How quick must quick commerce be? Rethinking the 10-minute promise

A hard stop at 10 minutes puts lives at risk even if the distance from the dark store to an apartment is a just a few 100 metres

New Year resolutions are mostly as short-lived as the impact of any chief executive’s New Year address to employees. Whatever the longevity of such inspirational activities, some of them do strike a note for their timeliness. One such New Year resolution came from a journalist colleague who has been tracking developments in the quick-commerce space with interest, especially when a section of gig workers (mostly delivery partners) went on strike to protest  their inadequate compensation and demanding an end to the 10-minute delivery model while asking for social security. 

He announced on the first day of the year, after an editorial meeting, that he would not order through quick commerce anymore. The unique resolution drew some attention before others attending the meeting got into a debate on the merits and demerits of the gig workers’ strike. 

The debate on quick-commerce and the labour practices in this segment of retail reached new levels ever since gig workers’ unions knocked on the doors of ministers and bureaucrats recently, calling out some of the top companies in this space for “unfair practices’’. But why has this strike triggered so much reaction even though deliveries ordered through online platforms were not as badly disrupted as anticipated on peak-demand days such as New Year’s Eve? Perhaps, the numbers explain why anything to do with gig work is now core to our lives. 

Consider the latest New Year’s Eve estimates for Eternal (Zomato). Together, Zomato and Blinkit (its quick-commerce unit) delivered more than 7.5 million orders to more than 6.5 million customers on December 31 — all in a single day. These orders were delivered by more than 450,000 delivery partners. Coming to the overall gig universe, including food delivery, quick-commerce, and app-based cab and bike drivers, the numbers would be in the vicinity of 20 million workers —far more than what the top 10 employers in the country cumulatively have on their rolls. The number could reach 90 million by 2030, according to some estimates. As for growth, quick-commerce is described by companies and industry associations to be on an “explosive’’ trajectory. Valued at up to $7 billion as of 2024, the annual compound annual growth rate of quick-commerce is projected at 40 to 70 per cent over the next three to four years. 

While the numbers are staggering, it helps to look beyond them. Although the frontrunners and advocacy groups have been busy pointing at the job creation potential in the gig universe, the gaps in the system need to be plugged so that it can drive several services effectively and add to the country’s gross domestic product (GDP). In a recent podcast with Youtuber Raj Shamani, Eternal founder and CEO Deepinder Goyal admitted that Zomato terminates nearly 5,000 gig workers a month due to fraud cases, while around 150,000 to 200,000 workers leave the platform voluntarily as they may see their jobs as “transient’’. 

The transient nature of the gig business, where such a large-scale churn takes place on a regular basis, is probably indicative of a systemic weakness that critics of the gig platforms as well as political parties have highlighted. That could imply anything from poor wages to unsatisfactory working conditions to the lack of social security.  It is another matter that the 4.5-hour podcast, in which Mr Goyal held forth on his own platforms, Zomato and Blinkit, as well as on rival Swiggy, was recorded some weeks ago and streamed soon after the gig workers’ strike.

 

As the gig debate goes on, even after the moment of the strike has passed, it may be the right time to think about how to do the online gig and app-based business better. It is in nobody’s interest to kill an ecosystem that can employ millions. On quick- commerce, looking at the global models may offer perspective.

 

A few things stand out across key markets such as the United States, China, the United Kingdom, and Japan. For instance, the regulatory framework in online businesses ensures a certain level of product and service quality in many markets. Also, quick-commerce is not synonymous with 10-minute delivery; typically, there’s a band of 10 to 30 minutes, even stretching to a couple of hours. Then, there’s a price, a hefty one in many markets, for superfast delivery. In China, where quick-commerce is called instant retail, incentives and freebies rule, triggering sustainability issues.

 

Ensuring the social security of gig workers, covering the cost of setting up dark stores close to residential areas, and running a profitable business have made quick-commerce a tough balancing act for many companies around the world. In India, we can relax the quick-commerce window, to start with. A hard stop at 10 minutes puts lives at risk even if the distance from the dark store to an apartment is just a few 100 metres. Adequate compensation and social security for workers — which companies claim are already there — should be an integral part of the app ecosystem, with regulatory oversight. Only then can New Year resolutions strike a different note.