Winning in smaller cities requires predictable buying patterns, clear value, low waste, and seamless supply chains
While quick commerce has taken off rapidly in urban India, especially in metros, it is yet to establish a strong foothold in smaller towns where adoption remains slow and uneven. Led by factors like dark store footprint expansion, selection growth and category diversification, the sector continues to grow at around 150 per cent year-on-year (YoY) during the first five months of this calendar year, as per a report by Redseer Strategy Consultants. However, with the devil lying in the details, this growth has another side to it as well.
Despite this growth and expansion of leading platforms to more than 100 cities, non-metro representatives of over 90 cities (excluding eight metros from over 100 quick commerce cities) contribute just over 20 per cent of QC gross merchandise value (GMV), the report noted. On the city segment mix front, the financial year 2025 (FY25) estimates show that the top eight metros’ contribution stood at around 83 to 85 per cent, while the remaining 92 cities contributed 15 to 17 per cent only.
Beyond the top 15 cities, dark stores handle fewer than 1,000 orders a day, dropping to just 350 to 700 in long-tail towns in May 2025, as emphasised by the report. The scale-up curve of a typical non-metro city (beyond the top 15) indicated that these cities tend to plateau out before the 1,000 OPD mark. The break-even dark store throughput in the smaller cities increases by 1.5 to 2 times versus metros. While players like Blinkit, Zepto and Instamart are adding dark stores, success beyond metros will require more than replication.
Demand Beyond Metros?
Given the huge gap between metros and non-metros, the gap in order volume suggests that current demand levels are not yet sufficient to support high-frequency, high-density operations in smaller cities, according to experts. The report also added that these cities have a higher representation of nascent users, who have poor digital maturity and trust, impacting the frequent usage of quick commerce.
“The demand exists. The question is shifting this demand from grocery stores to dark stores. So, yes, there is enough demand, but that will require deep discounting and aggressive advertising, resulting in significant cash burn. Given pressures on profitability, the question is whether this burn will be justifiable,” highlighted Alok Chawla, Founder and Chief Executive Officer (CEO), Kiko Live.
In tier three cities, success depends on going truly local. Experts noted that a one-size-fits-all model fails beyond the metros. Staying agile with smaller dark stores, flexible staffing, and adaptive pricing helps manage costs without compromising service. The report also highlighted that the tastes and preferences are extremely localised in these cities, and possibly, quick commerce selection is not representative of them yet.
“In tier three markets, one-size-fits-all fails fast. Every locality has its rhythms, festive peaks, preferred brands, and delivery windows. Here, the play is not time; it is variety and value for money. A broader, relevant portfolio improves basket size and builds repeat demand,” stated Anshu Jalora, Founder and Managing Director (MD), Sciative Solutions.
Chawla explained that operational agility of being able to restock inventory on time will also be important, as in smaller towns, it can take longer to replenish stocks. Jalora added that platforms must design nimble operations that flex with local needs, not override them.
Scaling Up In Smaller Cities
While the lack of demand maturity leads to lower average order values, the low demand city results in a larger delivery radius and higher delivery payouts. Experts noted that quick commerce in Bharat cannot be a copy-paste of metro models. Unlike metros, where high population density makes delivery more efficient, non-metros have sparse clusters, driving up the cost to serve. Jalora added that local retailer partnerships, dynamic pricing, and habit-forming loyalty programs will matter more than 10-minute deliveries.
“Success will depend on customising assortments to local preferences, optimising operations with smaller dark stores, and using spatial clustering to reduce delivery costs. Partnerships with local retailers, flexible delivery fee models, and hyper-local sourcing can help align supply with regional demand patterns and make operations leaner and more viable,” noted Somdutta Singh, Serial Entrepreneur, Founder and Chief Executive Officer (CEO), Assiduus Global.
Chawla explained that the challenge of insufficient population density per square kilometre will always be there, which will make the economics of having dark stores with huge stock-keeping unit (SKU) counts unviable.
Steep Ask Of Creating Profitable Play
Creating a profitable play in the smaller cities is a steep ask for quick commerce players. The report noted that there may be merit in rolling back a few of these cities and solving for the remaining ones in a deeper way. The report also explained that it is worthwhile to perform a prioritisation exercise across the city universe to arrive at a data-backed shortlist of the focus cities.
“For smaller cities, success means building predictable purchase patterns through strong value perception, low wastage, and lean supply chains. Quick commerce must evolve from novelty to necessity before sustainable unit economics can take root,” Jalora added.
In long-tail cities, trust plays a central role. Familiarity with the local convenience store adds comfort and perceived value to the transaction. Singh emphasised that to build a sustainable and profitable model, platforms must first grow user bases to support this scale across five to ten stores per city, with consistent order frequency and delivery efficiency.
As convenience alone does not trigger transactions, platforms must prioritise trust, utility, and thoughtful adoption over pure speed beyond metros. Experts noted that when local relevance meets operational agility, loyalty becomes the natural outcome. The next phase of quick commerce will not be won by speed alone. In India, trust, relevance and operational agility will determine who builds real loyalty.
