- Title: Every second counts as startups race to deliver fresh food
- Date: 19th May 2021
- Summary: LONDON, ENGLAND, UNITED KINGDOM (MAY 19, 2021) (REUTERS VIA ZOOM) (SOUNDBITE) (English) ANALYST AT NBK RETAIL, NATALIE BERG, SAYING: "Well they're definitely causing a stir in the grocery sector, they've even managed to outpace some of the more disruptive names such as Amazon, and Deliveroo, and Uber eats and that's for a very good reason, because in order to deliver groceries within 15 minutes they have to make a very major sacrifice, and that is to drastically reduce the number of products available. So many of these rapid delivery providers are only offering between 1 to 2000 products, whereas if you shopped on a traditional supermarkets' website you're looking at 50,000+ products available, so it's a very different offering altogether and I don't think they will ever replace the weekly food shop, it's very much complimentary."
- Embargoed: 2nd June 2021 19:22
- Keywords: Aldi Getir Gorillas Groceries Lidl Sainsbury's Weezy delivery supermarkets
- Location: LONDON, ENGLAND, UNITED KINGDOM
- City: LONDON, ENGLAND, UNITED KINGDOM
- Country: United Kingdom
- Topics: Company News Markets,Europe,Economic Events
- Reuters ID: LVA002EDRMGJR
- Aspect Ratio: 16:9
- Story Text: In a railway arch in south London a team of pickers and packers are in a race against time: to get fresh food to the door of Alastair Dean within 15 minutes of his order hitting an app.
The staff at Weezy are part of an army of new European rapid grocery delivery firms that, backed by billions of dollars of venture capital from Europe, the United States, China and Japan, are using electric bikes and scooters to deliver groceries.
Their arrival marks a bet that demand for convenience will drive the next transformation in food retail and help crack the vice-like grip held by big supermarket stores which, in Britain, supply 95% of the country's groceries.
For shopper Dean, Weezy enables the 32-year-old finance worker to select locally produced goods that are regularly delivered to his small flat and tiny fridge. When ordering shaving foam he will throw in rocket for that night's dinner.
In central London, residents have been bombarded with offers from at least four new rapid services. The legions of food-delivery riders from Deliveroo and Uber Eats will bring groceries from established chains. And supermarkets, with their weekly online van-deliveries, are testing faster waters.
Weezy, like its London rivals Getir, Dija and Gorillas, stores goods from major suppliers and local producers in so-called dark stores in town to supply customers within 15 minutes of an order, at prices similar to supermarket convenience shops.
Holding up to 2,000 items instead of the 10,000 or more in supermarkets, dark stores built for delivery rather than customers can be picked quickly and located in cheaper areas.
Co-founder Alec Dent said orders had jumped since Britain started to unlock from COVID restrictions and people's lives became more complicated. Once they know they can rely on a 15-minute delivery, he said, anything longer seems too slow.
Many start by ordering snacks and alcohol before adding sourdough bread, vegetables, meats, herbs, fresh pasta, condoms, games and COVID tests, to be delivered in brown paper bags.
The trend has taken root across European cities, where Amazon has yet to gatecrash the grocery market.
So far there are three online models: the dark stores of Weezy, partnerships between supermarkets and takeaway apps and the traditional weekly online van-delivery supermarket business.
While dark stores have high costs and low margins its riders are classed as workers, giving them basic rights and making the groups less vulnerable to regulatory change in the future. In full control of the supply chain, they can also guarantee speed.
With so much activity, the supermarkets are watching and know they will have to find a solution over time.
They face a dilemma - fearful of losing customers to ultra fast delivery, but having built online offerings out of stores with supermarket staff picking for online customers alongside those in the store they are fearful the hefty costs of a major infrastructure reconfiguration might not be backed by investors.
To be sure, the rapid delivery groups said their operations were complicated, that making a profit would take time and that consolidation would be needed. But they say the initial reaction has been strong, and shopper Dean is on board.
(Production: Natalie Thomas) - Copyright Holder: REUTERS
- Copyright Notice: (c) Copyright Thomson Reuters 2021. Open For Restrictions - http://about.reuters.com/fulllegal.asp
- Usage Terms/Restrictions: None
