Imtiaz is one of the most trusted retail names in Pakistan. It has scale, supplier relationships, buying power and a customer base that visits weekly. On paper it should be the default answer to online grocery in this country. It is not, and the reasons are worth understanding because they apply to every large offline retailer considering the same move.
The short version
Grocery has the thinnest margins in retail and the highest cost to fulfil per order. That combination makes online grocery structurally unprofitable unless basket size, pick efficiency and delivery density are all solved together. Most retailers attempt it by bolting a website onto a store, which solves none of them.
The arithmetic that stops most retailers
Consider what happens when a grocery order moves online. Someone has to walk the aisles and pick thirty or forty items. Chilled and frozen goods need separate handling. Fresh produce carries substitution decisions a picker has to make on the customer's behalf. The order then needs delivery, often within a narrow window, to a single address.
Against that, the margin on a basket of staples is thin — considerably thinner than fashion, electronics or beauty. So the cost to serve is high precisely where the margin to absorb it is lowest.
Three variables decide whether it works:
- Basket size. A large basket amortises the pick and delivery cost. A small one cannot. This is why minimum order values in grocery are not an upsell tactic, they are a viability threshold.
- Pick efficiency. Picking from a customer-facing store aisle is slow and disruptive. Dedicated dark stores or in-store micro-fulfilment zones exist because picking speed is the main controllable cost.
- Delivery density. Multiple deliveries in the same neighbourhood on the same run change the economics completely. Scattered single deliveries do not.
A retailer that solves one of these and not the other two will lose money on every order, conclude that online grocery does not work in Pakistan, and stop. That conclusion is wrong, but the experiment that produced it was badly designed.
Why the quick commerce wave did not settle the question
Pakistan's quick commerce entrants attacked this space aggressively with venture funding and, in several cases, did not survive. That has left an impression that online grocery is simply not viable here.
I would read it differently. Those businesses were solving for speed at almost any cost, with delivery promises that forced low density and small baskets — the two worst variables to sacrifice. They also had to acquire customers from scratch and build trust from zero.
An established retailer has neither problem. Imtiaz already has the customers, already has the trust, and already has the supplier terms. Its version of this business would look nothing like the quick commerce version — larger baskets, planned rather than impulse purchases, scheduled delivery windows rather than fifteen-minute promises.
What the store network is actually worth
The most valuable asset a grocery retailer holds is not the brand. It is a network of locations already stocked with the inventory, already staffed, and already close to the customer.
Used properly, that network is a distributed fulfilment infrastructure that no pure-play competitor can build. Click-and-collect in particular is the underrated model here — it removes the delivery cost entirely, keeps the customer's basket large, and converts the store into a pickup point rather than a shopping trip. In a market where fuel costs and traffic make the weekly grocery run genuinely unpleasant, that is a real proposition.
What a credible strategy would need
- Separate economics and separate leadership. Run online with its own P&L, its own targets and someone accountable for it — not as a project inside store operations.
- Solve picking before scaling orders. Dedicated pick zones or dark stores in the highest-density catchments, not pickers competing with shoppers in the aisles.
- Set a minimum basket honestly. Below a certain value the order loses money. That threshold should be a deliberate decision, not something discovered later.
- Lead with click-and-collect. It is profitable from day one and it builds the ordering habit that delivery later monetises.
- Solve substitutions transparently. The fastest way to lose a grocery customer is to replace an item badly without asking. Give the customer the choice at order time.
Why this matters beyond Imtiaz
Online grocery is one of the largest unclaimed positions in Pakistani eCommerce. The category has the highest purchase frequency of anything — a customer who buys groceries from you buys weekly, which is a retention profile no fashion brand can match.
Whoever solves the fulfilment economics first will own a habit rather than a transaction. The reason it has not happened is not that Pakistani consumers do not want it. It is that the operational problem is genuinely hard and the retailers best positioned to solve it have been reluctant to run it as its own business.
What transfers to your business
- Cost to serve, not margin, decides whether a category works online.
- If you have physical locations, they are fulfilment infrastructure, not just shops.
- Click-and-collect is the most underrated model in Pakistani retail.
- Run the online channel on its own P&L or it will be judged by the wrong benchmarks and cut.
Helping established retailers build online as a real channel rather than a department is a significant part of my work. If that is the transition you are facing, get in touch. Full research on this study is published on Ecommerce Baithak.
