Quick Commerce

E-commerce surveys consistently find that repeat customers are closely associated with positive delivery experiences, which shows how logistics providers now act as key differentiators among online marketplaces and platforms. Therefore, supply chain teams must analyze customer expectations and adjust strategies and operations to meet them. That is why quick commerce is the ultimate discipline for designing an outstanding end-to-end customer experience.

An analysis of end-customer data by instant-delivery startup Ohi found that orders delivered within 2 hours had a 61% higher repurchase rate than standard shipping and even 24% higher than same-day delivery.

Implementing a seamless, hassle-free online shopping experience within a time span of one hour from order to delivery helps companies build customer retention and loyalty. The switch to quick commerce, however, carries risk that should not be underestimated. The transition is costly and, once a company promises to meet the customer expectation of hassle-free delivery within an hour, failure to deliver on that promise risks loss of business, competitiveness, and relevance.

In addition to fast, on-time delivery, most customers today also demand live shipment status tracking and updates. The ability to track the path of the quick commerce delivery from goods packing in the dark store to the mapped delivery destination adds to a positive customer experience, involving the recipient virtually with their order in the supply chain. Logistics providers can facilitate this through efficient inventory control, effective demand forecasting, optimized delivery routes, the installation of sensors, and other digitalization tactics.

Quick commerce providers currently specialize in delivering food and groceries, but some are expanding into other fast-moving consumer goods (FMCG) like beauty products, clothes, and office supplies. Japanese fashion and home goods company MUJI, for instance, is a frontrunner in this space, partnering in 2022 with Meituan, China's leading food delivery shopping platform, to offer instant delivery services within China for its product line, from fashion items to kitchen appliances.

We here at DHL anticipate a future where most FMCG retailers and even companies providing many luxury and specialized goods, like expensive handbags and large furniture, will offer quick commerce options to customers. With this rising trend, retailers will have two possible strategies to stay competitive. They can either follow MUJI’s example and partner with an existing quick commerce provider or create their own in-house fast-delivery solution. In both scenarios, as more and more different product types are offered for delivery in shorter time spans, supply chain teams must anticipate how their supply chains will change not just in the last-mile, but also in upstream supply chain segments as well, to accommodate quick commerce.