Supermarkets in malls are scaling down their physical presence, with some reducing their store sizes by up to 50%, as the rapid rise of quick commerce is reshaping consumer behaviour. The supermarket space that once spanned 30,000 to 50,000 square feet in a typical one million sq ft mall has now been halved.
According to industry leaders and real estate executives, the growing popularity of rapid online deliveries has led to a significant shift in how supermarkets operate and how mall spaces are being utilised.
Abhishek Bansal, executive director at Pacific Malls, said that the shift towards digital convenience has had a tangible impact on large-format supermarket chains. “There have been casualties. Supermarkets have seen a major transformation in their formats over the past five years. Some have shrunk, and others have shut down entirely,” he said, talking about the changes brought about by evolving consumer preferences.
Saurabh Shatdal, executive managing director, capital markets and head of retail India at Cushman & Wakefield, said current leasing sizes are now closer to 15,000 to 20,000 square feet. This reduction mirrors the growing confidence among urban and semi-urban consumers in quick commerce platforms such as Blinkit, Zepto, and Instamart, which promise fast delivery of groceries and essentials with added incentives like discounts and loyalty programmes.
Though the number of online orders has surged, according to industry estimates, groceries and everyday household items still comprise nearly 75% of all purchases made via quick commerce apps. This directly affects the core offerings of traditional supermarkets, which are losing footfall and relevance in their conventional brick-and-mortar form.
Despite this contraction, not all is grim for physical retailers. Pushpa Bector, senior executive director and business head at DLF Retail, said that premium supermarkets with curated offerings and experiential elements continue to draw consumers. “People still want to step out and enjoy a differentiated shopping experience, especially in the premium segment,” she said, suggesting that experience-driven retail may be the way forward for supermarkets looking to survive.
As supermarkets downsize or exit, mall developers are reallocating this space to more profitable and in-demand categories. Food and beverage outlets, beauty and wellness brands, athleisure, and even jewellery retailers are stepping in to fill the gap. These categories are not only resilient but thriving, as per a recent Cushman & Wakefield report.
The report shows that the footprint of beauty and wellness brands in premium malls has nearly doubled, from 6-8% before the pandemic to 15-16% by the end of 2024. Similarly, F&B outlets now occupy 15-18% of space, up from their earlier 6-8% share. Athleisure and sports brands have increased their presence to 11-13%, while jewellery brands now command 2-3%, nearly doubling their earlier footprint.
Older malls are also undergoing physical and functional makeovers to stay relevant. “Malls that opened 10 to 15 years ago are actively reconfiguring their layouts to match new demands,” Shatdal said, underlining the need for adaptability in a retail landscape increasingly defined by rapid change.