Ola to join quick commerce business, to compete with Blinkit and Zepto: Report

Ola may join Blinkit and Zepto in the quick commerce sector as it prepares to get listed this week, according to a report by the Economic Times (ET) citing sources. This will be Ola’s second attempt at the quick commerce business.

ANI Technologies, Ola’s parent company, plans to establish its own dark stores due to increasing demand for quick delivery services, the report said.

Dark stores are small retail warehouses where goods are stored for rapid deliveries. These dark stores will be operated by Ola and robots will be installed to reduce human involvement in the process, per the ET report.

“It's a dark store as a service where the whole setup will be delivered with significant automation but there will be some people involved,” the report cited a source. “A few of these initiatives will be displayed as part of Ola’s future roadmap for the next year at a time when the ride-hailing business has plateaued,” it added.

Along with dark stores, Ola also plans to introduce its own Unified Payments Interface (UPI) for its customers.

The new initiative will be introduced by CEO Bhavish Aggarwal at the company’s annual Independence Day celebration on August 15. These plans may have some changes, the report said.

Mint could not independently verify the development.

Competitors

ET also mentions that Blinkit, a Zomato-owned quick commerce company, has plans to have 2,000 dark stores by the end of 2026 from the 639 in Q1. Zepto will double the total dark store count to 700 by March 2025 compared with 1,000 for Blinkit in the same time period. Swiggy's Instamart is also scouting for for new dark stores across the country.

“This is another attempt from Ola to ride the quick commerce wave after it had launched Ola Dash as an end-to-end quick commerce service and shut it in 2022,” ET reported quoting sources. “There is going to be a lot more demand for warehouses and better management given the demand for fast delivery for a majority of e-commerce segments,” it added.

Technology can help dark store management but it’s an operations-heavy business, the report said, stating another source. It’s not clear if Ola has conducted a pilot test. 

The ET report claimed that the plan is linked to the potential IPO of the ride-hailing business.

Previously, Ola had acquired Foodpanda in 2017 to diversify into food delivery but was unsuccessful and had to be shut down in two years.

The company is again entering a very competitive quick commerce sector, which has cash-rich players including Zepto and Blinkit by introducing its own dark stores.

“Ola is spending a lot of money on ONDC food delivery services. This will remain a focus area for the new commerce business under ANI Technologies,” ET quoted a source.

On the payments front, the present UPI framework is dominated by PhonePe and Google Pay.

“It is likely to be through the UPI plug-in channel in partnership with banks because Ola parent ANI has not applied for any TPAP (third-party application provider) licence yet,” the report quoted a person aware of the matter as saying. Its own UPI offering can also be leveraged across the other businesses such as food and grocery delivery, as well as pick-up-and-drop services for goods.

ANI Technologies reported a ₹1,082 crore loss in FY23, which is about a third of the year before. Revenue grew 58% to ₹2,135 crore.

The new development comes amid the initial public offering of Ola Electric that hit the D-Street on Friday, August 2. The company's total market value is expected to be around ₹33,500 crore.