Walmart-owned Flipkart, Amazon are squeezing India’s quick commerce startups

India’s quick commerce market is experiencing significant growth, with demand more than doubling for some companies. However, the push for rapid delivery by Flipkart and Amazon is heightening competition in an already crowded market where profitability is challenging.

Flipkart, a major player in India’s e-commerce sector, ventured into quick commerce after local competitors like Blinkit, Swiggy, and Zepto. According to JS, Flipkart has surpassed 800 dark stores—distribution centers for online shopping—this week and aims to double that number by the end of 2026, as reported by UBS.

This expansion occurs as India’s quick commerce sector enters a new phase of intense competition. The competitive pressure is evident in recent events, such as the exit of a Swiggy co-founder this week, as companies revisit their strategies amid increasing competition and rising costs.

Flipkart, owned by Walmart, launched its quick commerce service, Flipkart Minutes, in August 2024, promising deliveries in as little as 10 minutes. Since then, more than 6,000 dark stores have been established, leading to considerable overlap and heightened competition, according to a report from Bernstein earlier this week.

Beyond Major Cities

While Flipkart’s network in India is smaller than that of market leader Blinkit, which operates over 2,200 dark stores, Flipkart is focusing on expanding beyond major cities to drive growth. In contrast, Blinkit plans to increase its dark stores to 3,000 by 2027, concentrating on its top 10 cities.

“Flipkart has this Walmart DNA,” said Satish Meena, founder of the Gurugram-based consumer insights firm Datum Intelligence. “Walmart’s DNA is always about expanding the total addressable opportunity to dominate by expanding the market.”

Flipkart is already seeing growth beyond major cities, with 25–30% of its quick commerce orders now originating from smaller towns, according to a source familiar with the situation who spoke to JS. Orders per dark store have reportedly increased by about 25% each month, the source added.

Nevertheless, growth in quick commerce is still concentrated in larger cities. Bernstein noted that most demand is driven by these urban areas, where higher population density allows for faster deliveries and efficient utilization of dark stores, even as smaller towns begin to catch up.

This urban focus also supports profitability. According to Bernstein, the top eight cities in India account for more than 3,800 dark stores run by the five largest players, with about 3,600 of these stores potentially profitable.

“Metro markets obviously are better in return ratios, better in profitability because of higher throughput,” stated Karan Taurani, executive vice president at Elara Capital, a London-based investment bank and brokerage. “This business is all about higher throughput, and for now, that is coming largely from metro markets.”

However, some analysts see potential beyond major cities in the long run. “Non-metros (small towns) can give a surge if companies expand beyond groceries and offer a wider range of items at faster speeds,” said Datum’s Satish Meena. “Flipkart is betting on that.”

Despite this optimism, expanding beyond large cities will take time. Quick commerce is currently practical in about 125 cities, with dark stores typically taking six to 12 months to achieve maturity and profitability, said Aditya Soman, a senior research analyst at CLSA, a Hong Kong-based brokerage. Many newer stores in smaller towns are still in the development phase, he noted.

Amazon, which entered India’s quick commerce market in late 2024 shortly after Flipkart, is also increasing its presence. The company has launched approximately 450–500 dark stores, with around 330–370 currently operational, according to UBS, as it seeks to capitalize on the growing demand for faster deliveries.

Pressure Mounting on Incumbents

Flipkart is not solely relying on expanding its dark stores to compete but is also implementing aggressive pricing strategies. The company offers some of the highest discounts in the segment—approximately 23–24% across various categories, based on a sample basket analyzed by Jefferies last month—as it aims to attract users in a market where price and convenience are key drivers.

These strategies appear to be effective. JM Financial recently cautioned that Swiggy’s quick commerce business is in a “growth-versus-profitability deadlock” and may destroy shareholder value, suggesting that a takeover by a larger, better-capitalized company could be the best option for investors.

Shares of Eternal, which owns Blinkit, have decreased by about 15% this year, while Swiggy has fallen over 29%. Meanwhile, Zepto is preparing to go public on Indian stock exchanges later this year.

The entry and expansion of major players like Flipkart and Amazon are transforming the competitive landscape. “Quick commerce is no longer in a startup phase—it has become a big players’ game,” remarked Ankur Bisen, a senior partner at retail consultancy Technopak Advisors.

He added that the sector’s economic challenges and limited differentiation could eventually lead to consolidation, as companies compete for the same customer base in a discount-driven market.

Amazon, Flipkart, and Swiggy did not respond to requests for comment. Eternal declined to comment, while Zepto stated it could not comment due to a silent period following its IPO filing.