FMCG Firms Witness Significant Growth in Quick Commerce Sales Amid Changing Consumer Preferences

Leading FMCG companies have seen a significant rise in quick commerce's share of their e-commerce sales, according to a report by Deloitte and FICCI. This trend is expected to persist. Quick commerce, or hyperlocal delivery, now accounts for about 35% of online sales, becoming a popular choice for urban shoppers. Approximately 18% of consumers prefer buying food and beverages through these channels.

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The rapid growth of quick commerce, expanding by 230% from 2021 to 2023, is reshaping the landscape of last-mile logistics. This expansion is particularly evident in urban areas where demand for hyperlocal delivery is increasing. The report titled "SPURring growth in FMCG, retail and e-commerce sectors in India" highlights how this trend is disrupting traditional online grocery models like slotted and next-day deliveries.

Impact on Consumer Behaviour

Consumers in India are increasingly opting for e-commerce to purchase FMCG products. With internet access projected to reach 907 million users by 2023, online platforms now represent 17% of total FMCG consumption. This shift is largely due to the convenience, broader product range, and competitive pricing offered by online shopping.

The report notes that consumers often choose quick commerce over traditional e-commerce for food and beverages due to impulse buying or immediate needs. In contrast, items like home goods, beauty, and personal care products are typically planned purchases, making traditional e-commerce more suitable for these categories.

Changing Market Dynamics

Smaller households with both members working find the speed and convenience of quick commerce appealing. This service caters to their immediate and flexible consumption needs. Meanwhile, affluent consumers are gravitating towards premium products, prompting companies to focus on innovation-led new product development.

Rural markets are also showing signs of consumption growth. Companies are concentrating on expanding direct distribution reach and fostering habit formation to ensure sustainable long-term growth in these areas.

The report suggests that the surge in quick commerce will continue as consumers increasingly prefer Q-commerce channels for their purchases. This trend is prompting a reevaluation of existing consumption, production, and distribution models within the industry.