The summer of quick commerce
May 2024 saw average temperatures reaching new highs across India, leading to several interesting trends. Quick commerce platforms in particular experienced a high surge in daily orders for grocery and other essentials.
This can be attributed to a large portion of consumers from Mumbai, Delhi NCR, Kolkata and Bengaluru being unwilling to step out and shop under taxing heat. ET retail reports, “Daily deliveries by ecommerce companies including quick-commerce platforms have risen from 1.2-1.5 million a day in May 2023 to over 2 million in May 2024.”
A big chunk of these orders came from Delhi-NCR, the region experiencing the most dire heat wave conditions among all Indian metros. “The Delhi-NCR market has grown at almost 2X of overall growth from metro cities.” said Ujjwal Chaudhry, partner at RedSeer.
As expected, a substantial number of these orders contained items like Ice-cream and cold beverages along with everyday groceries.
Dairy’s red-hot summer
Dairy brands Amul and Mother Dairy both registered a very high month-on-month increase in ecommerce sales. “We are seeing 55-60% higher sales on ecommerce and quick-commerce channels in April-May, compared to the same months last year." said Jayen Mehta, MD of Amul’s dairy business.
“Overall ice-cream sales across channels including grocery stores, modern trade, ecommerce, pushcarts and ice-cream parlors have increased 40% over last year” he added.
Manish Bandlish, MD of Mother Dairy reported similar consumption trends. “With peak summers prevailing across most regions of the country, we are witnessing a significant surge in demand in portfolios like ice-creams, curd and beverages across key markets. Ice-creams alone have witnessed a rise of upwards of 20% compared to the same period last year.”
The company issued statements earlier in March highlighting an expected spike in demand of 25-30% and their supply chains’ readiness to meet it efficiently.
Increasing demand on quick commerce channels
Most of these orders for dairy products and everyday groceries came from quick commerce channels like Zepto, Blinkit and Amazon’s grocery delivery service Amazon Fresh. Srikant Sree Ram, director at Amazon Fresh, highlighted the remarkable growth in both the ice-cream and dairy beverages categories, reflecting a 43% year-on-year increase in units sold. He noted, "Our customer base expanded with a 20% rise in ice-cream shoppers and a 33% surge in those purchasing dairy and dairy alternative beverages."
This has also led to a sharp increase in the demand for delivery drivers available for same-day/instant delivery. “More than restaurant delivery, grocery delivery is seeing increased demand for bikers.” said Kartik Narayan, Chief Executive, Staffing at TeamLease Services. TeamLease also predicts an increased demand for 10,000 additional operations personnel at the dark stores, or distribution centers of ecommerce platforms and 30,000 more bikers to deliver the orders.
The general elections being held across the country in multiple phases have caused several drivers to return home for polling, leading to a shortage of delivery personnel amidst soaring demand. According to TeamLease, 7,000 food and delivery drivers have been quitting their current positions daily. This is a sharp increase from the daily attrition of 5000 drivers seen in summer 2023.
Most drivers are also less likely to accept orders at the peak of noon until the onset of evening to avoid going out in extreme heat. This has become a primary operational concern for ecommerce platforms and is likely to remain so until the arrival of Indian monsoons.
What can consumers do to help?
Despite multiple heatwave warnings and record high temperatures, delivery drivers and store/warehouse personnel have been handling high work loads due to soaring demand and staff shortages, especially in metropolitan areas. While the situation is not likely to ease up at least until mid-June, there are small steps consumers can take to help these workers.
- Recognize that delivery times may be longer than usual due to high demand and extreme weather conditions. Showing patience and understanding can reduce the stress on delivery personnel.
- If possible, offer cold water or a refreshing drink to delivery drivers. This small gesture can help them stay hydrated and cool during their long hours on the road.
- Plan your orders in advance and try to consolidate multiple needs into a single order. This can reduce the number of trips delivery drivers need to make, helping to manage their workload more effectively.
- Encourage friends and family to be considerate and supportive of delivery drivers and warehouse workers. Raising awareness about the challenges these workers face can foster a more understanding and supportive community.
- Try to minimize the number of returns by making thoughtful purchasing decisions. Each return requires additional effort from delivery personnel and warehouse staff.
By taking these steps, consumers can support delivery drivers and warehouse personnel during this demanding period, ensuring that these essential workers are able to meet the increasing demands of thousands of people without impacting their health and well-being.
