India’s retail industry is witnessing a major change as quick commerce — the ultra-fast delivery of daily household items through digital platforms — impacts how consumers shop. Not so long ago, this was a niche experiment. But this has quickly evolved into a vital retail channel, boosted by wide penetration of smartphones, availability of fast internet and changing consumer expectations, according to an analysis by the India Brand Equity Foundation (IBEF).

Traditionally, Indian households shopped once in a week at local mom and pop shops to stock up on groceries and household items. Today, the same set of consumers order groceries, medicines and snacks through mobile applications and receive them within minutes. The shift got a major boost during the pandemic.

According to a study by the Indian Institute of Management Ahmedabad, online grocery purchases in India jumped 80% in 2020, reaching roughly INR239.51bn ($2.7bn). The rapid expansion laid the foundation for the expansion of quick-commerce services.

In recent years, the sector has seen rapid growth. Industry estimates suggest that the gross order value of quick commerce in India rose from a small base in 2022 to about INR656.45bn by FY25. This represents roughly a 24-fold increase in just three years, according to IBEF analysis.

In 2024, almost two-thirds of all online grocery transactions in the country were made up of quick-commerce orders. Also, approximately 10% of overall e-retail spending constituted the same, IBEF said citing data by Bain & Company.

Before the advent of quick-commerce platforms, about one-third of frequent urban shoppers preferred purchasing daily necessities online. That share has jumped to about 87% now.

The explosive growth in quick commerce is also generating employment opportunities across India’s urban logistics ecosystem. This employment intensity is comparable to general trade and significantly higher than modern organised retail or traditional e-commerce, according to IBEF.

The jobs generated span a variety of roles such as warehouse pickers, packers, delivery personnel and operational staff, as well as positions in technology, marketing and management. Several major platforms have already built sizeable workforces.

Many of these jobs operate within the gig economy. Delivery riders often work flexible hours through platform-based arrangements, allowing the sector to absorb large numbers of workers in cities and emerging urban centres. This has helped formalise certain aspects of gig employment while expanding opportunities in logistics and customer service.

The industry has also been helped by strong investor interest. Major US companies such as Amazon and Walmart have invested in ultra-fast delivery models to remain competitive, while international investors increasingly view India’s quick-commerce success as evidence of the country’s growing digital consumer market.

IBEF believes that the sector is expected to witness strong momentum. According to Cornell University research, quick-commerce gross merchandise value in India could hit $35bn by the end of this decade. This will primarily be driven by expanding digital connectivity. India reported about 954mn internet users in 2024, and forecast that the number of online shoppers will touch between 500mn and 600mn by 2030. As connectivity spreads deeper into smaller towns and semi-urban areas, quick-commerce platforms are expected to tap a new set of consumers beyond major metropolitan centres.

Rising incomes and a growing middle class are also fuelling demand for convenience-oriented services, including rapid home delivery.

The future growth in the industry will come from smaller cities where logistics infrastructure and “dark store” networks are gradually being established.

Technology will also play a vital role in the further development of the industry. Quick-commerce companies are using artificial intelligence tools for demand forecasting, inventory management and route optimisation. Automated warehouses and micro-fulfilment centres are also being set up in several cities to enhance operational efficiency.

The companies are also expanding beyond groceries. While initial focus was on delivery of food and daily used items, many quick commerce platforms are now branching out into electronics, health products and personal care products. Items such as cosmetics, sweets and seasonal goods are also being increasingly ordered as consumers become used to instant delivery.

At the same time, companies are eyeing new business models to attain sustainable profitability. With deep discounting slowly being done away with, platforms are working on generating revenue through advertising, subscription services, delivery charges and private-label products.

Environmental sustainability is also being taken seriously. Electric delivery vehicles are being extensively used and recyclable packaging solutions are being adopted in response to growing concerns about emissions and waste generated by rapid delivery operations.

From a global perspective, India’s quick-commerce industry remains smaller than that of China but is growing at a rapid clip. IBEF says that only about 4% of Indian consumers currently use quick-commerce services, compared with nearly one-quarter of consumers in China. This gap highlights the enormous potential for further expansion.

Despite challenges around profitability and sustainability, quick commerce is set to remain a powerful force shaping India’s retail landscape. As digital connectivity penetrates further in the system and consumer expectations continue to evolve, instant delivery services are likely to become a permanent feature of the country’s rapidly modernising retail ecosystem.