UK QUICK E-COMMERCE (QUICK COMMERCE) MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2023 - 2030)

The UK Quick E-Commerce (quick commerce) market size was valued at US$ 6.21 billion in 2023 and is expected to reach US$ 21.48 billion by 2030, grow at a compound annual growth rate (CAGR) of 19.4% from 2023 to 2030. Quick commerce refers to the ultrafast delivery of groceries and other daily essentials in as fast as 10-30 minutes. It involves setting up micro-fulfillment centers called dark stores in urban areas to enable faster deliveries. The key advantage of quick commerce is convenience and meeting instant gratification needs of time-pressed urban consumers.

The growth will be driven by busy lifestyles of consumers, need for instant delivery, and rising smartphone penetration in the UK.

The UK Quick E-Commerce (quick commerce) Market is segmented by product category, order size, delivery time, payment method, and business model. By product category, the market is segmented into fresh food & groceries, prepared meals, snacks & desserts, beverages, personal care & household, and others. The fresh food & groceries segment is expected to dominate the market due to high demand for quick deliveries of fresh fruits, vegetables, dairy items, and other daily essentials.

UK Quick E-Commerce (quick commerce) Market Drivers:

• Busy lifestyles and need for convenience: The busy lifestyles of today's consumers is a major driver of the quick commerce market in the UK. British consumers, especially working professionals and dual-income households, have less time for grocery shopping and cooking. Quick commerce apps solve this by delivering fresh foods, ready-to-eat meals, and other essentials in 10-30 minutes. For time-pressed urban consumers, the convenience and speed of quick commerce is highly appealing.
• Rising smartphone and internet penetration:
• Surging smartphone and internet access is enabling quick commerce services to reach a wider segment of consumers in the UK. According to statistics, 91% of adults in the UK own a smartphone in 2022. High mobile penetration coupled with fast 4G networks allow consumers to conveniently order essentials via quick commerce apps. The apps provide easy discoverability and one-click ordering for fast deliveries.
• Generational shift and tech-savvy millennials: Tech-savvy millennials who are digital natives and rely heavily on on-demand services are an important demographic driving adoption of quick commerce apps in the UK. According to a survey, 75% of millennials have used quick commerce apps to order groceries and essentials. Millennials value the convenience and speed offered by quick commerce players.
• Venture capital investments: Quick commerce startups like Dija, Getir, Fancy, etc. have received strong venture capital investments in the UK over the past few years. These investments are enabling startups to expand their dark store networks and technological capabilities. Well-funded companies are spending aggressively on marketing and promotions to acquire customers. Increased funding provides a strong impetus for growth.

UK Quick E-Commerce (quick commerce) Market Opportunities:

• New geographic expansion: Quick commerce companies have tremendous opportunities for expansion into new cities and regions in the UK beyond London and other big metro areas. Companies can launch services in suburban areas and smaller towns with convenience-seeking consumers. Investing in geographic expansion will help broaden the addressable market.
• Partnerships with restaurants: Quick commerce apps can provide additional revenue channels for restaurants struggling with dine-in restrictions. Partnerships allow restaurants to prepare meals from their kitchens for quick delivery by apps. This gives consumers access to a greater variety of freshly prepared meals. Such win-win partnerships present an important opportunity.
• Delivery of non-food items: Currently quick commerce apps mainly focus on grocery, fresh foods and meals. However, companies have the opportunity to leverage their ultrafast logistics to deliver other consumer items like pharmacy, electronics, and more. Expanding offerings can drive higher order values and customer loyalty.
• Green delivery through EVs: As sustainability becomes more important, quick commerce apps can integrate electric vehicles and eco-friendly practices into their logistics. EV delivery services enable companies to reduce their carbon footprint. This can appeal to environment-conscious millennials and Gen Z consumers.

UK Quick E-Commerce (quick commerce) Market Trends:

• Data analytics and AI: The use of data analytics and AI is an important trend in quick commerce. Companies leverage data to optimize routing, inventory, and demand forecasting. Predictive analytics and machine learning improve ETAs and inventory management within dark stores. AI chatbots also simplify customer interactions.
• Focus on dark store locations: Optimal dark store locations are critical for successful quick deliveries. Quick commerce apps are using data and analytics to identify high-density residential areas and set up micro-fulfillment centers. Proximity to customers ensures speed and convenience.
• Sustainable packaging: Consumers are increasingly conscious about sustainability. Quick commerce apps are adopting recycled, reusable, and eco-friendly packaging for deliveries rather than single-use plastics. Sustainable packaging minimizes waste and appeals to environmentally-minded consumers.
• Integration with e-commerce platforms: Quick commerce apps are exploring integrations with existing e-commerce platforms like online grocery apps. This can enable consumers to get faster deliveries for a wider range of products beyond just what is available in micro-fulfillment centers.

UK Quick E-Commerce (quick commerce) Market Restraints:

• Low margins and high operating costs: Quick commerce startups often operate on low margins as they spend heavily to acquire customers. High real estate costs for dark stores and rising last-mile delivery costs also strain profitability. Lack of unit economics threatens the viability and scalability of quick commerce apps.
• Intense competition: The quick commerce space has seen intensifying competition in the UK between heavily funded startups. Services are relatively easy to replicate. This creates price wars and excessive spending on promotions to acquire and retain users. Limited customer stickiness also aggravates churn.
• Government regulations: Quick commerce relies on gig workers for deliveries. Changes in government policies around rights and benefits for gig workers can impact operating models. Stricter regulations will raise costs, impacting viability.

Recent Developments

New product launches

• In January 2022, Getir launched its quick commerce services in London, UK. The launch marks the company's expansion in the European market beyond Turkey. Getir promises to deliver groceries and daily essentials within 10 minutes.
• In June 2021, Flink announced the launch of its services in London to establish dark stores enabling 10-minute deliveries. The launch strengthens Flink's presence in the UK.
• In March 2022, Gorillas launched its quick commerce app in New York City. The launch marked the Berlin-based start-up's U.S. expansion beyond metropolitan areas on the east and west coasts.

Acquisition and partnerships

• In March 2021, DoorDash announced it was acquiring Chowbotics, a maker of robotic food prep devices. This allows DoorDash to move into automated fresh food production for its dark stores.
• In June 2022, Getir acquired Gorillas in a $1.2 billion deal. The acquisition brings together two major players in instant commerce in Europe.
• In May 2022, Jokr partnered with UK supermarket chain Asda to offer on-demand grocery deliveries from Asda stores in London within 15 minutes.

Figure 1. UK Quick E-Commerce (quick commerce) Market Share (%), By Order Size, 2023

Top companies in UK Quick E-Commerce (quick commerce) Market

• Getir
• Gorillas
• Flink
• Zapp
• Jiffy
• Weezy
• Dija
• Fancy
• Weezy
• Zoom2U
• Deliveroo
• Just Eat
• Uber Eats
• DoorDash
• Stuart
• Gopuff
• Jokr
• Buyk
• Cajoo
• Everli

Definition: The UK quick commerce market refers to the segment of e-commerce focused on delivery of groceries and daily essentials to customers in shortest possible time ranging from 10 minutes to an hour. Quick commerce enables urban consumers to order daily essentials and groceries from nearby micro-fulfillment centers and receive them in minutes. It solves the pain point of long waits for online deliveries. Key players operate via dedicated mobile apps and dark stores.

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