Quick Commerce - Logistics and Infrastructure

Getting goods delivered to your doorstep within minutes requires a very strong and reliable logistical infrastructure. Here we will try to explain the operational part of Quick Commerce companies in simple terms. There are three things that are mandated for any Quick Commerce establishment, and those are −

• Dark warehouses − These are basically storehouses or warehouses set up by the company in densely populated areas. These warehouses will be the storehouse for all the goods produced by the company and will not be used as retail outlets or serve walk-in customers. While having a word with the delivery partners, we found out that their area of operation is within a range of 5 kilometers. This means that in the distance of every 5 kilometers for the Zepto company, you will find a dark house. Also, the average delivery time for the delivery partners was 10 minutes, and the average distance traveled for each order was 1.8 km.

  This varies from company to company. Instead of installing the warehouse, companies can also chain up with local distributors. In this way, the company would not have to maintain a large inventory but would also not be able to deliver variety to its customers. Hence, an amalgamation of both the dark house and the partnership with retail distributors is preferred.

• Technology-driven inventory management system − For Quick Commerce to be successful, it is crucial for companies to keep a tab on their inventory. These systems will order the required items when the stock falls below the minimum order level and are continuously doing so day and night. Along with this, a bar code is assigned to each item to keep tabs on all the inventory and the sales being made.

  Zepto's delivery partner told us that it takes Zepto around 60 seconds to collect all the items of the order, and it is the responsibility of the delivery partner to check the quantity and the date of expiration of the product. Without a well-working and established inventory management system, Quick Commerce companies cannot work.

• Customer-driven stocking of goods − companies should use AI to understand what a particular geographical location is asking for and stock goods accordingly. For example, if we have a dark store near the official area, we would want the store to have more and more stationery items, corporate or small gifts, and food munchies rather than Indian spices, oil, or ghee. This logical stocking of goods as per the number of orders by the customer and their sentiment will help the company have a higher turnover of stock and better profitability. The company gets a sense of the type of goods that customers in that particular area order and then stocks them accordingly in their warehouses.

• Availability of delivery partners − Another thing that a company has to take care of is the availability of delivery partners and their two wheels for the order to get placed. Companies sometimes have to bear the loss of having labor sit for the maximum number of hours. An incentive-based mode of salary is a more economical and logical step for the company. The company, however, should be ready to bear some blows.

If setting up the logistics of a Quick Commerce company may seem too tiresome or costly, then companies can also tie up with the already established big Quick Commerce companies to sell their products. This will help them focus on the more important issue of the production of goods as well as the marketing of goods rather than the distribution of goods.