Even as the majority of Indian retail continues to rely on brick-and-mortar stores, Shashwat Goenka, vice chairman of RPSG Group, believes quick-commerce is necessary if one wants to survive in the sector. He labelled quick-commerce as a permanent shift in Indian consumer behaviour rather than a passing trend.
Speaking to NDTV Profit as part of the network's comprehensive coverage of the World Economic Forum (WEF) Annual Meeting in Davos, Switzerland, Goenka spoke about the emerging trends in the quick-commerce space and how the conglomerate is planning ahead of competition.
Speaking on RPSG's Jiffy platform, Goenka admitted that the competition and valuation volatility currently define the industry. However, he pointed out that established grocery players such as Specer's Retail can no longer simply sit behind and not follow the trend.
"If you're in the business of grocery, which we have been for many decades, you have to move to where the market is moving," Goenka said. "You can't not have that as a service offering."
"While 85% of India still shops in brick-and-mortar stores, the 15% that shop online, there's over 60% of that that's shopping on quick commerce," he added.
The quick-commerce industry has certainly taken flight, as evidenced by the rapid growth of companies like Eternal and Swiggy. However, the viability of quick delivery models has been questioned due to high cash burn and logistical costs, though Goenka argued that the unit economics are improving.
"What's also happening is the cost of deliveries is coming down, which is making the model more and more viable," he said.
Goenka added that the RPSG group, rather than pivoting entirely to instant delivery, has managed to integrate quick commerce into its existing digital infrastructure.
"So what we actually did is we didn't replace our online model with a quick commerce model; we enabled a quick commerce model within that as well. So while we still allow you to have scheduled deliveries over a three-day period, you can also choose a first schedule or the first slot that's available, which is a quick thirty-minute delivery," he said.
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