It’s disruptive in a certain segment and type of products. It will not eliminate the weekly family grocery run.

Eighty percent of these companies will end up going out of business. This is like the new Uber which, by the way, is still not profitable after how many years?

Yes this is convenient but Walmart and Amazon and Kroger will figure out a way to do the 80 percent and the 20 percent will be filled by one of these surviving companies.

it’s definitely something they should pay attention to and explore partnerships to benefit from their quick deliveries. Rapid grocers do not have full stock levels and delivery companies that partner with full grocers could be the ones that become most differentiated.

Rapid grocery is something all grocers should consider if they want to stay competitive. If we learned anything from the global pandemic, it’s that time is limited and customers are keen to spend time on the things and people that matter most. Rapid delivery gives customers back time and is the differentiator for many shopping decisions.

The competitive bar has been raised and most grocers have little choice but to respond. That’s why big players like Tesco, Carrefour and other are now exploring and experimenting in the space. The approach for this is usually to form a partnership as most grocers don’t have and don’t really want to build at this stage, rapid delivery capacity. All of this said, the profitability of rapid delivery is questionable and the pathway to profitability very unclear. It is also the case that rapid delivery is not suited or needed for all shopping missions, so it’s an additional service rather than a replacement for other delivery methods.

We will set expectations, the expectations won’t be met, the business will tank. We just don’t need things that fast. Grocers should keep an eye on it, but I’m more skeptical — especially when the pandemic ends. With the cost of groceries going up and up, I don’t think shoppers are looking to pay more.

Rapid innovation with small fast-delivery start ups will result in a wave of consolidation efforts by large grocers. Will this be super disruptive? I’m taking a contrarian view and saying I don’t think so. Despite what the BoxPoll says, ordering and receiving groceries beyond one hour, but in less than two hours is still highly convenient. It raises the question, what’s the differentiation aspect from the delivery competitors?

The pandemic has driven many new business models, which is great, but as we ease back to normality companies are going to realize that they may not be able to afford 15 minute deliveries without significant fees, which consumers will likely NOT want to pay — and we’re back to two hour windows for pickup/delivery.

Grocery retailers are facing a never before seen onslaught on both revenues and margins. Delivery companies like Instacart and GoPuff interjected themselves between grocers and their customers. In the short term there is an impact on margin, and in the long run they will lose sales as well. The dark stores and cloud kitchens add yet another place for customers to shop for commodity products. Grocery retailers cannot invest in last mile logistics and keep up with these specialized delivered players. Add to that, these delivery companies have deep pockets funded by venture capitalists, unburdened by need to be operationally profitable. That means they can invest a lot, in a very short time frame that normally run companies just cannot match. Some of these delivery companies themselves will go bankrupt, but will do enough disruption and damage in the process. Overall, I expect significant shakeout as good number of grocery retailers will get acquired or go out of business. The ones that are particularly at risk are those that are not capitalized enough, do not… Read more »

This is the natural evolution of unified commerce capabilities in grocery. The space race is on to find new competitive advantages in this space — 15-minute delivery would certainly be that. Traditional grocers need to pay attention to this. They’re already struggling with costs associated with order fulfillment for curbside and scheduled delivery. This will drive those costs up. There’s also the issue of scalability, especially in this tight job market. Grocers should be evaluating this from a cost/benefits perspective. This isn’t something that every store in the chain needs to provide I suspect. They should be prioritizing based on which locations, open or dark, can service the most customers within a reasonable proximity. They could also use their CRM/loyalty programs to find gaps in their networks where a dark store might make sense to service concentrations of outlying customers. Providing this service might be a way to drive loyalty by offering it to their best customers or loyalty program participants. They could use this as an incentive for a specific event. Larger grocers need… Read more »

For every action there is an equal and opposite reaction. In this case it will be price increases to offset the significant drop in profit that grocers will incur with the cost of implementing rapid delivery. It costs grocers an average of $20 to have staff pick and pack an order for delivery or pick-up, and that doesn’t factor in the cost of the actual delivery. Conversely, it costs about $7 for you or me to fill our own grocery cart in the store. The gift of time may be appreciated by the customer, but the math doesn’t work and will drive price increases, staff cuts and store closures, especially for publicly traded companies.

Rapid grocery delivery has a place, but will not usurp typical shopping behavior anytime soon. Consumers like the idea of on-demand groceries with super fast delivery, but are also generally not willing to pay a premium for the service, either in fees or higher prices. This pushes use towards convenience-based occasions – like needing a couple of ingredients for dinner vs. a larger stockup shop. Smaller basket sizes and higher last-mile delivery costs make it difficult to generate profit for a lot of startups in this space. The keys to success rest with technology, keeping a tight delivery circumference and managing margins though assortment and data analytics. This is where the large-scale operators – whether it is Walmart, Kroger, Albertsons or others have an advantage, especially when partnering with third-party delivery services like Instacart, DoorDash or UberEats.

It’s highly disruptive, but mostly in a bad way. For the most part, delivering groceries is an exercise in lighting a big pile of cash on fire. And while improving route density, robotics and the like can improve margins, it’s obvious that having the consumer do the labor by coming to the store has far superior economics unless grocers can find a way to adequately charge for convenience.

But the train has left the station on this competitively, and it seems pretty clear that Amazon is baiting other retailers to engage in a race to the bottom. As Seth Godin reminds us, the problem with the race to the bottom is you might win. Or worse, finish second.

Depending on where you live, it’s very important. I live in Miami. Even though there’s a Publix a few blocks away, Instacart has been relegated to some other, further location. The result is, in summer, my frozen products have often defrosted by the time they arrive.

Rapid grocery delivery will continue to be very disruptive in the grocery channel. Larger grocers are already building their own dark sub-stores in adjacent footprints and inside of their existing footprints. The model will continue, and grocers will need to determine their best path; partner or build their own.

The good news for many grocers is that they have built a lot of the infrastructure over the last few years as they developed BOPIS and self-service models. Additionally, in general, established grocers have a stronger supply chain process in place. Although they may need to look at segregating the breadth of products they offer in-store from the rapid delivery process.

Rapid grocery is the most disruptive trend to hit global grocery.

Consumers are becoming accustomed to ultra-fast food as the market expands with food delivery apps and restaurants delivering meals in minutes. As more players emerge and loyalty is up for grabs, more consumers are getting into the habit of choosing time savings and skipping the store.

Tech and delivery players add more spice to the competitive landscape. Recently Uber asked if I wanted groceries on the ride back from the airport, knowing my fridge would be empty. It’s a brilliant value-add: Uber’s already chauffeuring us around; they may as well feed us, too.

As e-grocery matures, grocers need reliable tech, logistics, delivery and marketing partners for seamless quick commerce. Grocers that build an efficient, pervasive network and master hyper-local marketing will win this food fight. Also, expect to see service excellence as more companies now cater to us like royalty to maximize convenience so we bestow them with our loyalty.

While more consumers will want rapid delivery groceries, many consumers will want to visit the grocery store to see the items before purchase, especially for produce and meats. With the increasing demand for the service, grocers will need to offer both in-store and rapid delivery just as the apparel retailers have done. Traditional grocers should partner with delivery services to offer in-store and rapid delivery options.

The need exists for some categories of groceries, but not all. If retailers want to introduce this in a competitive way, they’ll need to be strategic and selective with which items are available for the service. This can’t just be something retailers do to keep up with each other.

I don’t think rapid delivery is disruptive in the least. It is a premium service demanded by some who need it. They are the exception when it comes to shoppers your store depends on for profit – not the rule.

It’s not disruptive. It’s expected. It was disruptive before the pandemic. Then consumers recognized how convenient deliver is. Faster delivery — even more convenient. If you’re not offering delivery, be prepared to compete with the competitor who does.

The speculators are at it again. How many traditional grocers are valued at $15 billion, let alone the current scale of this business? It is madness. Yes there will be a market for rapid delivery companies but, as commented in the article, with no differentiation between them they will be low value and it will be difficult for them ever to make a profit. But when has that worried any VC!

The size of the market requiring or wanting delivery within 10 to 15 minutes is really quite small and as people start to realize how much they are paying for this service they are unlikely to use it on a regular basis. If traditional retailers decided this was a trend that has legs and real volume, they could easily replicate the service and challenge these startups wiping them out quite quickly. Let’s get real and keep our feet on the ground. The hype is fun but that is what most of this is, hype.

How disruptive the rapid delivery model is depends on which market and customer segmentation you are referring to. The last mile strategies are paying dividends to those grocery operations that have either established rapid delivery models or have leveraged third-party partnerships.

The more significant grocery operations, including Kroger, Albertsons, and Amazon/Whole Foods, have the capital, capacity, and capability to vertically integrate the rapid delivery operating model. The emergence of dark stores that only focus on rapid fulfillment is another example of a pivoting industry.

There will always be certain segments of customers that appreciate and enjoy the weekly in-store shopping experience. However there are those customers who have adapted to online ordering only, and their expectations are all around efficiency, rapid delivery, and convenience.

Not very — I would say in the 10-15% range of grocery, max. Rapid delivery will be most viable in urban sites, where physical commercial real estate is typical higher and urban environments can manage rapid delivery operations more easily at lower cost. However, very little of America is urban (~27% based on population). Add to that impoverished America who really can’t afford rapid delivery options and the overall disruption to grocery is further lessened. There is another multiplier that will reduce this market even further in terms of adoption and cooperation with existing suppliers and physical grocers, coupled with logistics. Despite the $760B+ market, making it a lucrative option for startups, it won’t be overtaking the grocery market anytime soon. Established grocers can experiment in this space, but best options will be tied to partnering with smaller, nimble firms or in some cases larger firms (e.g. Doordash/Instacart). The demand is not yet there and PB is a shipping and logistics firm that will push their studies to support more delivery. The importance doesn’t necessarily… Read more »

Rapid grocery delivery is something every grocer needs to consider offering if nearby supermarkets are offering it. That’s competition. That’s capitalism.

But the reality is that delivery that is fast, faster and fastest is getting out of hand. In fact, it is slightly absurd. How did shoppers live before such speedy deliveries? Oh, wait. I need a carton of eggs and milk in the next 15 minutes. Who ya gonna call?