Swiggy Instamart Experiments With Physical Retail

Adding on to its spree of experimentations, consumer services giant Swiggy has now opened an offline Instamart branded mini store in Gurugram. Instamart, which is the company’s quick commerce arm, has till now operated online, fulfilling orders through its dark stores.

However, the store is not owned by Instamart but is seller-owned and seller-operated, in line with its darkstore model. The business model of this particular store differs from the darkstore model in the sense that the seller collects the revenue and shares a commission with Swiggy. For darkstores, the model is completely opposite, as per sources.

Sources close to the development told Inc42 that the seller is procuring the goods from external wholesalers as well as Instamart. Instamart is only providing branding and services for this retail store experiment.

Moreover, these will not be full fledged stores featuring all the products available online. Instead, these experiential mini stores will carry only 100-200 stock-keeping units (SKUs) compared to 15,000-20,000 carried in dark stores. These are expected to be mainly everyday grocery items like fresh fruits and vegetables, grains and pulses, and also new launches and D2C products that customers can get a feel of before purchasing.

The size of the retail store, 400 sq ft to be precise, is a fraction of the size of a typical Swiggy dark store, which is in the range of 2,500-4,000 sq ft.

Important to highlight that Swiggy’s quick commerce business has been a significant money drainer over the past few quarters. In the second quarter of the current financial year (Q2 FY26), Swiggy’s losses ballooned nearly 75% YoY to INR 1,092 Cr, due to the INR 739 Cr loss incurred from the quick commerce vertical.

Despite the losses, Instamart holds a significant but fluctuating share in India’s quick commerce market. It is generally ranking second or third behind market leader Blinkit, with estimates placing Instamart’s share around 23-27%, often competing closely with Zepto.

The company has been steadily adding larger in size dark stores (megapods) over the past year, with half of the 40 dark stores added to its network in Q2 FY26 being megapods. These stores are 8,000-10,000 sq ft each and capable of stocking up to 40,000 SKUs.

Following last year’s public listing, the company also raised INR 10,000 Cr (around $1.2 Bn) via a qualified institutional placement (QIP) earlier this month. A bulk of these funds would be utilised to expand its quick commerce dark store count.