South America Quick Commerce Market Outlook, 2029

The quick commerce market was born in the early 2010s, South America, directly at an increase in e-commerce and mobile technology. It was proceeding, first of all, to the delivery of traditional models and online shopping. Afterwards, given the quick rise in the use of cell phones and a change in consumers' demand to be met immediately, the quick commerce sector grew very fast in this second period of the decade. Taking this ultra-fast delivery service to start investing in technology and logistics whisked them right away from the traditional format of retailing into a more convenience-centric approach.

Many firms are trying to reduce the environmental mitigation measures through reductions in packaging wastes, use of recyclable materials, and optimization of routes so that lower carbon is emitted during deliveries. Another tendency follows the increase of green delivery options, like electric vehicles and bike deliveries. The South American Quick Commerce Market is booming, and this has started to entail the entrance of businesses with a sustainable orientation to give the market a more competitive look and attract this segment of the market as South American consumers are becoming more environmentally conscious. What is happening now is a total overhaul driven by technology and the changing preference of the consumers.

It has had companies looking to add AI and automation to do the heavy lifting in demand forecasting, inventory management, and delivery logistics. Fueled by ever-growing mobile technology, companies have been at pains to optimize mobile app functionalities further for a customer-centric experience. Regional developments include the domination of this market by Brazil, with major players such as Rappi and Loggi, and new opportunities existing within Argentina, Colombia, Chile, and Peru. Government support for the quick commerce sector is gaining momentum in South America. It is reflected in a number of initiatives that are usually oriented at fostering the growth and innovation of the sector.

Tax incentives in some countries are aimed at galvanizing e-commerce and technology-driven businesses. One of the main investment areas currently is in infrastructure development building digital infrastructure and urban logistics support, a packaged set of investment for the underpinning of quick commerce operations. For example, the Brazilian Innovation Fund is dedicated to financing technology projects, while Colombia's Innovation Fund is setting up a Digital Economy Strategy for digital transformation in the sector.

According to the research report "South America Quick Commerce Market Outlook, 2029" the South America Quick Commerce market is anticipated to add to more than USD 7 Billion by 2024-29. The growth in mobile technology and e-commerce penetration is driving market growth, with consumers looking for quicker delivery and convenience. Substantial investments by venture capital and private equity firms help quick commerce services grow by scaling operations and developing robust technology infrastructures. Quick commerce services are likely to grow in further consumer adoption as they keep up with the demand for speed and reliability in delivery solutions.

Omnichannel integration combining online and offline retail experiences comes into the limelight. Quick commerce companies are striving to ensure integrated digital platforms with physical stores that would support single shopping experiences for further customer convenience. Consumer trends in the South American quick service industry market are characterized by strong demand for convenience and speed. Grocery delivery services of fresh produce and essential household items have secured a special place in consumer preference in this context because people are willing to be served with quickness and reliability for all their everyday needs.

The demand for personal care products is growing, representing the epitome of attention in the marketplace toward convenience in many areas of the daily life of a consumer. According to the compiled survey, there is a bias by the consumers towards products which are local or originating from their region. It is within these that quick commerce platforms adapt to offer their services and products in special needs tailored for the local consumers. Key events and initiatives drive the South American Quick Commerce market. One of the key events here is the E-commerce South America Conference, where the major industry operators, innovators, and investors gather every year to discuss the novelties and evolution of this sector.

Market Drivers

• Mobile Penetration and Digital Payments: In South America, the increasing penetration of mobile phones and the growth of digital payment systems are major drivers of the quick commerce market. With more consumers gaining access to smartphones and internet connectivity, online shopping has become more accessible. The adoption of digital wallets and other online payment methods has further facilitated the growth of quick commerce, enabling faster and more secure transactions. This trend is particularly evident in countries like Brazil and Argentina, where e-commerce platforms are expanding their offerings to include rapid delivery services, catering to a growing middle class that values convenience and efficiency.
• Young Demographic: The young demographic in South America is a key driver of the quick commerce market. This region has a large population of tech-savvy millennials and Gen Z consumers who are accustomed to instant gratification and prefer quick, on-demand services. These younger consumers are more likely to use mobile apps for shopping and expect rapid delivery of goods, particularly for items like food, beverages, and personal care products. Companies are targeting this demographic by offering personalized, app-based shopping experiences and leveraging social media platforms to engage with them directly, thereby driving the growth of the quick commerce sector in the region.

Market Challenges

• Infrastructure Limitations: Infrastructure limitations are a significant challenge for the quick commerce market in South America. The region faces issues such as poor road conditions, inadequate transportation networks, and unreliable logistics infrastructure, which hinder the efficient movement of goods. These challenges are particularly acute in rural and remote areas, where delivery times can be significantly delayed. The lack of advanced warehousing facilities and cold chain logistics further complicates the delivery of perishable goods. Companies must navigate these infrastructure challenges by investing in local distribution centers and partnering with reliable logistics providers to ensure timely deliveries.
• Economic Instability: Economic instability in South America presents a major challenge for the quick commerce market. The region has experienced fluctuating exchange rates, high inflation, and political uncertainty, which impact consumer purchasing power and overall market demand. These economic challenges can lead to reduced consumer spending, particularly on non-essential items, and make it difficult for companies to maintain profitability. Economic instability can result in supply chain disruptions, increased operational costs, and difficulties in securing investment. Companies operating in the region must adopt flexible business models and pricing strategies to navigate the economic volatility and sustain their operations.

Market Trends

• Expansion of Localized Services: In South America, there is a growing trend towards the expansion of localized quick commerce services. Companies are increasingly focusing on hyperlocal strategies, partnering with local retailers, and leveraging local delivery networks to provide faster and more reliable services. This trend is driven by the need to overcome the region's infrastructure challenges and meet the demands of consumers in both urban and rural areas. By tailoring their offerings to the specific needs of local communities, companies can enhance customer loyalty and gain a competitive edge in the market. This localization strategy helps in mitigating the risks associated with economic instability.
• Growth of Grocery Delivery: The growth of grocery delivery services is a notable trend in the South American quick commerce market. The COVID-19 pandemic accelerated the adoption of online grocery shopping, and this trend has continued as consumers have become accustomed to the convenience of having groceries delivered to their doorsteps. Companies are expanding their product offerings to include a wide range of fresh and packaged foods, beverages, and household essentials. The focus on grocery delivery is supported by partnerships with local farmers and suppliers, ensuring a steady supply of fresh produce. This trend is expected to continue as consumers increasingly prioritize convenience and time-saving solutions.

Food & Groceries is at the top of the table in the Quick Commerce market in South America due to the growing demand for convenience and efficacy, which, in effect, is brought about by urbanization and participants' increase in the uptake of digital technology.

Food & Groceries is perfect for quick commerce in South America as the consumption items are day-to-day necessary products that really need quick delivery to save the client time; the traditional grocery shopping journey is quite time-consuming, involving traveling to stores, waiting in lines, and carrying all the heavy bags. A fast-paced urban lifestyle in major South American cities has driven consumers to demand convenient shopping solutions that save them time, making quick commerce very attractive. Fast commerce marketplaces meet this demand by providing a gapless array of products, ranging from fresh food to everyday necessities, with delivery to the end consumer within minutes.

This convenience has had particularly strong appreciation from busy urbanites, young professionals, and families taking on multiple duties. With an increased, tech-savvy population in the South American market, raised internet and smartphone penetration are compelling consumers to shop online at a higher frequency. This trend was rapidly growing over the need for more convenient as well as safer alternatives for in-store shopping and has been more accelerated by the COVID-19 pandemic. It has powered the quick commerce sector on the backs of an increase in startups and investments being made by established retail firms in rapid delivery infrastructure.

This will be coupled with that of a region that is densely urban and where large portions of its populations live in relatively smaller places that allow for effective and very fast delivery services. It hosts unique challenges in that it is a tough market with regards to infrastructure gaps and logistical complexities. Despite these challenges, the demand for convenience and increasing familiarity with digital technologies is pushing Food & Groceries to be one of the foremost categories in South America's quick commerce market, with immense growth prospects as consumers continue to drive home immediacy and ease in shopping experiences.

The online is leading the quick commerce market in South America would have to be the increasing demand for fast and hassle-free delivery services, mostly driven by urbanization and changing consumer habits.

The rapid growth is the increasing urban population, wherein consumers suffer through traffic congestion and poor accessibility to retail stores. With this, convenience is preferred more in availing services which can provide groceries and other urgent items within a maximum time of 30 minutes. Q-commerce platforms have ridden on the trend to establish what is referred to as "dark stores" basically centers for fulfillment that return delivery fast without the need to open a storefront. These dark stores are thus a bridge to greater efficiency and shorter delivery times exactly what their clients at Rappi, iFood, and Cornershop need urgently for the urban consumer.

It is the COVID-19 pandemic that has further accelerated its adoption in the region. Due to lockdowns and health concerns that made consumers avoid physical stores, many turned to online platforms for their shopping needs. Not only has this increased the user base of quick commerce services, but encouraged companies to innovate and grow their offerings. For instance, Rappi launched its Rappi Turbo service, through which it delivers products in record time, and has opened more than 330 dark stores in all of Latin America to support the same.

This dictates that the competitive environment in South America is composed of regional and global players competing against one another for market share, thus constantly striving to bring about changes in service delivery and improvement of customer experience. By utilizing technology and data analytics to optimize their logistics and inventory management, companies can manage to keep up with growing consumer demand, increasingly in search of instant gratification in shopping experiences.

The proliferation of smartphones and the growing fever for on-demand delivery options have made application-based operations dominant in the South American quick commerce market.

The quick commerce market of South America has greatly influenced the whole dynamic of the world through the years if viewed in light of app-based operations. All being said, the huge impact has mainly been from the rapid expansion made in smartphone usage across the region. With the enhanced reach and accessibility of smartphones, consumers are increasingly reliant on mobile applications to meet their daily demands. It is the convenience brought by these applications that are aligned perfectly with the fast delivery services consumers demand. The high pace of lifestyle on this continent and a great percentage of digital adoption make South America's cities the perfect grounds for app quick commerce.

Therefore, this is a very easy-to-use app through which orders can be placed, deliveries can be tracked, and payments are made with just a few taps. The application-based operations enable quick commerce companies to use data analytics to personalize customer experiences and optimize delivery routes. Customer needs are addressed since recommendations are reached at drawn from analyses of the user's preferences and behavior for delivery to be conducted within the possible shortest time. Such a data-driven approach can enable the finetuning of inventory management and operation efficiencies, two key ingredients in a market where the key differentiator is speed coupled with reliability.

Technologies like real-time tracking and automated dispatch systems have further added to the success of the app-based model. They do not only ease the system but increase the transparency and accountability of the service while developing trust among the consumers. With the fiercely competitive Environment of Quick Commerce within South America, those companies were forced to adopt innovative app-driven solutions that could leverage their leadership in the market by scaling operations, rethinking consumer behaviors, and delivering first-class customer service.

Brazil is driving the quick commerce market in South America due to the size and pace at which its e-commerce sector is growing.

With over 212 million people, Brazil has the highest e-commerce share within South America. According to reports, the country's e-commerce market is growing at a rapid pace, given the increase in internet penetration, growing middle class, and a favorable business environment. This growth in demand has seen a resultant quick commerce, with Brazilian customers increasingly expecting speedy and handy delivery options for their online purchases. The Brazil quick commerce market is dominated by local players like Mercado Livre, Buscapé, and Magazine Luiza. These companies have invested heavily in logistic and delivery capabilities as a way of ensuring fast and reliable delivery services to customers.

It is being supported by the highly developed logistics infrastructure in the country, which includes a vast network of delivery companies and courier services. There has been driven an increasing demand for online grocery shopping in Brazil, as most consumers look for a convenient and time-saving solution to meet daily grocery needs. Governmental support for e-commerce and the digital economy has been extended in Brazil, providing a good business environment within which quick commerce companies can function. The "Digital Agenda" of the government, aimed at supporting the development of the digital economy, encourages the development of e-commerce and quick commerce.

The growth in social commerce has fueled demand for quick commerce within Brazil, as increasingly more customers use social media platforms such as Facebook and Instagram for product discovery and purchases, expecting fast and easy delivery options. The quick commerce market of Brazil has several challenges to tackle too, including high logistics costs, complex tax regulations, and limited access to credit for small and medium-sized enterprises.

Considered in this report

• Historic year: 2018
• Base year: 2023
• Estimated year: 2024
• Forecast year: 2029

Aspects covered in this report

• Quick Commerce market Outlook with its value and forecast along with its segments
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

By Product Type

• Food & Groceries
• Stationary
• Personal Care Items
• Small Electronics & Accessories
• Others (Pets, alcohol, gifts & flowers, Medicines)

By Payment Mode

• Cash on Delivery
• Online

By Technology

• Application Based Operation
• Hybrid Operation
• Website Based Operation

The approach of the report:

This report consists of a combined approach of primary and secondary research. Initially, secondary research was used to get an understanding of the market and list the companies that are present in it. The secondary research consists of third-party sources such as press releases, annual reports of companies, and government-generated reports and databases.

After gathering the data from secondary sources, primary research was conducted by conducting telephone interviews with the leading players about how the market is functioning and then conducting trade calls with dealers and distributors of the market. Post this; we have started making primary calls to consumers by equally segmenting them in regional aspects, tier aspects, age group, and gender. Once we have primary data with us, we can start verifying the details obtained from secondary sources.

Intended audience

This report can be useful to industry consultants, manufacturers, suppliers, associations, and organizations related to the Quick Commerce industry, government bodies, and other stakeholders to align their market-centric strategies. In addition to marketing and presentations, it will also increase competitive knowledge about the industry.


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