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The Spoon

Daily news and analysis about the food tech revolution

grocery delivery

Uber Launching Grocery Delivery in U.S. Amidst Record-Setting E-Commerce

Uber announced today that it will launch grocery delivery in select cities this month. The announcement comes at a time when the global COVID pandemic has spurred consecutive monthly record-setting grocery e-commerce sales in the United States.

From the Uber blog post announcing the news:

Starting today, in collaboration with our partner Cornershop, customers in select cities in Latin America and Canada can order groceries through both the Uber and Uber Eats apps. And starting later this month, grocery delivery will be available in Miami, FL and Dallas, TX. In those two cities Eats Pass and Uber Pass members will receive an additional benefit, free grocery delivery on orders over $30. 

According to Grocery Dive, the service will be available through the Uber and Uber Eats apps, where users can select a participating retailer and order their groceries. And though Cornershop is fulfilling orders now, Uber drivers will be able to sign up to make grocery deliveries.

Uber announced last October that it was acquiring a majority stake in Cornershop, an online marketplace for on-demand delivery from supermarkets across Chile, Mexico, Peru and Toronto. That deal still hasn’t gotten formal approval from the Chilean government, though Uber believes that will happen in a matter of days.

This grocery expansion news comes just one day after Uber announced that it was acquiring third-party delivery service Postmates for $2.65 billion. Both the Cornershop and Postmates deals show how Uber is bolstering its Eats delivery business at a time when the COVID pandemic and quarantining is hammering its ride sharing business.

The pandemic is also driving a grocery e-commerce boom. According to surveys from Brick Meets Click, online grocery shopping has had month-after-month of record setting sales as restaurants were shut down and people were forced to shelter in place. With the pandemic showing no signs of slowing down here in the U.S., getting into grocery is a smart move for Uber.

Uber is, however, facing stiff and well-funded competition. Last month, Instacart raised $225 million (and has raised $2.1 billion in total) as it has seen a surge in demand. It was also ratcheting its ranks to 750,000 Shoppers (the gig workers who shop and deliver) to increase delivery availability. Not to mention huge grocery retail players like Walmart and Amazon making and expanding their own delivery programs.

For its part, however, Uber does have a large installed user base from ride sharing and restaurant delivery that it can tap into. Now we’ll have to see what kind of an impact it can make when it comes to getting people groceries.

Refraction AI Officially Launches Robot Grocery Delivery in Ann Arbor, MI

Refraction AI, which makes the three-wheeled autonomous REV-1 delivery vehicle, announced today that it is expanding beyond restaurant meals and into grocery delivery.

The company’s robots are delivering around a three-mile radius in Ann Arbor, MI, and today’s announcement is basically an official unveiling of a program that the company has been testing for months.

If you are in the Ann Arbor delivery and want to check out the delivery service, visit this site that Refraction has created. The company is working with a local grocer called The Produce Station, and it looks like the process is a little kludgey right now. Customers need to visit Produce Station’s Mercato store to see what items are available, and then manually enter the items they want into special form on Refraction’s site. The robot is then dispacted to the store where staffers pack the items into the vehicle before it drivers itself to the delivery location.

It’s understandable that Refraction’s process might not be the smoothest. After all, the company is in the robot business, not the e-commerce business. But it makes me wonder how how the company will connect consumers and robots as it grows beyond Ann Arbor? Will restaurants and grocers have their own REV-1s running back and forth? Or will a third-party delivery service like DoorDash have a fleet of them deployed to make deliveries? Or will it be a combination of both?

Autonomous robot deliveries are attracting more attention during this COVID-19 pandemic as they can reduce human-to-human interactions and, hopefully, human-to-human viral transmission.

Refraction’s REV-1 is a Goldilocks robot, in that its size is right in between the small cooler-sized rover bots of Starship and the big pod-like vehicles of Nuro. This sweet spot of a size, plus the REV-1’s ability to handle inclement weather was one of the reasons we named Refraction AI to our 2020 Food Tech 25 list of innovative companies.

Dumpling Raises $6.5M Series A for Grocery Delivery Platform

Dumpling, an online platform that allows people to start their own grocery shopping and delivery business, announced today that it has raised $6.5 million in Series A funding. The round was led by Forerunner Ventures, with participation from Floodgate and Fuel Capital. This brings the total amount raised by the company to $10 million.

Unlike Instacart, which is a grocery delivery company that directs independent contractors, Dumpling is a platform for individuals to start their own grocery shopping and delivery business. These business owners, as Dumpling refers to them, set their own pricing and delivery areas, and develop their own clientele. Dumpling provides not only the technical and payment infrastructure for its shoppers, but also coaching on how to build and market their businesses.

I spoke with Dumpling Co-Founders and Co-CEOs Joel Shapiro and Nate D’Anna by phone this week. According to them, this approach means more empowerment and money for its business owners, and more choice for the end customer. Shapiro and D’Anna said that Dumpling shoppers earn $33 per delivery (and that’s a pre-pandemic number, which has since gone up given record setting grocery e-commerce).

Additionally, because Dumpling is not affiliated with any one grocery store, Dumpling shoppers are able to shop at multiple stores for a single order, so a person could get their favorite snack from Trader Joe’s and a six-pack of Coke from Safeway delivered at the same time from the same person.

The system isn’t perfectly efficient yet. Dumpling is not plugged directly into the inventories of store. So instead of tapping on items in an app, a customer may need to write out actual lists or send photos of the products they are looking for.

Dumpling makes its money by charging a 5 percent fee per order, which the business owner can pay or pass on to the customer, as well as a set monthly fee or $5 per transaction to the business owner to be on the platform.

Today’s funding announcement comes on the heels of grocery delivery giant Instacart raising $225 million last week. While Instacart has raised $2 billion so far, Dumpling’s more hands-off, DIY approach to its shoppers could keep it competitive because it pushes the marketing and business building on to its shopper network. Plus, at least so far, Dumpling hasn’t run into the same labor issues that Instacart seems to run afoul of.

Dumpling’s funding is also coming at a time when states are re-opening and people are starting to go back into grocery stores. How much people retain their online grocery shopping habits remains to be seen, but it appears that the peak for online grocery shopping may have passed (at least for now).

There are currently 2,000 Dumpling business owners operating in all 50 states. The company said that it will use its new funding to develop tools that allow its business owners to shop and build out their individual businesses more efficiently.

Irish Grocery Startup Buymie Raises €5.8M, Expands Into UK

Buymie, a grocery delivery company based in Dublin, Ireland, announced today that it has raised €5.8 million (~$6.53 USD) in new funding. The round was led by Wheatsheaf Group, the food and agriculture investment arm of the Grosvenor Estate, with participation from existing backers Act Venture Capital, Sure Valley Ventures, Haatch Ventures, and HBAN.

This is the second funding announcement from Buymie in as many months. This new cash appears to be an add-on to the €2.2M (~$2.39M USD) Series A round the company started in April of this year. This brings the total amount of funding for Buymie to €10.6M (~$11.93M USD).

As we wrote back in April, Buymie is analogous to Instacart here in the U.S. Customers order through the app and Buymie shoppers go into stores like Lidl and Tesco to pick items out and make home deliveries.

Right now, demand for grocery delivery is skyrocketing because of the coronavirus pandemic. In April, Buymie told the Irish Times that it was experiencing 39 percent month-over-month growth and had seen a 300 percent increase in app downloads.

Back then, the company’s services were available to 490,000 households in the greater Dublin area. As part of today’s announcement emailed to The Spoon, Buymie said that it has just launched in the Bristol metropolitan area of the UK, the company’s first such expansion outside of Ireland. With its new funding, Buymie says that it will continue rapid growth to new markets both in Ireland and the UK.

Buymie’s fundraise comes just days after Instacart announced it had raised an addition $225 million to keep up with demand for grocery delivery here in the U.S. It appears that investors, at least, aren’t worried about demand dropping off too precipitously as lockdown restrictions start to ease.

Walmart Launches Two-Hour Express Delivery as Grocery E-Commerce Surges

Walmart announced Express Delivery, the company’s zippy new two-hour delivery service for food and other goods, yesterday. The new service comes in the middle of a global pandemic that has spurred a drastic wave of demand online grocery shopping.

According to the press announcement, Express Delivery was being tested in 100 stores since Mid-April. In early May, the service will broaden to nearly 1,000 stores before rolling out to 2,000 total stores in the ensuing weeks. Express Delivery costs an additional $10 on top of the initial delivery fee.

The obvious motivation for Express Delivery is simply that more people than ever are shopping for groceries online. In fact, a survey out this week from Brick Meets Click found that online grocery sales hit $5.3 billion in April, up 37 percent over March (which was its own record-setting month). Order number, size and frequency are all up as well.

In March, a market research study from Gordon Haskett Research Advisors found that Walmart was the top destination for those shopping for groceries online. So the company has been bearing the brunt of this crush of online shoppers.

Walmart, as well as every other grocery retailer, has been struggling to keep up e-commerce demand. It was looking to bring on an additional 150,000 workers this Spring to keep up. In addition to delivery and now Express Delivery, the retailer also expanded its contactless curbside pickup options.

Back before the dark times, Walmart was in the midst of working on Walmart+, its answer to Amazon Prime. Walmart+ reportedly would expand on Walmart’s Delivery Unlimited subscription service as well as offer perks on things like prescriptions and gas.

Speaking of Amazon, Walmart’s Express Delivery also brings it up to speed, as it were, with the two-hour delivery Amazon offers for free to its Prime members. Once this pandemic recedes, it’s not too hard to imagine Walmart’s Express Delivery, having been scaled and battle-tested by COVID-19-driven demand, would be a benefit of Walmart+.

For those interested in trying out Express Delivery, visit walmart.com/grocery or the Walmart app and search for your ZIP code to see if Express Delivery is offered in your area.

Ireland Grocery Delivery Startup Buymie Raises €2.2M

Buymie, a grocery delivery startup based in Dublin, Ireland, announced this week that it has raised €2.2 million (~$2.39M USD) and extended its partnership with German supermarket chain Lidl for another two years. The Irish Times first reported the news on Tuesday. ACT Venture Capital led the round, with participation from Sure Valley Ventures and Eamonn Quinn Buymie’s chairman. This brings the total amount raised by Buymie to €4.8 million (~$5.21M USD).

Like Instacart here in the U.S., Buymie’s workers go into Tesco and Lidl stores to shop for items then deliver them to customers’ homes in as little as an hour. Buymie is available to more than 490,000 households in the greater Dublin area, and the company will use its new funds to build out its service and expand into a second city.

Demand for grocery delivery in Ireland has skyrocketed during the coronavirus pandemic. Buymie told the Irish Times that the number of monthly active customers is growing up 39 percent month over month, and that there’s been a 300 percent increase in the number of downloads for its app.

However, all this rapid growth has a downside as customers are now facing weeklong delays before delivery windows open up. Hence the need for Buymie’s fresh capital raise to scale accordingly.

The need to scale quickly is a situation U.S. grocers are all too familiar with. Shelter in place orders have resulted in a surge in online grocery shopping, forcing even the biggest grocery companies to scramble in an effort to keep up. Amazon has put new Fresh and Whole Foods customers on a waitlist before they can get deliveries. ShopRite has put customers in a virtual waiting room before they can even shop. And delivery service Instacart is swelling its ranks of Shopper gig workers to 750,000 to keep up with demand.

Here in the U.S., some states are starting to relax shelter in place orders, which raises the question of whether or not the desire for online grocery shopping will remain. A recent survey showed that 60 percent of American shoppers are “fearful” of actually going into the grocery store. So while grocery e-commerce may not be full throttle, it probably won’t disappear completely once people are allowed to leave their homes.

I’m not sure what the situation is like in Ireland, but everyone eats, and it looks like Buymie’s funding is coming at the right time.

Refraction’s “Goldilocks” Size Could Make it Pretty Great for Robot Grocery Delivery

Contactless delivery as a concept, didn’t exist prior to the COVID-19 pandemic. The phrase describes the way of delivering food and other goods without humans having to interact with or touch one another.

Delivery robots hold the promise of taking contactless delivery one step further, by removing humans from the equation altogether. Over in Ann Arbor, MI, Refraction.ai launched its robot fleet for restaurant lunch delivery earlier this year, and this month started piloting a grocery delivery service.

Refraction builds the REV-1, an autonomous three-wheeled delivery robot that is ruggedized so that it can handle inclement weather. The company has eight robots rolling through a 3.5 mile radius around Ann Arbor right now making deliveries , with another 15 robots being manufactured.

I first came across Refraction’s grocery work in a WIRED article about the delivery fees Refraction was charging. So I hopped on the phone with Refraction Co-Founder, Ram Vasudevan, to find out more about its grocery program and catch up with the company.

According to Vasudevan, Refraction has partnered with a local grocery store called the Produce Station and has another grocery partner coming online soon. The program is currently being tested and is not yet open to the public, but for now, customers are directed to a special website created by Refraction where they can shop online for food items just as they would from any retailer. A robot is dispatched to the store where a worker there packs it with the order (a REV-1 can hold six grocery bags). The robot is then sent off to the house for delivery with a text message alerting the shopper when the robot has arrived.

The Refraction robot isn’t completely contactless, however. Recipients still need to touch the robot to unlock it, something Vasudevan says the company is working on. Refraction is also looking to add UV lights to the cargo cavity to help with sanitization.

Refraction isn’t the only company that is doing robotic food delivery. Starship’s cooler-sized robots have been doing grocery delivery in Milton Keynes, England, and are now doing restaurant delivery in U.S. cities like Tempe, AZ and Fairfax, VA. And Nuro was given the greenlight by California to start testing its autonomous pod vehicles, which about half the size of a regular car, for deliveries as well.

But one advantage Refraction’s robot may have is its “Goldilocks”-like size. It stands five feet tall and is narrow enough to travel in the bike lanes on roads . This could potentially make it more friendly to city regulators who don’t want their sidewalks clogged with robots. It could also prove more attractive than a pod, because the robot can skooch off to the side to make way for traffic, and have an easier time finding enough space to park.

Vasudevan said that Refraction was “overwhelmed” with interest from restaurants when it launched that delivery option earlier this year. As the company moves past the testing phase, it’s going to have quite a bit of contact with grocers as well.

Instacart Now Has 500,000 Shoppers, Adding Another 250,000 to Meet Demand

Instacart appears to be right smack in the middle of a Venn diagram of the humongous demand for online grocery delivery and decimated job market where people need work.

Exactly one month ago Instacart announced that it would add 300,000 new Shoppers (the gig workers who do the shopping and actual delivery) to its ranks over the ensuing three months. Today, the company announced that not only has it already met that goal, bringing its total Shopper count to 500,000, but it is adding another 250,000 Shoppers to keep up with orders.

According to a press announcement emailed to The Spoon, Instacart’s order volume grew by more than 500 percent year-over-year last week, and average customer basket sizes increased by 35 percent. The quarter-million new Shoppers will be focused on 6 main regions with the most demand including California, Massachusetts, New York, Pennsylvania, Washington D.C. and Toronto.

Grocery retailers and delivery services like Instacart have struggled to keep up with the sheer volume of online grocery orders from people sheltering in place. Actually getting a delivery time can be worth more than gold in some regions of the country, with delivery window only available weeks out. Earlier this month, Instacart added new features like order ahead to help alleviate some of the strain. But ultimately, with stay at home orders seeming like they will be here for a while for most of the country, Instacart just needs people.

This need for more Shoppers also comes at a time when a record number of people are losing their jobs. With restaurants closing along with other non-essential services there are millions of people looking to make some much-needed money. Being a gig worker won’t provide benefits, but it can mean making an income.

It’s important to remember, however, that these eventual 750,000 gig workers are also putting themselves at risk. They are going into the grocery stores and bringing food to the people who won’t leave their own houses for fear of catching the virus.

Along with today’s headcount announcement, the company also announced another round of new COVID-19 protections and services for its Shoppers. Instacart now has a daily in-app Shopper wellness check to monitor health, extended sick pay for workers afflicted with or isolated by COVID-19, extended bonuses for in-store teams until the end of the pandemic, and easier access to health and safety kits.

Instacart’s COVID-19 response record has been mixed at best. Shoppers got so fed up with what they perceived as insufficient protections that they went on strike earlier this month. Though labor relations evidently haven’t stopped people at home from using the service (just make sure you tip generously if you do!).

With more people getting used to shopping for groceries at home, this demand for Instacart could be sustained for some time even beyond the pandemic, requiring hundreds of thousands of more Shoppers.

Want to Sign Up for Amazon or Whole Foods Grocery Delivery or Pickup? You’ll Have to Wait(list)

Grocery delivery has been a lifeline for those unable to visit supermarkets in person and those just trying to flatten the viral curve. But there’s been a rush to grocery e-commerce, and if you’re just now trying it out, there’s a good chance that you’re gonna have to get in a virtual line.

Amazon announced today that it is instituting a waitlist for new online Amazon Fresh and Whole Foods customers. From a blog post outlining a number of changes the company was making in the wake of the COVID-19 pandemic:

We are temporarily asking new Amazon Fresh and Whole Foods Market delivery and pickup customers to sign up for an invitation to use online grocery delivery and pickup. We’re increasing capacity each week and will invite new customers to shop every week.

Also in that announcement was the news that Amazon’s Woodland Hills, CA location, which was to be the first of its full-on supermarket locations, was opening as an online only order fulfillment center. Thankfully, that location appears to have robots to help with order processing.

Amazon isn’t the only company struggling to meet the crush of new demand in online grocery. Eater reported last week that FreshDirect and Instacart customers in NYC were staying up all night to try and get delivery slots. Grocery Dive wrote today that some ShopRite customers are being placed in virtual waiting rooms before they can shop (Ocado and Morrison’s shoppers in the UK face similar situations). And anecdotally speaking, my local Safeway’s delivery is full through the rest of this week, with no option to schedule beyond that.

All this is to say that grocery retailers, even the big ones, are having a hard time with all this craziness. Though they are all hiring like crazy, the infrastructure just wasn’t in place to handle years’ worth of growth in a matter of weeks. Hopefully, grocery retailers will be able to get their processes all ironed out so people will be able to get their food, while keeping all those store and delivery workers safe.

In the meantime, if you’re an existing Amazon/Whole Foods online customer, you can try this free downloadable tool that alerts you when delivery slots from the company opens up.

Instacart Adds New Order Ahead and Delivery Range Options

Anyone who has tried to use Instacart in recent weeks may have noticed considerable delays and wait times for grocery delivery. The startup is bearing the brunt of the sudden surge in demand for online grocery shopping as people across the country are ordered to shelter in place.

Though Instacart will bring on 300,000 new shoppers (the gig workers that actually go into the stores, pick out the items and make deliveries) over the coming months, some of that demand pressure needs to be relieved now. To help, the company today announced new “Fast and Flexible” and “Order Ahead” delivery options, meant to help consumers better navigate availability.

The Fast and Flexible option lets Instacart users have their order delivered by the first available Instacart shopper, instead of scheduling around a specific delivery window. Once chosen, users are given an estimated delivery range (like Monday – Wednesday) and are notified when a shopper picks up the order.

The Order Ahead option is pretty much what it sounds like, customer have the option to place order up to two weeks in advance. Up until now, orders could only be placed seven days in advance. Instacart’s Order Ahead is only available “in a number of high demand locations” today, and will be rolling out across North America over the next few weeks.

Of course the issue with order ahead, and all grocery delivery is the fact that what you order online may not be in stock when it’s time for delivery. A problem not specific to Instacart and one that I hope gets addressed soon.

Instacart has had to adapt quickly to meet the needs of a new reality where going to the grocery store means risking exposure to a deadly virus, and not every response from the company has been great. Instacart’s shoppers are now on the frontlines of this pandemic, braving stores and making deliveries to strangers’ houses. Fearing for their safety, Instacart shoppers went on strike last week protesting the lack of protective equipment and adequate pay during this dangerous times. Instacart responded with a number of new measures to address the situation, and it seems like the strike hasn’t dampened the public’s demand for delivery.

The new features announced today will certainly make it easier for consumers to order more groceries through Instacart, which means more exposure for Instacart shoppers. Let’s hope those same consumers are tipping their shoppers generously well as a thank you.

Swiggy, Zomato Expand Delivery Services to Groceries and Beyond in India

Swiggy, one of India’s biggest food delivery services, announced this week it has raised $43 million as part of its ongoing Series I round. The round was led by existing investor Tencent, and new investors Ark Impact, Korea Investment Partners, Samsung Ventures and Mirae Asset Capital Markets. it brings Swiggy’s total funding to date to $1.42 billion and values the company at $3.6 billion, according to TechCrunch.

The round is also part of Swiggy’s ongoing efforts to expand its business from restaurant food delivery to include other items, including grocery, laundry, and other household items. The company says it will use the new funds to address market gaps in those areas.

Pre-pandemic, Swiggy was already headed in this direction. Two services, Swiggy Stores and Swiggy Go, launched in 2019 to deliver grocery, medicine, house keys, and many other items to customers within a one-hour timeframe.

With cases of COVID-19 on the rise worldwide, the company isn’t alone in branching out from restaurant meals — more services that traditionally peddled only restaurant food are widening the range of products they can deliver. DoorDash recently expanded its food delivery capabilities to include convenience-store items from 7-11, Wawa, and other such places. Postmates has a delivery partnership with Walgreens through which customers can get wellness products, medicines, and general household items. 

Those examples are in the U.S., though. In India, expanding into new delivery categories could give Swiggy a competitive edge at a time when the entire country is on lockdown and most business is disrupted. However, Swiggy’s biggest competitor, Zomato, has also gotten hip to the potential profitability of delivering more than just restaurant meals. The service just announced Zomato Market, which identifies nearby grocery stores delivering goods and delivers items.

Zomato also bought Uber Eats’ business in India earlier this year, creating a two-man race in the India food delivery market. With 1.3 billion people in the country on lockdown right now, there are plenty of customers to go around. Post-pandemic, whenever that is, the market may become more of a race to see which service can better prove profitability.

DoorDash Launches Convenience Store Delivery with 7-Eleven, Circle K, Wawa and More

DoorDash announced today that it is expanding its food delivery operations into the convenience store category. The delivery service has partnered with regional and national convenience stores such as 7-Eleven, Wawa, Casey’s General Store, and CircleK to drop off items like sodas, snacks and over-the-counter medicine at your door (with no human-to-human contact, of course).

DoorDash didn’t say specifically where in the U.S. its new convenience delivery is available, only that it added more than 1,800 stores to its platform. Where available, DoorDash users will see a “Convenience” icon or banner in the app. Upon clicking that banner, you can shop for the packaged goods you’d normally buy at a convenience store.

In a corporate blog post announcing the new service category, DoorDash’s Head of Grocery Partnerships, Mike Goldblatt, and Fuad Hannon, the company’s Head of New Business Verticals, wrote that DoorDash piloted the service earlier this year but has accelerated its official launch to accommodate needs “during a time when delivery and pickup are vital to consumers’ wellbeing and to the health of our local communities.” See also: global pandemic upending pretty much every aspect of our everyday lives and every previous business plan for startups.

DoorDash Convenience in action

Another good reason for DoorDash to expand its service categories is that its main clientele, the restaurant industry, is in the midst of an unprecedented collapse. Social distancing has forced the closure of restaurant dining rooms across the country. While some are pivoting to delivery only, the economics of restaurants relying on third-party delivery services like DoorDash remains to be seen.

Coincidentally, DoorDash’s announcement comes on the same day that Uber Eats announced it was expanding into more grocery delivery via convenience stores in France, Spain and Portugal.

Providing groceries via convenience stores make a lot of sense for third-party delivery services like DoorDash and Uber Eats. They can fulfill quick-hit food needs that aren’t full-on supermarket shopping trips. This not only allows for faster and therefore more deliveries (and more revenue), it also doesn’t turn delivery people into grocery shoppers wandering around a giant supermarket, hand-selecting produce, chips, etc.

Of course, at a time when delivery services grocery stores and through Instacart are being slammed with new users, having this type of quick hit delivery for small things could relieve some pressure and provide relief for those stuck at home.

The coronavirus outbreak is accelerating a lot of changes to food tech businesses. DoorDash’s expansion into convenience stores is just among the many we’ll be seeing as this pandemic continues.