Some sector I avoid as an angel !!
Why I refrain from investing in QC – never believe in Quick-Commerce?
QC pitch decks exorbitantly estimate their market size.
QC business model to achieve break-even requires two things to happen together:
- 1,000+ orders per day within 3 KMs radius.
And
- Customer’s who are impulsive as well as are not price sensitive
The above is true for any QC in India – including Blinkit Zepto and hundred other small players.
No QC business can be successful beyond metros and large towns in India – 70% of Indian population is living in small towns and villages.
Traditional kirana stores will survive and will keep growing.
Weekend family shopping trips for bulk discounts to DMart - Avenue Supermarts Ltd and Star Bazaar stores will keep happening.
Even in metros and large towns, middle class and lower economic sections of society don’t like QC –that’s 70% of Indian metro population.
So the real market size is 30% of 30% of Indian population.
Don’t blindly believe sexy QC pitch.
Do your own calculations.
According to me a product becomes successful if it is solving a user problem. In the case of QC it is solving several problems 1. Convenience at your fingertips 2. Time spent by the user Basically they have become your next door neighbour kirana stores. Having said this, it makes sense 1. if there is a certain population density in a certain area. ( will have to confirm that number) 2. AOV is more than Rs.450. Presently Blinkit has 625 as AOV. These numbers are possible only if we are catering to India 1 which is just 10-15%. Each of them can be as big as flipkart if they can cater just this target segment.