Groceries in 10 minutes: delivery startups all over the world’s city streets

海报

The latest darling of venture capital is the online fast grocery delivery industry. Getir is a 6-year-old Turkish company that is trying to surpass its new competitors in global expansion.
London-A new entrant who shuttles between Uber Eats, Just Eat and Deliveroo’s bicycles and scooters in central London promises to satisfy your cravings for chocolate bars or a pint of ice cream almost immediately: Turkish company Getir says it will Ship your groceries in 10 minutes.
Getir’s delivery speed comes from a network of nearby warehouses, matching the company’s recent astonishing speed of expansion. Five and a half years after starting the model in Turkey, it suddenly opened in six European countries this year, acquired a competitor, and is expected to start operations in at least three U.S. cities, including New York, by the end of 2021. In just six months, Getir raised nearly $1 billion to fuel this outbreak.
“We have accelerated our plans to go to more countries because if we don’t do it, others will do it,” said Getir founder Nazem Salur (this word means “bring” in Turkish. the meaning of). “This is a race against time.”
Mr. Saruer looked back and was right. In London alone, in the past year or so, five new fast grocery delivery companies have taken to the streets. Glovo is a 6-year-old Spanish company that provides restaurant catering and groceries. It raised more than $5 billion in April. Just a month ago, Philadelphia-based Gopuff raised funds from investors including the SoftBank Vision Fund $1.5 billion.
During the pandemic, homes were closed for months and millions of people began to use online grocery delivery. There has been a surge in delivery subscriptions for many things, including wine, coffee, flowers and pasta. Investors have captured this moment and support companies that can bring you anything you want, not just quickly, but within minutes, whether it’s a baby diaper, a frozen pizza or a bottle of iced champagne .
Fast grocery delivery is the next step in the luxury wave subsidized by venture capital. This generation is accustomed to ordering taxi services within minutes, vacationing in cheap villas through Airbnb, and providing more entertainment on demand.
“This is not just for the rich, the rich, the rich can waste,” Mr. Saruer said. “This is an affordable premium,” he added. “This is a very cheap way to treat yourself.”
The profitability of the food delivery industry has been elusive. But according to PitchBook data, this has not stopped venture capitalists from investing about $14 billion in online grocery delivery since early 2020. This year alone, Getir completed three rounds of financing.
Is Getir profitable? “No, no,” said Mr. Saruer. He said that after one or two years, a community can be profitable, but this does not mean that the entire company is already profitable.
Alex Frederick, an analyst at PitchBook who studies the food technology industry, said that the industry seems to be experiencing a period of blitz expansion. (Reid Hoffman) created to describe the global customer base of a company competing to provide services ahead of any competitor. Mr. Frederick added that at present, there is a lot of competition between companies, but there is not much difference.
One of Getir’s first major investors was Michael Moritz, a billionaire venture capitalist and Sequoia Capital partner, who is known for his early bets on Google, PayPal, and Zappos. “Getir piqued my interest because I haven’t heard any consumers complain that they received orders too quickly,” he said.
“Ten-minute delivery sounds simple, but newcomers will find that raising funds is the easiest part of the business,” he said. He said it took Getir six years-”the eternity of our world”-to solve its operational problems.
Despite this, urban streets around the world are still crowded with emerging grocery delivery services. As competition becomes more intense, express companies in London-such as Gorillas, Weezy, Dija and Zapp-have been offering very large discounts. Once, Getir offered food worth 15 pounds (approximately US$20.50) for 10 pence (approximately 15 cents).
This does not include takeaway services that have entered groceries (such as Deliveroo). Then, despite the slower speed, there are now supermarkets and corner stores that provide delivery services, as well as Amazon’s supermarket services.
Once the promotion is over, will users establish strong enough habits or sufficient brand loyalty? The ultimate profit pressure means that not all of these companies will survive.
Mr. Salur said that he is not afraid of competition in fast grocery delivery. He hopes that every country has several companies, just like supermarket chains with competition. Waiting in the United States is Gopuff, which has operations in 43 states and is reportedly seeking a valuation of $15 billion.
Saruer, 59, sold a closed factory for many years, starting a business later in his career. Since then, his focus has been speed and urban logistics. He founded Getir in Istanbul in 2015 with two other investors, and three years later he created a ride-hailing app that can provide people with cars in three minutes. In March of this year, when Getir raised 300 million U.S. dollars, the company was valued at 2.6 billion U.S. dollars, becoming Turkey’s second unicorn, and the company was valued at more than 1 billion U.S. dollars. Today, the company is valued at $7.5 billion.
In the early days, Getir tried two methods to achieve its 10-minute goal. Method 1: It stores 300 to 400 products of the company in a truck that has been moving. But the number of products the customer needs exceeds the capacity of the truck (the company now estimates that the optimal number is about 1,500). Delivery of the van was abandoned.
The company chose Method 2: Delivery via electric bicycles or mopeds from a series of so-called dark stores (a mixture of warehouses and small supermarkets without customers), narrow aisles lined with shelves of groceries. In London, Getir has more than 30 black shops and has already started shipping in Manchester and Birmingham. It opens about 10 stores in the UK every month and is expected to open 100 stores by the end of this year. Mr. Salur said that more customers means more, not a bigger store.
The challenge is to find these properties-they must be close to people’s homes-and then deal with different local authorities. For example, London is divided into 33 such committees, each of which issues permits and planning decisions.
In Battersea, southwest London, Vito Parrinello, the manager of several illicit shops, is determined not to let the food delivery guys disturb their new neighbors. The dark shop is located under the railway arch, hidden behind the newly developed apartment. On both sides of the waiting electric scooter, there are signs that read “No smoking, no shouting, no loud music”.
Inside, you will hear intermittent bells to notify the staff that orders are coming in. The picker chooses a basket, collects the items and packs them in bags for the rider to use. One wall was filled with refrigerators, one of which contained only champagne. At any time, there are two or three pickers shuttled in the aisle, but in Battersea, the atmosphere is calm and quiet, which is far from the fact that their movements are accurate to the second. In the last day, the average time to pack an order was 103 seconds.
Mr. Parrinello said that shortening the delivery time requires store efficiency-it should not rely on drivers scrambling to customers. “I don’t want them to even feel the pressure of running on the street,” he added.
It is worth noting that most of Getir’s employees are full-time employees, with holiday pay and pensions, because the company avoids the gig economy model that has caused lawsuits by companies such as Uber and Deliveroo. But it offers contracts for people who want flexibility or only looking for short-term jobs.
“There is an idea that if this work is not a contract, it cannot work,” Mr. Salur said. “I don’t agree, it will work.” He added: “When you see the supermarket chain, all these other companies have hired employees and they will not go bankrupt.”
Hiring employees instead of contractors generates loyalty, but it comes at a price. Getir buys products from wholesalers and then charges a fee that is 5% to 8% higher than the price of a large supermarket. Most importantly, the price is not much more expensive than the price of a small local convenience store.
Mr. Salur said that 95% of dark shops in Turkey are independently owned franchises, adding that he believes this system can produce better managers. Once the new market becomes more mature, Getir may bring this model to the new market.
But this is a busy year. Until 2021, Getir will only operate in Turkey. This year, in addition to cities in England, Getir also expanded to Amsterdam, Paris and Berlin. In early July, Getir made its first acquisition: Blok, another grocery delivery company operating in Spain and Italy. It was established only five months ago.


Post time: Oct-25-2021

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