Blinkit faces disruptions at major warehouses amid festive demand surge
What's the story
India's leading quick commerce platform, Blinkit, is facing major disruptions at its large warehouses in Delhi, Mumbai, Bengaluru, and Haryana, according to The Economic Times. The problems stem from a surge in festive demand and the company's recent shift to an inventory-led model. To tackle these issues, Blinkit has temporarily halted accepting stocks for new and pre-launch products at its warehouses until October 31.
Capacity crunch
Blinkit's storage spaces are operating at full capacity
An email sent to sellers by Blinkit acknowledged the ongoing issues, saying, "Due to the ongoing festive season and high warehouse utilization, our storage spaces are operating at full capacity." The disruption has affected a number of sellers and brands on the platform who are now missing out on listing and selling key items for Diwali sales.
Impact on sales
Sellers express concerns over impact on Diwali sales
The warehouse disruptions have raised concerns among sellers. One of them said, "This is affecting our ability to sell seasonal items, especially for Diwali, which is a high-demand season." Another seller highlighted problems in sending goods to large Blinkit warehouses in Farukhnagar and Bengaluru over the past few weeks as delivery slots were filling up quickly.
Market share
Dark store network expanded ahead of festive season
Owned by Zomato parent Eternal, Blinkit commands over 50% of the market share. It competes with players like Zepto, Swiggy Instamart, Flipkart Minutes, and Amazon Now. The platform has been aggressively expanding its dark store network and now has around 1,700-1,800 micro-warehouses for 10-minute deliveries. This comes as other rivals have slowed down on their network expansion ahead of the festive season.
Model shift
Shift to inventory-led model has created challenges
Since September 1, Blinkit has been following a model where it buys goods from brands and sellers on the platform instead of acting as a marketplace. Nihaal Mariwala, founder of supplements brand Setu, said, "The inventory distribution policies had been somewhat fluid in the early days of the model."He added that fast-moving products are better distributed, but getting appointments to place new products in warehouses has been difficult lately.
Company response
Blinkit clarifies on product inwarding pause
A spokesperson for Blinkit said, "Every year, during the peak festive period, we pause new brand onboarding due to high warehouse utilization." They added that the pause on trial or launch-awaited product inwarding remains in effect till October 31, with regular operations resuming on November 1. Under this offering, brands list their products on the app in a particular cluster or city for a week.