Quick Commerce and Medicine Delivery in India
If done well, Swiggy’s partnership with PharmEasy for 10-minute medicine delivery has the potential to reshape healthcare accessibility in India, demonstrating the promise of quick commerce.
Last week, you must have read the news about Swiggy collaborating with PharmEasy to include medicine delivery into their quick commerce or Instamart service. This will ensure that medicines are now available within 10 mins when ordered either on the PharmEasy or the Swiggy app. This partnership between Swiggy and PharmEasy marks a significant evolution in the healthcare and e-commerce sectors, with promising implications for accessibility and convenience.
Is this a game changer in a market where the satraps controlling medicine distribution did precious little to evolve the process, and instead resorted to slinging mud on those who did?
Quick commerce brings a level of immediacy and convenience previously unseen in India’s pharmaceutical sector. Through Swiggy’s existing logistics network and PharmEasy’s pharmaceutical expertise, patients can access medicines within 10 minutes, addressing critical needs, especially in emergencies where every minute counts.
This could be a game-changer for India, where distance and time constraints can delay access to essential medications. Urban areas with congested traffic or a limited number of pharmacies open 24/7 would benefit especially from this initiative. The rapid delivery model could also support patients who lack the physical mobility to visit pharmacies.
In addition to convenience, this partnership could set a standard for technological integration and inventory management in the healthcare sector. Quick commerce relies on advanced logistics, predictive analytics, and well-positioned micro-warehouses close to consumer clusters to ensure that high-demand products are readily available.
If successful, the Swiggy-PharmEasy partnership could demonstrate the viability of this model, leading other companies to adopt similar approaches, enhancing competition, and further driving innovation.
Why Strong Players Like Amazon and Flipkart Struggle in Quick Commerce
Quick commerce requires a different logistical approach compared to traditional e-commerce. Amazon and Flipkart operate on a centralized warehousing model designed to fulfill large orders nationwide, which contrasts sharply with the decentralized micro-warehouse approach needed for 10-minute deliveries. Scaling up a micro-warehouse network across urban centers with high inventory turnover is a costly endeavour, which both companies have found difficult to justify against their primary operations.
Quick commerce also has narrow profit margins, as the cost of infrastructure, warehousing, and rapid delivery systems significantly eats into profits. Amazon and Flipkart’s core business relies on economies of scale, while quick commerce demands local fulfillment and frequent restocking of small warehouses. This reduces profitability, especially when applied to a sector as sensitive as pharmaceuticals.
While groceries and food have seen success in quick commerce, Amazon and Flipkart may have faced difficulty in shifting consumer expectations for ultra-fast deliveries beyond these segments. Swiggy and PharmEasy, however, have developed the necessary market reach and have established trust within the respective domains of food and pharmaceuticals, positioning them more favourably for quick commerce in medicine delivery.
AIOCD’s take
The All India Organisation of Chemists and Druggists (AIOCD), representing traditional pharmacists, will likely raise concerns regarding the implications of this partnership.
1. Impact on Local Pharmacies: The rapid delivery model may divert customers from local brick-and-mortar pharmacies, affecting their revenue. Traditional pharmacists argue that quick commerce can lead to unfair competition, particularly for independent stores that lack the resources to compete with the efficiency and convenience of Swiggy’s 10-minute delivery model.
2. Concerns over Drug Quality and Safety: The AIOCD may voice apprehensions regarding the quality and safety of medicines delivered through quick commerce. Concerns over temperature-sensitive drugs and stringent storage requirements could emerge, as quick commerce logistics may not meet the strict regulatory standards required for certain pharmaceuticals. This could potentially impact drug efficacy, posing a health risk to consumers.
3. Regulatory and Ethical Concerns: Pharmacists play a vital role in advising customers about prescription drugs. Rapid delivery might limit this interaction, potentially increasing the risk of improper medication usage. The AIOCD might question whether quick commerce can adequately address the regulatory needs for dispensing prescription medications responsibly.
To counteract these challenges, the AIOCD could focus on lobbying for policy safeguards, such as strict delivery protocols for medicines, mandatory customer counseling services, or specific licensure requirements for delivery personnel handling medicines. Additionally, the AIOCD could explore partnerships with local delivery services or invest in their own technology platforms to modernize their operations, blending the advantages of local pharmacy expertise with the convenience of quick commerce.
Will this development become big enough to be regulated? Or will it stay a blip on the drug distribution radar? I think it has the potential to become big in a few years. Hence, the emergence of quick commerce in medicine delivery will likely prompt regulatory responses aimed at ensuring public safety while allowing innovation.
Regulatory bodies like the Drug Controller General of India (DCGI) could introduce standards for the handling, storage, and delivery of pharmaceuticals, particularly for temperature-sensitive medications. These regulations could mandate micro-warehouses to adhere to certain protocols, which may include temperature control, time-sensitive packaging, and verification steps for prescription drugs.
Additionally, there might be a requirement for delivery personnel to undergo training or certification to safely handle and transport pharmaceuticals. Regulatory bodies could also consider policies that mandate customer identity verification upon delivery, particularly for restricted medicines. Such policies would protect consumers while allowing the quick commerce model to flourish within a controlled framework.
If done well, Swiggy’s partnership with PharmEasy for 10-minute medicine delivery has the potential to reshape healthcare accessibility in India, demonstrating the promise of quick commerce in addressing urgent medical needs. Both these companies are better positioned to leverage their expertise in logistics and healthcare to provide this essential service.
If executed with adequate oversight, this partnership could set new standards for healthcare delivery in India, making critical medicines accessible faster and more reliably than ever before.