A file photo shows Meituan delivery drivers collecting food in Jinan, capital of East China's Shandong province. (Photo/Xinhua)

Chongqing - With “order anything, anytime” now a reality, instant retail is heating up in China. Real-time online orders and rapid offline delivery are driving fierce competition, especially in high-demand sectors like food delivery.

Meituan has long reigned supreme in China’s food delivery scene, while Alibaba’s Ele.me has struggled with a steady slide in market share.

Just six days after launching Taobao Flash Sales on May 5—Alibaba’s upgraded “One-Hour Delivery” service—daily orders soared past 10 million. The surge reflects the powerful synergy between Taobao’s vast product range and Ele.me’s delivery network.

Taobao Flash Sales is now open to all brand merchants on the Taobao and Tmall e-commerce platforms, enabling cooperation with city warehouses and offline stores. It also connects Tmall's official flagship stores with Flash Sales' product pools and pricing systems. 

At the same time, Ele.me's supply network—including its food delivery services—has been fully integrated into the platform, ensuring timely deliveries.

Currently, the Taobao Flash Sales covers not only food and beverage delivery but also a wide range of daily necessities. The Flash Sales and Ele.me have also jointly provided consumer subsidies totaling more than 10 billion yuan ($1.39 billion).

Another Chinese e-commerce giant, JD.com—long focused on 3C products (computers, communications, and consumer electronics)—launched its food delivery platform on March 1.

On April 11, JD Food Delivery launched a "10 billion yuan subsidy" campaign, and on the evening of April 22, it announced that the day's order volume had surpassed 10 million, covering 166 cities across China.

On April 15, Meituan rolled out its instant retail brand, Meituan Flash Sales, now featured as a main tab on its app alongside food delivery and group buying. Teaming up with major retailers, brands, and local shops in nearly 3,000 regions across China, the service targets everyday shopping needs with speed and convenience.

Over the years, Meituan has cultivated strong user habits and built a ecosystem of merchants, users, and delivery riders—boasting 7 million annual active riders and nearly 15 million active merchants. With a delivery network handling around 70 million food orders per day, Meituan's fulfillment capabilities are among the strongest in the industry, making it one of the most frequently opened apps in China, second only to social media platforms.

Meituan's key move in the instant retail business is the "flash warehouse". It adopts a cooperation model, encompassing two business formats: convenience store pre-positioned warehouses and pet store pre-positioned warehouses. Through online operation and by leveraging Meituan's delivery capabilities, it provides users with the rapid delivery of a rich variety of products.

According to a Meituan insider quoted by China’s financial outlet Wallstreetcn, the company has built over 30,000 flash warehouses of various sizes nationwide. Described as “capillaries” of the supply chain, these hubs boost Meituan’s supply-side strength, supporting over 6,000 SKUs. Meituan Flash Sales also plans to expand into digital and home appliance brands with dedicated flash warehouses later this year.

China’s food delivery war shifts from traffic to ecosystems

Traditional e-commerce has essentially become part of the infrastructure in today's market, with growth having slowed. In contrast, instant retail remains one of the few sectors still experiencing explosive growth, and major players see it as a key driver for future expansion.

Ding Zhechuan, an analyst at China Merchants Securities, was quoted by Wallstreetcn as saying that as instant retail expands beyond categories like fresh produce, food and beverage, and daily necessities to include high-ticket items such as 3C products, beauty, and apparel, the penetration of higher-value goods will continue to increase. 

With logistics efficiency and service quality on the rise, the instant retail industry is set for continued rapid growth. Ding also expressed confidence in its long-term potential.

According to the 2024 report on instant e-commerce development released by Chinese Academy of International Trade and Economic Cooperation, China's instant e-commerce market reached 2 trillion yuan in 2023, up 36 percent year-on-year. The report projects that by 2027, the market will exceed 5 trillion yuan.

Zhao Quanwu, Professor at the School of Economics and Business Administration of Chongqing University, said that the current competition among the three major platforms—JD.com, Meituan, and Alibaba—in the food delivery sector has essentially evolved from a battle for traffic into a battle of ecosystems. By leveraging the high-frequency nature of food delivery consumption, all three are striving to increase user stickiness and build out their respective ecosystems.

This shift is expected to bring long-term benefits to China's instant retail market, as the ultimate competition will focus on ecosystem building, business model integration, user experience, and cost-effectiveness—driving the industry toward healthier and more sustainable development.

He believed that in the multidimensional battle of ecosystems, areas such as food safety and hygiene, protection of delivery riders' rights, and trustworthy, high-quality merchants will all benefit.

However, to prevent market monopolies, he suggested addressing both explicit and implicit platform restrictions that hinder merchants, riders, and consumers from switching between platforms, ensuring greater autonomy for all parties.

At the same time, Zhao cautioned against promotional price wars that attract customers at below-cost prices, only for platforms to raise prices later or introduce hidden barriers. Such practices could harm the healthy development of the instant retail industry.

(Dai Xuelin, as an intern, also contributed to this report.)