big Billion Days sale expected around September.

 

 

Automation drive

 

Flipkart is investing heavily in automation and AI across its 100-plus logistics facilities. Proprietary address-intelligence systems are used to flag inaccuracies and enable geofencing, improving last-mile efficiency in smaller cities.

 

AI-led replenishment models are also deployed to automate inventory planning and restocking, which are vital for maintaining service standards in a 10-minute delivery model. “It’s very important to predict what is going to sell in which store,” Badri said.

 

Workforce development is a parallel priority. Flipkart’s Supply Chain Operation Academy trains around 15,000 individuals annually, helping standardise operations while offering local employment.

 

This allows people to stay where they are rather than migrating to metros, Badri said. 

 

Investment race

 

Analysts estimate that Flipkart and Amazon may each need to invest at least $1 billion over the next few years to scale quick-commerce operations and compete with entrenched players. Amazon recently entered the space with “Amazon Now.”

 

The challenge for Flipkart is sustaining high growth while building the dense network of dark stores required to operate profitably. Demand typically spikes during festivals, pushing Flipkart to expand consistently across “more geographies” while improving “execution, discipline, and spread,” Badri said.

 

The key question: Can Flipkart’s tier-II and tier-III strategy deliver the revenue density required to justify capital investments? The upside, if successful, is considerable. India’s online retail market could grow to $325 billion by 2030, more than four times the $70 billion recorded in 2022, driven largely by demand from smaller cities, according to Deloitte India. That trend could ultimately validate Flipkart’s geographic strategy.