In today’s Finshots, we tell you why Amazon has entered quick commerce in India, at a time when competition in the space is fierce.

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Now, onto today’s story.

The Story

Amazon has announced its 10-minute delivery service, Amazon Now, in Mumbai. Now, this feels like a natural step after its launch in Bengaluru and Delhi a few months ago, where daily orders grew 25% month on month. And with 100-plus dark stores already in place and plans to add hundreds more by the end of the year, Amazon seems serious.

But here’s the catch. 2025 feels a little too late for a quick commerce debut in India. This is already a cut-throat game where players bleed cash to keep customers hooked. To give you a sense, average discounts have doubled in two years, from under 10% of MRP to 20-25% today.

And because of these heavy discounts, profit margins that are already razor-thin or even negative, are shrinking further. Numbers from the top two quick commerce players — both backed by listed parent companies, tell the story.

Take Zomato’s Blinkit, the market leader with a 52% share. Its revenues jumped 155% year-on-year (and 40% quarter-on-quarter) in Q1FY26 to ₹2,400 crores. But despite this surge, profits didn’t follow. Its operating losses swelled to ₹162 crores from just ₹3 crores a year ago. And if you break that down as a percentage of Net Order Value (NOV), Blinkit’s operating margin stood at -1.8%. In case you’re wondering, NOV is basically the total value of all orders after deducting fees and discounts.

Or look at Instamart, Swiggy’s arm with a 25% market share. Its revenues grew 113% YoY to ₹859 crores (and 17% QoQ). But operating losses ballooned to ₹896 crores, or nearly three times what it lost a year ago. And as a percentage of NOV, that’s a margin of -21%.

Which makes you wonder… why has Amazon shown up this late to the quick commerce party, especially now, when players are burning cash to hold their ground?

Let’s tackle the first question and talk about Amazon’s delay to begin with.

Look, Amazon is a retail giant as you know it. In India alone, it pulls in over ₹25,500 crores a year. So running a quick commerce business, even with initial losses, isn’t really a big deal. Its deep pockets mean the American parent can absorb those losses until things turn profitable. But timing was everything here.

When India’s quick commerce boomed, Amazon Inc. was wrestling with its own post-pandemic headaches. During Covid, profits doubled as people shopped online in droves. But Amazon simply couldn’t hire or build warehouses fast enough. And once the pandemic eased, shoppers flocked back to physical stores. Inflation didn’t help either as it made people more hesitant to spend.

And if you dig into Amazon’s financials, one particular year  — 2022 stands out. It was Amazon’s first unprofitable year since 2014. The culprit? A massive bet on electric vehicle maker Rivian. For context, Amazon took a 20% stake, seeing it as a way to electrify its delivery fleet and meet its climate pledge. It even committed to buying 1 lakh Rivian vans by 2030. But unfortunately for Amazon, that year Rivian stumbled. It priced cars poorly, missed growth targets, and its stock price crashed 82% in 2022, which also wiped billions off Amazon’s books.

That forced Amazon to slam the brakes on some projects. It paused growth at Amazon Go and Amazon Fresh, closed a few stores, froze hiring, and doubled down on businesses that made money like AWS and digital services.

And since Amazon’s India playbook is tied closely to decisions made in the US, quick commerce wasn’t exactly high on the agenda back then. The focus was survival and recovery.

But fast forward to today, Amazon has bounced back to profitability globally and steadied its ship. Which is why it probably feels ready to enter India’s quick commerce race, even if the party started without it.

Then there’s the matter of regulation. India has had strict FDI rules for e-commerce in place since 2016. So foreign-owned players like Amazon could not hold inventory or sell directly to customers. They had to stick to a “pure marketplace” model that simply connected buyers and sellers.

That upended Amazon’s playbook. It had to rethink how it pushed private labels like Solimo and Amazon Basics. And in that environment, building a direct quick commerce business was pretty much off the table. Sure, 100% FDI was still allowed in marketplaces, but the rules barred them from owning goods, fixing prices, or even letting one seller account for more than 25% of total sales. The idea was to level the field for smaller Indian businesses.

But Amazon and Walmart weren’t going to sit still. They worked around it through joint ventures with third-party sellers like Cloudtail (now closed) and Appario Retail (acquired by Clicktech in 2024), which gave them indirect control. It was technically legal, but always under scrutiny.

But now that those tie-ups have ended, Amazon has more room to set up dark stores for quick commerce, as long as it plays strictly by the marketplace rules.

And finally, there’s the late-mover advantage. Yup, you read that right.

You’d normally think that the first movers have the best shot at making it big and holding their ground in a crowded market. After all, that’s what the economics textbooks tell us. 

But an SPJIMR study points out that sometimes arriving late can actually be a blessing. And Amazon’s entry into quick commerce feels more like a calculated delay than a misstep.

See, while rivals were busy locking themselves into models that worked for an early market, Amazon got to sit back and watch. It’s seen how wafer-thin margins or even consistent losses broke the backs of well-funded players like Dunzo and JioMart Express. It’s seen how customer expectations shifted and where competitors have struggled. And now, it can build for the market as it is today — not as it used to be.

Plus, Amazon brings serious firepower. Its 200 million monthly active users dwarf Blinkit’s 13.7 million and Instamart’s 9.8 million. It can offer a seamless experience where shoppers flip between buying instant essentials and everything else they don’t need right away.

And unlike rivals who are busy chasing city crowds, Amazon has an edge. Its reach goes well beyond metros. Think of smaller towns where older folks still run the household and may not always be able to step out for essentials, especially with their children working in bigger cities. It’s only a matter of time before they get comfortable with quick commerce apps. And if most of them can already use WhatsApp, Facebook or pay through UPI, a simple, easy-to-use quick commerce app by Amazon could make that leap even easier.

Early signs look promising too. Amazon suggests that its Prime members have already tripled their shopping frequency after using Amazon Now. And if Amazon leans on quality and variety, not just speed, that could be its real edge.

But whether that’s enough to take on Blinkit, Instamart or Flipkart Minutes — backed by American giant Walmart, is something we’ll just have to wait and see.

Until then…

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