The growing demand for on-demand delivery is pushing brands to rethink how they forecast demand, stock across distributed locations, and execute last-mile fulfilment.
Atul Khichariya, Co-founder & COO, Velocity
The retail landscape for digital-first and direct-to-consumer (D2C) brands has undergone a transformation. What began with traditional e-commerce has quickly progressed to same-day delivery, and now to the era of instant gratification enabled by quick commerce. What was once considered a convenience has evolved into a non-negotiable consumer expectation. This shift is fundamentally reshaping how brands operate, plan, and manage their finances.
This behavioural change in how consumers shop has redefined core business fundamentals. It is impacting everything from supply chain operations to inventory planning and working capital allocation. The growing demand for on-demand delivery is pushing brands to rethink how they forecast demand, stock across distributed locations, and execute last-mile fulfilment. Speed is no longer a seasonal advantage. It is now a strategic imperative for brands looking to stay competitive in a fast-moving, customer-first market.
The numbers tell a compelling story. During festive seasons, e-commerce sales typically surge 25-30% year-on-year, but quick commerce is capturing an increasingly larger share of this growth. For digitally native brands in categories such as snacking, beauty, and gifting, quick commerce now represents 40-45% of total sales- showcasing exponential growth and opportunity.
To acquire customers and scale presence on quick commerce/e-commerce platforms, holding large inventories across multiple dark stores/intra-city warehouses, and larger distribution centres becomes critical for visibility and sales. The multi-tiered distribution requires additional planning and significantly more working capital.
The recent GST rationalisation, which simplified rate slabs and reduced tax burdens on several fast-moving consumer goods (FMCG) and essentials, has added momentum to the consumption story. Lower GST on certain categories has improved affordability and is expected to spur demand, which, in turn, further pressures brands to maintain deeper, wider inventory. While this is a positive for topline growth, it also increases working capital needs, especially for brands chasing higher velocity across geographies.
A significant share of sales on quick commerce platforms now comes from Tier-II and III cities. This is pushing brands to think about larger inventory requirements in these locations as well.
This geographic expansion amplifies the capital requirements, as brands must stock inventory in anticipation of demand patterns that may be less predictable than in established metro markets.
Many early-stage brands struggle at this stage, as the move to distributed inventory introduces new challenges across SKUs and business models. For instance, a fashion brand unable to meet real-time demand on quick commerce may lose consumer relevance, forcing it to liquidate excess stock on discount-heavy channels later. For categories with shorter shelf lives, such as F&B, unsold inventory doesn’t just hit margins but may result in outright losses.
With the festive season ongoing, brands are racing to meet surging demand and are seeking additional capital to keep up with the competition, acquire customers and brand re-call. At Velocity, we have noticed a 40% increase in average loan ticket size from last quarter.
Brands don’t want to lose out. We are also seeing a 70% uptick in demand for financing quarter-on-quarter, compared to last year. The increase in customer seeking funds is to the tune of about 60%.
D2C and digital-first brand founders are willing to pay a premium for faster logistics, even outside of marketplaces. Many are building fulfilment networks across cities and tying up with shipping aggregation platforms and third-party logistics providers to mirror the quick commerce experience on their own websites.
Inventory financing has emerged as a critical enabler in this new operating environment. It allows brands to unlock capital tied up in stock without draining liquidity. Brands are now securing larger working capital loans with extended repayment tenures, anticipating that festive demand cycles will play out over longer periods. Higher inventory financing enables deeper stocking across SKUs to match unpredictable consumer behaviour, faster fulfilment from local hubs instead of centralised warehouses, agility to scale during high-demand seasons or festival peaks and working capital preservation for marketing, customer acquisition, and operations.
Inventory financing, therefore, is evolving from a tactical funding tool to a strategic enabler. Companies are willing to pay premiums for faster logistics and deeper stock coverage because the competitive advantages outweigh the costs.
Alongside capital, technology is powering this shift. Brands are increasingly deploying AI to drive operational efficiency, enhance customer experience, and unlock profitability. AI powered solutions across funnels are helping brands with improved customer experiences and reduce operational friction directly impacting revenue, margins and profitability.
The quick commerce revolution represents one of the most significant shifts in retail operations in decades. The businesses that recognise this transformation as strategic rather than operational will be best positioned to capitalise on the opportunities ahead. As consumer expectations continue to evolve, the ability to deliver instant gratification while maintaining financial discipline will separate market leaders from the rest.
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