Flipkart and Amazon ramp up pressure on India's quick-commerce sector

Flipkart, an e-commerce company owned by Walmart, has crossed more than 800 dark stores—distribution centers for online shopping—and is looking to double its dark store count by the end of 2026, according to financial services firm UBS. The expansion accelerates Flipkart’s push into India’s quick commerce market, a retail model offering fast delivery of goods, which the company entered in August 2024. This rapid expansion is shifting the sector away from its early phase. According to Ankur Bisen, senior partner at retail consultancy Technopak Advisors, “Quick commerce is no longer in a startup phase — it has become a big players’ game.” More than 6,000 dark stores are now in operation across India. The scale of the major networks highlights this consolidation:

• Blinkit: The market leader, owned by Eternal, operates over 2,200 dark stores and plans to scale to 3,000 dark stores.
• Flipkart: Now operates more than 800 dark stores.
• Amazon: Entered the market in late 2024 and has rolled out around 450 to 500 dark stores, with about 330 to 370 currently operational, according to UBS.

While the model is currently viable in about 125 cities, profitability remains concentrated in major metropolitan areas. Aditya Soman, a senior research analyst at CLSA, a Hong Kong-based brokerage, noted that dark stores typically take six to 12 months to reach maturity. Over 3,800 dark stores are located in the top eight cities, with about 3,600 of them potentially profitable. Karan Taurani, executive vice president at Elara Capital, a London-headquartered investment bank and brokerage firm, explained that metropolitan markets yield better profitability due to higher throughput, which refers to the volume of orders processed. However, Flipkart is betting on smaller towns to drive future growth. Satish Meena, founder of Gurugram-based consumer insights firm Datum Intelligence, noted that Flipkart carries Walmart’s DNA, which focuses on expanding the total addressable opportunity to dominate by growing the market. Flipkart already draws 25% to 30% of its quick-commerce orders from small towns, with orders per dark store growing about 25% month-on-month. Meena added that smaller towns could experience a surge if companies expand beyond groceries to offer a wider range of items at faster speeds.

This expansion is pressuring incumbents. Flipkart is offering discounts of around 23% to 24% across categories, according to an analysis of a sample basket by financial services firm Jefferies. Brokerage firm JM Financial reported that Swiggy’s quick-commerce business is caught in a growth-versus-profitability deadlock. Consequently, share prices for Eternal, the parent company of Blinkit, are down about 15%, while Swiggy’s share price has fallen over 29%.

Why it matters

The entry and expansion of large players such as Flipkart and Amazon are reshaping the competitive landscape of India’s quick-commerce sector. This shift is forcing incumbents to reassess their strategies amid rising competition and costs.