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Tuesday, February 11, 2025

Reliance’s Strategic Shift: Fast Deliveries Through Existing Infrastructure

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Reliance Industries is acknowledging the rising competition from quick commerce but is opting for a strategy that plays to its existing strengths. Instead of jumping into the race with dark stores, the company plans to use its established network of Reliance Smart outlets and kirana stores to drive faster deliveries, as per sources familiar with the company’s approach.

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According to a source, “We don’t need dark stores. Our Reliance Smart outlets and partnerships with local kiranas will serve as our base for faster deliveries.” The strategy focuses on keeping things lean, using a network of existing infrastructure to scale services across the country.

Unlike quick commerce rivals like Zepto, Zomato, and Swiggy, Reliance isn’t rushing to brand itself as a “quick commerce” player. They are avoiding promises of hyper-fast delivery windows on the Jio Mart app. Instead, the company is rolling out express and scheduled deliveries, with a focus on strong unit economics, capitalizing on its large-scale infrastructure to support these services. This also gives them an advantage in localizing selections, particularly in segments like fashion and value.

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While many view this shift as Reliance’s move to compete in the fast-paced delivery space, the company remains cautious. It has long been wary of the quick commerce model, with its high cash burn rates and thin margins. Despite challenges in revenue and product mix, Reliance Retail has successfully maintained its profitability.

However, this approach has come at a cost. Analysts from HSBC point out that while the company protected its margins, it did lose market share to quicker competitors, resulting in a decline in its valuation premium.

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