Quick commerce firms can preempt intrusive regulations of their dark stores by converting some of them into bright neon-sign-lit stores

The recent central government intervention to stop quick commerce firms from making 10-minute delivery their USP hasn’t come a day too soon. Two things must be noted at the outset. First, 10 minutes should not be read literally. It should be interpreted to ban unrealistic and dangerous delivery timelines, say 12 minutes or 15 minutes, because if it is put in a straitjacket of 10 minutes, it will resort to creative interpretation like airlines do to circumvent UDAN—you cannot charge more than Rs 2500 if the flight is of less than one-hour duration. Ergo, increase the time duration to one hour and five minutes! Second, the ban is not directed at grocers, including greengrocers, alone. It extends to food delivery apps as well. For that matter, it extends to any delivery executed through any e-commerce portal at all. It was not as if the 10-minute delivery promise was taken as a holy writ. It was just a sales pitch, although it must be conceded, on average, online orders were delivered within 25 minutes, thanks to their dark stores being located close to the customers, much sooner than by the e-commerce firms setting stores by the marketplace model that, on average, deliver in 2 to 3 days. The delivery apps of quick commerce firms resort to gimmicks, including freezing the clocks till the delivery partner is ready, to foster the image that the firm adheres to its timeline come what may. To wit, the last 5 minutes could remain frozen for 10 minutes before the further countdown resumes. 

Warts and all, the Indian quick commerce firms, at the end of the day, have been sticking to their promise of fast delivery so much so that late-sitters and shift workers at offices hit the ground running by ordering food in the last mile before their residence. Old people unable to hotfoot it to the nearest brick-and-mortar stores get their provisions as and when they require, sometimes not minding the delivery and handling charges for not meeting the minimum order size. With time being of the essence to all concerned—the firm, its delivery partner, and its customer—the delivery boys, invariably gig workers, put their lives on the block by resorting to rash driving that took a toll on their health and wellbeing, precariously perched as they were with bags on their backs and on both sides of their shoulders bulging into the roads. Accidents on their account inevitably took a toll on other users of the road, caught in the crossfire, as well. 

Quick commerce firms, however, are only feigning to be penitent. While they are game and amenable to removing their 10-minute sales pitch, their USP continues to be quick delivery, not possible under the marketplace model practised by Amazon, whose numero uno status has been broken by them in a manner of David humbling the redoubtable and mighty Goliath. Their success is not only due to the risk-taking by their delivery partners but more due to the quiet, ubiquitous omnipresence of their dark stores to which the public have no access. They are cavernous and huge warehouses, so to speak, to which the orders are passed on by the system software. They stock just about everything which customers need in the humdrum of their lives. Fleet-footed delivery boys are their mainstay, who pick up the orders and rush to the customers. Dark stores are inscrutable as much as they are inaccessible. Often indolent customers are palmed off with old stock, especially when it comes to perishables like vegetables. Indeed, there was a case for regulating dark stores as well. The government instead has chosen to address the low-hanging fruit—delivery boys menacing the roads. 

Quick commerce firms can preempt intrusive regulations of their dark stores by converting some of them into bright neon-sign-lit stores, which the public can walk into for purchases. In the US, for example, weekly shopping missions to Walmarts and Costcos of the world are de rigueur. The pull is rock-bottom prices on the back of direct purchases, eliminating distributors, and the feel-and-touch advantage (crucial in size-based items) not available in e-commerce. Such large stores are conspicuous by their absence in India, with large multinational stores ignoring the FDI partial red carpet, now frayed thanks to disuse. While the minimum US $100 million requirement isn’t too demanding, the further rider that 50% of the FDI should be invested in backend infrastructure has been the repellent. Be that as it may, domestic quick commerce firms can step into the breach, as they are untrammelled by such investment requirements.

Some of their dark stores may be converted, either in the same location or somewhere else in the vicinity, into large brick-and-mortar stores open to the public. They can position themselves for dual use—physical shopping as well as catering to online buyers. The former addresses itself to the touch-and-feel curiosity as well as impulsive purchases. Often, children and women resort to impulsive purchases, enchanted by the attractive displays. Truth be told, while e-commerce is need-based, brick-and-mortar stores afford comprehensive and wholesome shopping, going beyond the immediate household needs. Brand building is far easier and more effective with the physical showrooms rather than with the digital, howsoever nicely and systematically configured in the apps and websites. Such dual-use stores would cater to both physical shoppers and online ones, besides ending the inscrutable dark stores, though in practice inaccessible stockrooms are an inevitable adjunct of any retail store.

If quick commerce firms are reluctant, the government can usher in the second round of quick commerce reforms hot on the heels of the first by mandating front stores abutting the stockyard, as it were, giving customers the option to buy from either. Incidentally, dark stores are not unique to quick commerce alone. Even marketplace firms have them for the last mile. Their dark stores too have come in for criticism on account of lack of hygiene and cleanliness.