Q comms - the new UK grocery retail sector

When I was little, retailers opened 9-5 and never on Sundays and groceries deliveries were more an image of the Hovis boy on his bike!

And now the world is changing at an alarming rate and none more so then the newly named “Q communications” retailers or to you and me, groceries delivered in ten minutes.?A new retail sector which is receiving billions of pounds of investment and set for phenomenal growth

?Gopuff was the first of these to be launched in 2013 by two students at Drexel University in the US to deliver emergency chocolate bars late at night. Its name was refered to how their student customers in Philadelphia would be smoking something when they ordered snacks between midnight and 4.30am, the service’s initial opening hours. The company is now in 650 cities across America and worth more than ￡10 bn. To put that in perspective, Morrisons has just sold for ￡7bn!!?They acquired Fancy in UK in May 2021 and also own Dija.

So if you thought you were talking to insignificant players….think again!

The key brand names in this market place are Dija, Weezy, Fancy, Jiffy, Zapp, Getir and Gorillas – two of whom have made their way to the Bread and Jam fest later this month to find new and interesting challenger brands

So WHO is the target customer – well it isn’t students!

?Their target audience is broad demographically but specific in their foodie interests - young professionals, families with children in their teens, baby boomers and people who love good food.?In August, Weezy reported their best selling products were avocados, bananas, lemons, Oatly (the oat milk brand) and strawberries!?And all are listing premium products such as truffles, locally sourced meat, bakery products and even kombucha. So if you are a challenger brand, it is likely that your people are shopping here!?And they do offer ambient, frozen and chilled. Often targeting those people who think "what shall I have for dinner?" and then want to order the ingredients without leaving their kitchen....in 10 minutes!

And whilst demographics are not everything, location may impact on your desire to be listed with them – see the detail below but at the moment they are based in high density urban areas so if your target customer lives in rural Cumbria, you might be out of luck!

What about the commercials?? They charge a delivery fee of course and then they do seem to have more premium retail prices – for example Little moons on Dija are ￡4.69 vs ￡4.50 on Ocado and Tesco which is about 4% premium.?No sure on the margins but I guess their running costs should be lower, so they will probably looking for a similar level to high street retailers

So they are well worth consideration as part of your retailer strategy - maybe to be part of their future and a fantastic opportunity to grow with them.

One last word of warning.??This market is new, emerging and likely to consolidate so be careful.?If you do a really good deal with one and not so great with the other – it is possible they will merge and you can guarantee they will want the better deal!! ?

Here is your summary guide to the key players (starting with the two attending Bread and Jam).?

Gorillas - German, fast-growing and worth more than $2.5 billion. Aiming slightly at the youth market for example they will deliver alcohol to parks

Claim:?Groceries at your door in ten minutes

Delivery:?￡1.80

Location:?London, Manchester, Nottingham, Reading, Southampton, Cambridge

Do they stock your competitors??The Flour Station bakery, Clarence Court eggs, HG Walter butcher, Beckett’s London gin, Itsu gyozas, Patty & Bun burger kits

Dija - British, set up by ex-Deliveroo executives. Slightly larger selection (4,000 items) and more upmarket than many rivals – targeting people who want to cook at home and need the ingredietns now!!

Claim:?Groceries delivered in ten minutes

Delivery?￡1.79

Locations:?London (South Kensington, Fulham, Hackney and will open 20 more hubs covering areas including Clapham, Wandsworth, Acton, Islington, Mayfair, Stockwell, and Clerkenwell), Cambridge, Paris, Madrid

Do they stock your competitors??Laurent-Perrier champagne, Sipsmith gin, Moving Mountains plant-based burgers, Deliciously Ella, Manilife peanut butter, Alvalle gazpacho

Weezy - British company, stocks over 2,000 items, including a fair amount of upmarket local products

Claim:?Quality groceries in minutes

Delivery:?￡2.95

Locations?London, Brighton, Manchester, Bristol

Do they stock your competitors? Lidgate’s butcher, Pizza Pilgrims, Joe & Seph’s popcorn, Sally Clarke bakery, Pasta Evangelists, Nyetimber and Hattingley Valley English sparkling wine

Getir - Turkish, since 2015, and valued at $7.5 billion. Focuses on snacks and essentials, a few Turkish and Polish specialities

Claim:?We deliver in minutes

Delivery:?￡1.99

Locations:?London, Manchester, Birmingham, Liverpool, Brighton, Cardiff and Bristol (targeting 15 cities by end 2021)

Do they stock your competitors? Gail’s bakery, Jude’s ice cream, White Rabbit vegan pizzas, Yeni raki, Efes beer, Caykur black tea

Zapp - British, delivers 24/7, more snacks and treats that serious grocery

Claim:?If they ever take longer than 20 minutes, they will make it up to you

Delivery:?￡1.99

Locations:?London, Manchester, Amsterdam, Paris

Do they stock your competition? Hackney Gelato ice cream, Aarne & Elsa baked rye chips, Doisy & Dam chocolate, Hip Pop kombucha, Salford rum, Cheshire Farm ice cream

Jiffy - London based, set up by two Russians who worked in e-commerce in Russia. Aims to match retail prices; not many upmarket products

Promise?Get the goods in just 15 minutes

Delivery:?Free

Location:?London

Do they stock your competitors? Ben & Jerry’s ice cream, the Flour Station bread, Kewpie Japanese mayonnaise, Cox & Co chocolate, Brew by Numbers beer

Fancy - based in university towns so more student orientated

Claim: Everything you need at your door in 30 minutes

Locations:?Newcastle, Manchester, Liverpool, Leeds, Bristol, Birmingham, Sheffield, Brent Cross, Nottingham, Cardiff

Do they stock your competitors??Gato chocolate, Tony’s Chocolonely, Baj’s Blazin’ Smokin’ Sister hot sauces, Oatly ice cream