The company has launched this service in nine Indian cities through two-wheelers and the customer orders are picked up from local stores.
Currently, Uber offers only the delivery of items; the customer has to make payments directly to the store. Going forward, it plans to also collect payments from the customer on behalf of the stores, one of the people said.
The launch of Uber India’s store pickup service, which is already live in the US, comes on the back of the decline of Reliance Retail-backed Dunzo, which offered similar services. Last month, Walmart-backed PhonePe exited delivery of non-food categories it had offered via the ONDC network, while Ola restarted some of these services.
This also marks the entry of a global technology firm in India’s burgeoning quick-deliveries segment that has so far been commanded by Zomato-owned Blinkit, Nexus Venture Partners-backed Zepto and Swiggy’s Instamart.
Ecommerce marketplace Flipkart is also planning to enter the quick-commerce space. Companies such as Ola, Rapido and Porter offer on-demand pick up and drop services.
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“Uber is starting with delivery of prepaid items from neighbourhood kirana shops, departmental stores, pharmacies, and several other use cases…but the product will be expanded where it would collect from and make the payments on behalf of the customer to the shop,” the person said.A senior executive with a Gurugram-based firm that works with delivery and logistics companies said: “Quick-commerce platforms have had a clear impact on the buying behaviour of consumers. In the urban segments, the demand for these services is only rising, which makes it obvious that there’s space for newer players to enter the space.”
“Different companies are expected to take different approaches … some may choose to take the investment heavy dark store route, while some may augment the delivery layer. Uber is leveraging its existing two-wheeler fleet from its bike-taxi product,” the executive said.
ET reported in February that local kirana stores numbering around 12 million have witnessed an intensified slowdown in sales in the last quarter of 2023, even as quick-commerce firms gained market share for not just impulse products but also large packs of staples.
In response to queries from ET, an Uber spokesperson confirmed the development, saying the company has gone live with its store pickup service in Delhi-National Capital Region, Bengaluru, Chennai, Hyderabad, Jaipur, Lucknow, Kolkata, Guwahati and Ludhiana.
“Store pickups is a new addition to our package service where users can request an Uber driver to pick up the prepaid items from a store. Store pickups will give customers the option to pick any store in serviced areas so long as they share its location, and make the payment directly,” the spokesperson said.
Uber’s delivery plans
The San Francisco-based company’s India unit, which primarily operates in the ride-hailing space, has been recently upping its bets in the delivery space.
“The company takes highly data-backed decisions…any project or experiment being conducted is only taken forward if it continues to show signs of being financially sustainable,” one of the people cited above said.
In 2020, the company sold its food delivery business, UberEats, to Zomato in an all-stock deal.
Globally, Uber is expanding its grocery-delivery business that it operates under UberEats.
Industry sources said until the beginning of 2023, Dunzo was the leader in the peer-to-peer package delivery service, but since its decline, its rivals have gained ground.
In January 2023, Tiger Global-backed Porter launched two-wheeler delivery services for individuals and businesses. In October, Uber’s chief rival, Ola, and Zomato also rolled out their hyperlocal delivery services.
“After Dunzo’s services started receding from the market, Porter and Uber have taken up most of the vacated space in the package delivery segment. Swiggy Genie has also gained significantly since,” an industry executive said.
Ola exited its quick-commerce business in 2022 when it was cutting down on ancillary segments. Last year, the company launched food delivery on its ride-hailing app through the government-backed ONDC network. It had suspended its own food delivery offering prior to that.
