Zomato, Swiggy face antitrust heat over deep discounts in quick commerce

India’s quick commerce giants, Zomato’s Blinkit, Swiggy’s Instamart, and Zepto are under scrutiny after the All India Consumer Products Distributors Federation (AICPDF) filed an antitrust complaint alleging deep discounting practices. The Competition Commission of India (CCI) has been urged to investigate these platforms, which have rapidly expanded their network of neighborhood warehouses to meet the surging demand for 10-minute deliveries.

Retailers struggle against aggressive pricing

The AICPDF, which represents 400,000 distributors supplying brands like Nestlé, Unilever, and Tata to 13 million retail stores, claims that quick commerce firms are pricing traditional retailers out of the market. The federation compared online and offline prices of 25 consumer products, revealing significant gaps. For instance, a Nescafé coffee jar that small retailers procure for around Rs 622 is sold for just Rs 514 on Zepto and Rs 577 on Swiggy Instamart, making it nearly impossible for brick-and-mortar stores to compete. 

Regulatory scrutiny mounts on quick commerce

The complaint comes as the CCI already investigates Zomato and Swiggy over alleged unfair practices in their food delivery businesses. A similar probe last year found that Amazon and Flipkart favored select sellers and engaged in predatory pricing, although both companies denied wrongdoing. The new case against quick commerce platforms could lead to stricter regulations, requiring them to justify their pricing strategies.

Booming market attracts competition

Despite the regulatory heat, India’s quick commerce market is booming. Bernstein estimates it will grow from $200 million in 2021 to $35 billion by 2030. Blinkit leads with a 40% market share and over 1,000 warehouses, followed by Zepto (29%) and Swiggy Instamart (26%). Reliance’s JioMart, Amazon, and Flipkart are also exploring the space, intensifying competition.

With Zepto eyeing an IPO at a $5 billion valuation, and growing concerns about fair competition, the coming months could shape the future of quick commerce in India. If CCI orders an investigation, the process could take months, potentially reshaping pricing policies in the sector.