Qcommerce

Quick Commerce to Outpace Indian Railways in Job Creation: Zepto Founder Aadit Palicha

• ByStartupStory     |    November 23, 2024

In a recent interview with Moneycontrol, Aadith Palicha, the founder of Zepto, dismissed concerns that quick commerce platforms negatively impact traditional kirana stores. Instead, he emphasized the industry’s contribution to job creation and economic growth.

Palicha argued that the belief that platforms like Zepto, Blinkit, BigBasket, and Instamart harm kirana stores is a “data-free narrative” and “anecdotal” at best. Supporting his stance with data from the Confederation of All India Traders (CAIT), Palicha stated, “According to it, $46 billion was added to grocery and household consumption goods from financial years 2022-23 and 2023-24. Of the $46 billion added, less than $5 billion belonged to quick commerce platforms. According to Palicha, the rest, $41 billion, belonged to kirana stores.”

He elaborated, “Their own data shows that it’s impossible for quick commerce to have caused kirana stores to shrink.”

Addressing Predatory Pricing Concerns

Palicha also responded to allegations of predatory pricing, asserting that only 0.2% of Zepto’s products were sold below cost in FY24. He attributed Zepto’s ability to offer competitive prices to structural efficiencies in the supply chain.

“We’ve created structurally deflationary value, we have cut out all the inefficient middlemen that exist in the value chain of groceries, the distributor, the wholesaler, we go straight to the manufacturer,” Palicha explained.

Emphasizing profitability as evidence against predatory pricing, he added, “We’ve structurally reduced the price, we’ve been able to turn ourselves profitable and that means we are not predatory pricing, we’re actually deflationary.”

Significant Job Creation

Highlighting the industry’s role in employment generation, Palicha revealed that Zepto alone has created 1.5 lakh jobs, with the quick commerce sector as a whole generating 4.5 lakh jobs. “We’ve added 25,000 jobs in the past 90 days, delivery partners, pickers and packers, truck drivers, packagers for fruits and vegetables, local entrepreneurs in shops etc,” he said.

He further noted that the average wage for jobs created by Zepto stands at ₹23,200, adding, “Quick commerce will generate more jobs than the Indian Railways would do in the next 2-3 years, which we should celebrate.”

Expanding Operations

Palicha also mentioned Zepto’s plans for expansion, pointing out an increase in capital expenditures. The company’s growth reflects the broader momentum of the quick commerce industry, which Palicha believes is a significant contributor to the economy.

The quick commerce sector continues to be a hotbed of innovation and employment opportunities, with Zepto leading the charge. By addressing key concerns and demonstrating tangible benefits, Palicha’s insights shed light on the transformative potential of this burgeoning industry.

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