Blinkit CEO Cautions Rivals That Its Profitability Playbook Can't be Copied

Quick commerce platforms have created buzz about burning cash amid heightened competition and rapid expansion plans. While market giants like Swiggy Instamart and Zomato-owned Blinkit reported losses in the third quarter, they continue to offer deep discounts to capture the larger market share.

Despite losses, Blinkit turned profitable even before the July-September quarter. The new-age company saw its revenue more than double to Rs 1,156 crore in Q2FY25 as compared to Rs 505 crore during the same time period a year ago. The current financial picture of Blinkit and other market players raises questions on the profitability and sustainability of quick commerce game.

Blinkit CEO Albinder Dhindsa has recently spoke to The Economic Times about the company’s profitability and its competitors. Calling it a ‘misconception’, he said it’s not mandatory that if Blinkit has become profitable, then others can also do the same.

“There's a misperception that if we are profitable, others can be too. Small deviations in a low-margin business like ours can lead to vastly different outcomes...this isn’t a straightforward business. Perspectives will vary, but replicating the same approach to achieve identical results is nearly impossible,” Dhindsa told ET.

According to the Blinkit CEO, prioritising overall market share is not a sustainable approach for quick commerce players. He said the success of 10-minute delivery concept will depend upon right moves because the market is large and still at its early stage.

Read More | Changemakers 2024: Zomato, Blinkit and Deepinder Goyal’s Survival Instinct

Blinkit: Zomato’s Survival Instinct

Blinkit emerged as the crown jewel in Zomato’s expanding empire. Zomato CEO Deepinder Goyal acquired Blinkit in 2022, when the food delivery market had slowed and his core business was finding it difficult show profitability.

Goldman Sachs valued the quick commerce platform more than Zomato’s food delivery business. At an event recently, Goyal called his bet on Blinkit “survival instinct”. Zomato recorded profits at a consolidated level four quarters on a trot.

Read More | Blinkit Crosses 1,000 Dark Store Milestone As Quick Commerce Race Heats Up

Expansion Weighs on Blinkit’s Q3 Financials

Goyal’s bet on Blinkit proved to be a game-changer, but the company’s vast expansion plans to stay competitive in the market increased its losses. Blinkit reported an Ebitda loss of Rs 103 crore for the October-December period, significantly higher from a Rs 8 crore operating loss in Q2.

The numbers reflect that Zomato’s quick commerce arm is moving away from its guidance of staying breakeven in the near term. Additionally, it has also impacted Zomato’s overall profitability.

Read More | How Blinkit Captured Quick Commerce Market

Earlier, it had aimed for 1,000 dark stores by March 2025. However, Blinkit has already achieved the target way before its timeline i.e., it had 1,007 dark stores by December 31, 2024. Now, Dhindsa-led quick commerce company has set a target of 2,000 dark stores till December 2025.