India's Quick Commerce Landscape to Transform with 5,000+ Dark Stores by FY26: Report By 2027–28, dark stores are projected to achieve a gross order value of $35 billion to $40 billion.

The quick commerce industry in India is entering a new phase of evolution, poised for significant growth while balancing expansion with profitability. According to a recent report by HSBC Global Research, the sector, driven by major players like Blinkit, Zepto, and Swiggy's Instamart, is expected to operate 5,000–5,500 dark stores by the fiscal year 2025–26. By 2027–28, it is projected to achieve a gross order value of $35 billion to $40 billion. A dark store is a retail outlet or distribution centre that exists exclusively for online shopping and is generally a large warehouse.

The expansion strategies of leading players in the q-commerce industry have always been a major talking point. Blinkit, Zomato's quick commerce arm, has already surpassed 1,000 operational stores as of the December quarter of the 2024–25 financial year and aims to double that by the end of the fiscal year. The company added another 216 stores in just one quarter, a testament to its aggressive approach. Meanwhile, Zepto's network has swelled to 850 stores, with a milestone of 1,000 stores well within reach this year. Swiggy's Instamart is similarly on track to join the 1,000-store club.

Despite these remarkable achievements, HSBC's report indicates that the period of hyper-expansion may soon give way to a more measured approach. "We believe leading companies like Zepto will focus on optimising capacities after reaching 1,000 stores, while Blinkit and Swiggy are expected to moderate their expansion plans," the report states. By the end of fiscal 2024–25, the sector's store capacity is expected to meet projected throughput demands for 2027–28, signaling a slowdown in new store launches.

The shift is both strategic and necessary. The breakneck pace of expansion has come at a cost, with profitability taking a significant hit. Blinkit, for instance, attributed a considerable portion of its losses in the December quarter to the expenses incurred from opening new stores.

The report from HSBC anticipates that a moderation in store additions will allow these companies to turn their attention toward optimising existing operations. This pivot is likely to refine supply chain efficiency, all the while improving delivery timelines and reducing operational costs; all critical steps toward achieving sustainable profitability.

This recalibration of strategy has broader implications for the competitive landscape. While the market's potential remains immense, the emphasis on profitability over market share could lead to greater consolidation and a sharper focus on customer retention through service quality. Companies that can strike the right balance between growth and operational excellence are expected to emerge as the frontrunners in this evolving market.

The report also highlighted the short-term financial challenges that the sector may face. The March quarter of fiscal 2024–25 is likely to reflect the strains of aggressive expansion, but a turnaround is anticipated in the subsequent quarters. As the industry stabilises, quick commerce players are expected to deliver improved margins and create more sustainable business models.

For now, the quick commerce industry in India remains a dynamic and rapidly growing space, yet, as it matures, a more calculated approach is taking hold.