Consumer Staples

Q-Commerce, Only The Best Will Remain

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<p style="text-align: justify;">Last week in the European market, Gorillas, Getir, and Zapp, the quick delivery services, announced that they urgently needed cost cuts.</p><p style="text-align: justify;">Throughout the last 18 months and after the worst moments of the pandemic, we have been observing with a mixture of amazement and admiration, the dizzying speed at which quick commerce companies or ultra-fast delivery, have grown.</p><p style="text-align: justify;">Under the premise of "growth first and profit later" and the support from the funds they had raised from the different financing rounds, these Q-commerce companies have been taking over the European streets, supported by massive advertising campaigns.</p><p style="text-align: justify;">But the economy has been getting complicated in the recent months; inflation and deterioration of the macroeconomic outlook has made the party much more onerous than expected.</p><p style="text-align: justify;">The first on-demand delivery service platforms to put the brakes, were the Germans at Gorillas. With a significant reduction in staff at their head office and exit from the markets of Belgium, Denmark, Italy, and Spain.</p><p style="text-align: justify;">The next day, Getir also had to accept that it had limits. One in seven jobs were eliminated, accounting for nearly 4,500 layoffs. Most of its expansion plans were scaled back, although Getir insists it does not want to abandon any markets.&nbsp;</p><p style="text-align: justify;">Getir is currently operating in France, Germany, Italy, Netherlands, Portugal, Spain, Turkey, United Kingdom, and United States.</p><p style="text-align: justify;">Shortly after, the British Q-commerce company Zapp also announced that one in ten jobs would disappear, which would mean about 250 redundancies. Here, the finger is pointed at the Ukraine war and global logistical problems.</p><h3 style="text-align: justify;"><span style="font-size: 12pt;">Europe, a complicated market for Q-commerce</span></h3><p style="text-align: justify;"><span style="font-size: 12pt;">"Fast &amp; Furious" is not just the title of the famous movie series, but a principle that is starting to permeate our shopping habits.</span></p><p style="text-align: justify;"><span style="font-size: 12pt;">Q-Commerce, which promises to deliver customer satisfaction in 30 minutes or less, is a clear conclusion to those needs.</span></p><p style="text-align: justify;"><span style="font-size: 12pt;">It is a market valued at $25 billion in 2021 globally and is expected to grow to $72 billion by 2025.</span></p><p style="text-align: justify;"><span style="font-size: 12pt;">Q-Commerce is a global phenomenon, which has led the emergence of 30 new companies in the last 10 months, only in Western Europe.</span></p><p style="text-align: justify;"><span style="font-size: 12pt;">Given that differentiation is complicated, since assortments, prices, and delivery times are similar, the key to being the best has been based on being the fastest to open a market. It seems that this speed has led some of the operators to make serious mistakes.</span></p><h3 style="text-align: justify;"><span style="font-size: 12pt;">Who will be the day after?</span></h3><p style="text-align: justify;"><span style="font-size: 12pt;">It seems that it is a market only for those who, in addition to having a good application and a good team, will need powerful financial muscle.</span></p><p style="text-align: justify;"><span style="font-size: 10pt;"><em>This article was contributed by our expert <a href="https://www.linkedin.com/in/javierperezdelezaeguiguren/">Javier P&eacute;rez de Leza Eguiguren</a>.</em></span></p><h3 style="text-align: justify;">&nbsp;</h3><h3 style="text-align: justify;"><span style="font-size: 18pt;">Frequently Asked Questions Answered by Javier P&eacute;rez de Leza Eguiguren</span></h3><h2><span style="font-size: 12pt;">1. What is Q-Commerce?</span></h2><p><span style="font-size: 12pt;">Quick commerce is the faster version of eCommerce. It is based on the &ldquo;on-demand delivery &ldquo;model.</span></p><h2><span style="font-size: 12pt;">2. What are the benefits of quick commerce?</span></h2><p style="text-align: justify;"><span style="font-size: 12pt;">It is much faster, Q-commerce companies deliver goods within an hour or two as compared to the conventional e-commerce model, where the delivery might take two to three or more days.</span></p><h2 style="text-align: justify;"><span style="font-size: 12pt;">3. How big is the Q commerce market?</span></h2><p style="text-align: justify;"><span style="font-size: 12pt;">Q-Commerce is a global phenomenon, thanks to which 30 new companies have emerged in the last 10 months, only in Western Europe. The market is valued at $25 billion in 2021 globally. It is expected to grow to $72 billion by 2025.</span></p><h2 style="text-align: justify;"><span style="font-size: 12pt;">4. What is the difference between e-commerce and Q-commerce?</span></h2><p style="text-align: justify;"><span style="font-size: 12pt;">The key difference between both models is the delivery time.</span></p><p style="text-align: justify;">&nbsp;</p>
KR Expert - Javier Perez de Leza Eguiguren