by Online shopping has seen tremendous growth over the past decade across Europe. But a new format of online shopping called ‘Quick Commerce’ is gaining rapid popularity and transforming online grocery shopping. Quick Commerce promises delivery of items within minutes instead of hours or days.
Understanding Quick Commerce
Quick Commerce, also called Q-Commerce, refers to online services that deliver grocery and household essential items to customers within a few minutes to an hour. This ultra-fast delivery is made possible through a dense network of micro-warehouses located close to customers. These micro-warehouses hold thousands of frequently purchased items that are picked, packed and delivered within a very short time once an order is placed.
The key features of Quick Commerce include:
– Delivery of groceries and essential items within 15-60 minutes
– Dense network of micro-warehouses located across cities
– Small inventory of fast-moving items at each micro-warehouse
– Technology powered instant picking, packing and delivery
– Convenience of impulse purchasing of daily needs
Growth of Quick Commerce in Europe
Several Quick Commerce startups emerged in Europe in 2021 to tap into the fast-growing online grocery demand and consumers seeking instant gratification. Some of the major Quick Commerce players in Europe include:
– Gorillas – Germany based startup with operations across 10 countries in Europe. Claims to deliver within 10 minutes.
– Getir – Turkish startup valued at $7.5 billion with presence in UK, Germany, France, Netherlands and Portugal.
– Flink – Berlin based startup operates in over 20 cities in Germany.
– Jokr – Founded in NYC, acquired by Chilean retail giant Cencosud. Operating in Spain, Portugal, Brazil.
These Europe Quick E-Commerce (Quick Commerce) startups have raised huge funding and rapidly expanded their micro-fulfillment centers across major cities. Gorillas alone operates over 100 warehouses and aims to have over 200 by end of 2021. Getir and Flink are similarly aggressively expanding their footprint.
Consumer Demand driving Quick Commerce Growth
The speed and convenience offered by Quick Commerce platforms perfectly match the needs of urban consumers:
Changing lifestyles – Younger urban population lead busy lives and value instant gratification over planning purchases in advance.
Impulse purchases – Quick Commerce allows spontaneous addition of snacks, drinks or missing ingredients while cooking directly from the app.
Time poverty – Tight schedules leave little time or energy for extensive shopping trips to crowded stores.
Rising subscriptions – Many Quick Commerce players offer subscription plans for frequent users to reduce delivery fees and enable true instant ordering.
Challenges and Future for Quick Commerce
While Europe Quick E-Commerce (Quick Commerce) addresses critical consumer needs, high-speed operations come with their own set of challenges:
Economics – Profitability remains a challenge due to high costs of dense micro-fulfillment infrastructure and quick delivery operations.
Inventory management – Maintaining limited but most relevant inventory across a large number of micro-warehouses is complex.
Unit economics – Achieving profitability requires scale as costs are front-loaded while revenue generation happens gradually over time.
Competition – With low entry barriers, many new entrants are emerging, increasing competitive intensity.
Sustainability – Massively rapid deliveries increase road congestion and carbon footprint if not optimized intelligently.
