Like every year, e-commerce firms will ramp up their workforce in terms of delivery personnel and contractual staff to meet the forthcoming festival season rush. However, analysts said the growth of quick commerce platforms will ensure that the demand for these staff will continue beyond the festival season.
The top three q-commerce companies (Zepto, Swiggy Instamart, Blinkit) have around 50,000 contractual staff between them and anywhere in the range of 400,000-500,000 delivery partners. According to TeamLease Services, this workforce is expected to expand by at least 20-50% over the next 2-3 months. “While this may not remain at the same level by the end of this year, the steady state order volumes will be higher by the end of the festive season. Thus, a bare minimum steady-state growth of 25% is expected on this workforce,” Balasubramanian A, senior VP and business head, TeamLease Services said.
While the festive season leads to a spike in hiring, the sustainability of this growth in employment levels post festive season has always remained a question. Historically, many companies have scaled back their workforce after the peak season. “However, the current landscape of q-commerce suggests a potential shift. This could lead to a more stable employment environment, particularly if companies continue to expand their services and operational capacities,” Somdutta Singh, e-commerce expert and an angel Investor said.
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Reports indicate that q-commerce is experiencing a remarkable growth trajectory, with a GMV growth rate of 77% year-on-year despite broader economic challenges. The industry is projected to maintain a CAGR of 40-45% over the next three years. Top quick commerce players including Zepto, Blinkit, BBNow and Swiggy Instamart are thus expanding to newer categories, and geographies and scaling up dark stores. The industry has also seen players such as Flipkart, Ola enter the space to cash in on the demand.
Earlier in the year, the top three quick commerce companies managed to touch a peak of 2 million combined orders on the day of Holi. That was a new high then. Now, around Raksha Bandhan, q-com hit record sales and grew several times over their previous year’s corresponding order volumes on the same occasion. Based on the analysis of the sales boom during Raksha Bandhan and projections for upcoming festivals like Diwali, not just for Diwali, but for the entire festive season, they are looking at a significant ramp-up ranging from 20-50% depending on the geography.
Experts expect the overall online retail demand to see a spike of 30-40% this festive season. With this, there is also a strong possibility of an increase in earnings for delivery partners during and beyond this festive season. “They have an opportunity to deliver more orders, and hence earn more incentives. The incentives will also be tweaked on special days motivating them to stick to one platform as much as possible and do more deliveries to get more incentives accrued to them,” Balasubramanian said.
Companies may also offer higher wages or bonuses to attract and retain delivery personnel during this busy period and later. “As the sector matures and companies strive for profitability, there could be a long-term trend towards better pay and benefits for delivery partners,” Singh added.
From: financialexpress
Financial News
