The race for distribution between Indian food launches carries road safety risks, Reuters said

By Aditya Kalra and Abhirup Roy

NEW DELHI (Reuters) – Indian food launches are attracting technology-savvy customers within 10 minutes, sparking a “fast trade” boom, but raising concerns about road safety as cyclists struggle to meet tight deadlines.

There is already fierce competition between India’s $ 600 billion retail food industry, Amazon (NASDAQ :), Walmart (NYSE 🙂 Flipkart and India’s Mukesh Ambani’s Reliance.

Now SoftBank-sponsored Blinkit and its rival Zepto are in the process of hiring staff and opening stores to gain a market share, offering the convenience of delivery in 10 minutes, much less than the hours or days it takes competitors.

Their mission is to pack their food in a few minutes in so-called dark shops or in small buildings in suburban buildings, and send cyclists to nearby places for about seven minutes.

“It’s a threat to big players,” Ashwin Mehta, India’s chief IT sector analyst at Ambit Capital, told Reuters. “If people get used to 10 minutes, those companies that offer 24-hour deliveries will be forced to cut down on time.”

As activity grows, research firm RedSeer says India’s fast-growing trade sector, valued at $ 300 million last year, will grow 10-15 times by $ 5 billion by 2025.

Launched by two 19-year-old Stanford students, Blinkit and Zepto have captured the minds of consumers to satisfy their cravings for food and boost shopping, as well as the urgent needs of daily supplies.

“This is very convenient, it’s made a lifestyle change,” Sharmistha Lahiri said, and now she’s turning to Blinkit to fill the gap in her kitchen when the ingredients suddenly run out, for tomatoes for soup and chocolate ice cream for a cake.

The 75-year-old, who lives in Gurugram near New Delhi, was an avid user of the Amazon and India conglomerate’s BigBasket network retailer, but Blinkit’s quick response is rewarding in such situations.

The unparalleled convenience of fast shipping is evident in Europe and the United States, where companies like Turkey’s Getir and Germany’s Gorilla are rapidly expanding, but India’s accident-prone roads are turning fast trade into a risky business.

“Ten minutes is very demanding,” Vijay Chhibber, a former road secretary, said. “If there was a (road safety) regulator, it would say that this cannot be the only selling point for a company.”

Blinkit and Zepto did not answer Reuters’ questions.

ROAD RISKS, DRIVER’S BOXES

Even in cities, most roads are full of potholes, and animals or other animals that travel in traffic are often challenged by motorcyclists, who often violate basic rules.

Last year, the World Bank said India had one death on its roads every four minutes. Accidents kill about 150,000 people every year.

Reuters interviewed all 13 Blinkit and Zepto drivers in key cities in Mumbai, New Delhi and Gurugram, saying they were under pressure to meet delivery deadlines, which often led to speeding up, fearing shoplifting by officials.

“We arrive five or six minutes away and I feel tension and fear for my life,” said a Blinkit driver, who was seeking anonymity.

In August, Blinkit’s chief executive said on Twitter (NYSE 🙂 that cyclists were not penalized and could be given “at their own pace and pace” because the dark shops are always close to the destination sites.

Senders disagree. In their rush, many of them told Reuters that the orders were delivered even before they reached their destination.

And if a customer complained about the practice, they had to pay a penalty of 300 Indian rupees ($ 4.03). A screenshot of the Blinkit application provided by a driver showed the term MDND or “Marked Delivered, Not Delivered” used to name these items.

Frustration also appeared in an interview with a WhatsApp group of Blinkit cyclists in Mumbai, reviewed by Reuters.

“Prohibit this 10 minute (delivery),” said one user after posting photos of a cyclist who was said to be injured at a deadline.

Concerns reflect the dark side of India’s economic boom, in which workers often say they feel inadequate or struggling with harsh working conditions.

WIZARD

Blinkit calls its service “inseparable from magic” and says it wants to turn it into a $ 100,000 billion business.

Zepto has been valued at $ 570 million and is set to become a $ 20 billion business, already backed by investors like Glade Brook Capital in the US.

The immediate delivery market is worth $ 50 billion, India’s largest offline retailer, Reliance, said this month, when it invested in Dunzo, another Indian startup that runs a 19-minute delivery service.

But unlike most foreign companies that charge $ 1 and $ 3 for shipping, Indian startups are mostly free in a nation with 1.4 billion potential customers.

“With free shipping, the business is unlikely to be viable,” said TN Hari, BigBasket’s head of online food resources, who handles most orders within five hours.

“And with a delivery quota that makes it viable, it’s likely to be a small market size.”

For now, the Indians are hooked.

On New Year’s Eve, more than 43,000 soft drinks were shipped, a Blinkit investor said on Twitter, “33,440 condoms were ordered today on @letsblinkit. Someone ordered 80 condoms at a time.”