Online food delivery has taken off in recent years. During the pandemic these services allowed people to order good food and/or groceries despite being in quarantine. The quality of these services is improving quickly: More high-quality food products are added and the delivery process is getting quicker and cheaper.
Gorillas is a recent entry in this space. The German start-up allows users to order groceries through their app and promises to deliver them to you within ten minutes (!). The prices of the groceries are slightly above the prices of regular supermarkets, and the delivery costs are low at €1.80 per order.
To achieve quick delivery times, Gorilla has placed many small warehouses throughout a city with a select number of products. Typical products are fruit, snacks, ready meals, and (alcoholic) drinks. The service is positioned to deliver a few items, which are usually consumed on the same day. Groceries for a whole week can better be ordered through other grocery delivery providers like Picnic.
After placing the order, a picker will collect your items and they are delivered quickly using an electric bike. A typical scenario is to order beers and snacks before a night out. Instead of needing to travel to the supermarket, you can use the saved time to take a shower for instance. The good thing about the service is that Gorilla operates until 11:00 pm. This can be quite a night-saver.
But there are also some drawbacks, one major drawback may be that it`s becoming too convenient to stay at home. In this day and age, you can order anything from home, while working, or following lectures from home as well. Therefore, I believe that it may lead to people becoming more socially isolated.
In addition, it may disincentivize people to eat out at restaurants or drink in bars. Even though restaurants can register to sell their food products through online food delivery platforms, they are still at a disadvantage as the platform will receive a major commission. Therefore, restaurants, bars, and other food businesses may have a harder time making a profit. It would be concerning for lively restaurants to disappear from the city-centers, and be replaced by less personal warehouses just because they can`t make enough money.
As such, Gorilla and other online food delivery services have made life more convenient and were of great help during the pandemic, but we should consider the social impact it may have as this industry keeps on developing in the future.
To ask a question to you, what`s your take on the benefits and drawbacks of online food delivery services? Do you think it`s becoming too convenient to stay at home? Feel free to comment
A very interesting post you have written, Jelle. Gorillas is indeed fast in terms of delivery. That’s the advantage of having a small selection of items and well distributed warehouses. These quick deliveries are not (yet) feasible for PICNIC for example, because of they have less but bigger warehouses that are often remotely (e.g., in an industrial area) located in big cities. In addition, PICNIC also motivates customers to order more, since the minimum order value has to be 35 euro to get free delivery. During the time I worked there (2019-2020) this value was 25 euro. Probably to motivate customers to order more while getting higher margin per delivery.
Another drawback of online food delivery services is that customers often receive (partly) broken items. This happens a lot and is also negatively impacting the environment since it is food (and packaging) waste. Good examples are eggs, crisps and meat that’s packed with a thin piece of foil. You can feed a village with all the waste in one day. A benefit of it is that, especially in the case of Gorillas, people don’t unnecessarily use the car or other polluting vehicles to go to the store just to buy that one that one snack and meal. Gorillas (as wel as PICNIC) respond well to this with their electric delivery vehicles.
Thanks for your comment Vicent. It`s interesting that Picnic increased its minimum order value from 25 to 35 euro to get free delivery. They may indeed want to increase the order size & margin per delivery, which probably means that small orders are currently not profitable for Picnic. For Gorilla, on the other hand, I would think that most orders are small and below 25 euro. So in that sense, they operate in different segments of the grocery delivery industry, and the entry of Gorilla may satisfy this small order segment which picnic started to move away from.
Since you worked at Picnic, you must have gotten insight into the waste of food & packaging due to broken items during food delivery. I was unaware of the scale of this problem, so thanks for this insight. Another interesting argument that you make is that Gorilla (and picnic to an extent) may reduce pollution as people don`t have to use the car or other polluting vehicles to buy just a few groceries. Yet, since Gorilla mostly operates in the larger cities, where supermarkets are generally closeby, and there may be inconvenient routes for a car and parking problems at the destination, it is quite likely that bikes are preferred over cars to get to the supermarket for small groceries. So I am not sure if this argument holds.
But it raises an interesting question, which of the two methods is more sustainable, the traditional method of people going to the supermarket or the new method of food delivery.