Can D2C Be ElasticRun’s Most Profitable Bet Yet?

India’s B2B ecommerce segment has rapidly evolved from a fragmented, kirana-led system into a tech-driven, digitised supply chain. But with the unabated rise of quick commerce platforms, the industry is undergoing yet another transformation.  

The focus has shifted from efficient distribution to rapid fulfilment, with expectations moving from next-day delivery to same-day and even sub-two-hour timelines. This is pushing players to decentralise inventory, build hyperlocal networks, and prioritise speed, flexibility, and real-time execution.

ElasticRun is a key example of this. The unicorn is reworking its playbook by pivoting towards D2C-led quick commerce enablement. 

Founded in 2016 by Sandeep Deshmukh, Saurabh Nigam and Shitiz Bansal, the company built its early thesis around connecting brands to rural consumers through a tech-led distribution network. 

Initially positioned within India’s $60 Bn B2B ecommerce market, ElasticRun operated as an extension of FMCG companies’ direct distribution in the hinterland, solving supply chain inefficiencies and enabling deeper market reach. 

It now positions its network as a plug-and-play infrastructure layer where brands can place inventory across distributed fulfilment centres, as ElasticRun manages the backend, order allocation, picking, shipping, and last-mile deliveries.

This transition is already visible in its operating metrics. ElasticRun currently handles close to 5 Mn orders per day, with recent volume growth largely driven by the shift towards faster fulfilment.

“The biggest inflexion came last year as everyone shifted towards fast fulfilment. While traditional models still exist, there are very few large-scale partners available for same-day or two-hour delivery,” said Deshmukh, pointing at a clear supply gap that the company is looking to address yet again.

To support this shift, the company is repurposing its network across 500+ cities, with 900+ delivery stations and around 100 fulfilment centres. 

The shift is also reflected in its customer mix. Until FY25, ElasticRun’s volumes were largely driven by large national brands. In FY26, the company moved towards regional brands with better unit economics. 

“We have seen a strong momentum from D2C brands. Over 70 D2C brands were onboarded in the last six months, with several hundred more expected in FY27,” the founder added. 

So, what does the unicorn’s shift to D2C really mean? 

ElasticRun’s D2C Route

While the company’s pivot towards D2C is driven by demand, it also reflects a shift in its operating model and economics. Traditional FMCG and enterprise clients offer stable, predictable demand but limited scope for growth. In contrast, D2C brands introduce higher volatility but significantly higher upside.

“D2C brands can help multiply sales within a quarter or a year, which makes them a strong driver of incremental volumes and network utilisation,” Deshmukh noted.

He, however, added that the way ElasticRun engages with these brands is fundamentally different. For established FMCG players, the company has historically operated as a B2B distribution engine, at times even taking ownership of inventory for brands with stable throughput. With D2C, it shifts to a fulfilment-first model, avoiding inventory risk while focusing on execution.

“Our fulfilment network is available… you deploy your inventory into our fulfilment centres, and from that point onward, we handle everything — order allocation, picking, shipping, and delivery,” Deshmukh said.

He added that the model is structurally lighter on working capital, more scalable and ‘increasingly attractive from a margin perspective’. Higher growth among D2C brands directly improves network utilisation, driving operating leverage. The unit economics are strong, and more importantly, the model scales rapidly.

For brands, the value proposition extends beyond speed. ElasticRun claims to have seen improvements in fill rates, lower returns, and better customer retention, all of which directly impact D2C unit economics in a competitive market.

From Capex-Heavy Logistics To Asset-Light Networks

ElasticRun’s current pivot is rooted in a foundational insight from its early days. Deshmukh, who was part of the early leadership team at Amazon India, had first-hand visibility into what it takes to build a nationwide logistics backbone.

The conclusion was clear: traditional fulfilment and delivery networks require significant investments in real estate for warehousing, fleet, and manpower.

The starting challenge for ElasticRun was whether this model could fundamentally be rethought. Instead of building and owning these assets, the company tapped into underutilised warehouses, unused vehicle time, and part-time workforce availability to construct a nationwide network without heavy upfront investment. This approach also created a parallel incentive structure. Asset owners could monetise idle capacity, while brands could access a scalable distribution network without major upfront costs.

Another equally important problem statement was around capacity rigidity in traditional networks. Fixed networks come with locked capacity. If a delivery agent can handle 40 shipments, costs are incurred for that capacity regardless of actual utilisation.

ElasticRun’s variable model addressed this by enabling flexible scaling of capacity. The network could expand from 40 to 80 to 120 shipments, while costs remained aligned to actual usage. This introduced both cost efficiency and operational flexibility, which became core to the company’s value proposition.

ElasticRun’s Three-Pronged Evolution

The company’s growth trajectory can be broken into three distinct phases, each aligned with shifts in the broader market. Maharashtra-based ElasticRun started with a focus on deep rural markets that were underserved by traditional logistics players. Its variable cost network made access to these geographies viable, allowing it to scale rapidly.

During this phase, it partnered closely with ecommerce marketplaces like Amazon and Flipkart, eventually becoming a key logistics partner in these regions. According to Deshmukh, product-market fit was evident within the first few months itself, with multi-fold monthly volume growth driven by improved delivery speeds in rural areas.

Around 2019, ElasticRun began engaging with FMCG companies to support rural distribution. This segment saw a sharp inflexion during the pandemic, when traditional supply chains were disrupted.

The current phase is being driven by the rise of quick commerce. As supply chains move away from large centralised warehouses and mid-mile logistics towards last-mile-centric fulfilment, ElasticRun’s network architecture has become more relevant.

Historically a last-mile-heavy network, ElasticRun is now converting delivery stations into fulfilment centres, enabling both storage and delivery from the same node.

Execution Concerns Persist In Quick Commerce

While the opportunity in quick commerce-led fulfilment is evident, ElasticRun’s execution track record remains under scrutiny.

According to multiple industry sources, the company is facing challenges around service consistency, which in some cases has impacted client retention and allocation of promised volumes or budgets.

In a quick commerce environment, where delivery timelines can be as tight as two hours, even minor operational inefficiencies can have outsized consequences on brand experience and repeat business.

ElasticRun, however, disputes this.

“We have not lost any enterprise or large clients over the last 12-18 months. In fact, our client base has expanded meaningfully during this period, particularly with the addition of several D2C brands,” Deshmukh said.

On the service quality side, while the company does not disclose granular service level agreement (SLA) metrics publicly, Deshmukh maintained that performance on reliability and delivery quality remains strong. He said that ElasticRun has scaled shipment volumes by around 40% over the past year, while maintaining on-time delivery and order accuracy.

He also highlighted that the company’s Net Promoter Score (NPS) score is among the highest in the industry, with a strong repeat rate across brand partners. This suggests that SLA commitments are translating into a consistent end-customer experience.

Even so, the competitive landscape remains intense. Players such as Shadowfax and Delhivery continue to expand aggressively, strengthening enterprise relationships and scaling their networks. At the same time, smaller, specialised players like Blitz, iNamo and Zippee have started to dominate the quick commerce logistics layer.

As per industry estimates, ElasticRun holds a relatively small share of the quick commerce logistics market, indicating that it has ground to cover despite its network scale.

ElasticRun’s Next Big Test

Right now, ElasticRun is doubling down on metro markets, where demand density and order velocity are the highest. Looking ahead to FY27, the company expects to expand its reach to the top 200 cities and eventually cover all 500 cities by FY28.

At present, ElasticRun operates in around 500 towns, supported by 900+ last-mile delivery stations and around 100 fulfilment centres. The company emphasises that city-level presence is a more relevant metric than pin codes. Its current footprint already covers 98-99% of demand across the top 500 cities.

Going forward, expansion is expected to be driven less by entering new geographies and more by increasing capacity within existing markets. ElasticRun currently operates with roughly two delivery stations per city, which could scale to three, four, or more as demand grows. Similarly, the ratio of fulfilment centres to delivery stations, currently around 1:10, is expected to evolve, with more delivery stations potentially doubling up as fulfilment hubs to support faster deliveries.

At the fastest end, ElasticRun offers two-hour delivery for select products. Same-day delivery is increasingly becoming a larger share of the portfolio. Alongside this, the company continues to operate a delivery-only model, where products are shipped from other parts of the country into its network and delivered through same or next-day timelines.

Overall, ElasticRun is attempting to build a full-spectrum fulfilment network, spanning delivery timelines from 30 minutes to next-day, depending on brand requirements and inventory placement.

ElasticRun’s FY26 was defined by a clear shift — D2C brands becoming the fastest-growing segment in its portfolio.

“FY26 has been the year of D2C brands for us. In FY27, same-day delivery is likely to become the standard offering,” Deshmukh said. For ElasticRun, this creates both an opportunity and a test.

D2C brands offer higher growth potential compared to traditional FMCG clients, but they also demand higher service reliability and faster execution. In a market where expectations are being set by vertically integrated quick commerce platforms, any gaps in service can quickly translate into lost business.

Edited by Shishir Parasher

Creatives by Abhyam Gusai

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