“New retailers” is a sub-category of the Delivery sector. See all definitions of FoodTech and its categories here.
The “new retailers” FoodTech category regroups startups developing grocery e-commerce platforms, including farm-to-home solutions and delivery from stores.
Food e-commerce has been long to take off and the levels of penetration are very different from country to country (around 17-20% in China and South Korea, 8% in the UK and less than 1% in Germany). However, Covid has had a huge impact. The growth has been spectacular and the medium-term trajectory has been impacted with an expected growth significantly higher than what was previously projected.
The question is now much less about the existence of the food e-commerce market but much more about “how to make profits on it” and “who will master it”. As traditional players have been reluctant to enter food e-commerce, the market is open to new players. One should keep in mind that in the US alone, the grocery market was above $750B in 2020. This explains the flood of investments in this space oriented toward startups that are looking to disrupt the grocery market.
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New retailers
The new retailers are the startups that are looking to rebuild the infrastructure of a traditional retailer with a focus on e-commerce. Starting from scratch, they are able to use the new tools that traditional retailers have a hard time adopting. It means both software (how the supply chain is managed) and hardware (unified fleet of (often electric) vehicles, modern warehouses, etc.). In a word, they combine the best of both worlds: they are operated as startups but with the ambition and knowledge of a century of mass retail. This combination attracts a lot of investments, notably in Europe with a new generation of players that is able to make a dent in the market by growing food e-commerce sales in their markets and then by taking significant shares.
DigitalFoodLab’s additional insights
- 30/09/2021 – Grocery Delivery – 2 billions in 2 weeks
- 04/05/2021 – €1.8B invested in European grocery delivery startups in less than 4 months
- 14/04/2021 – Nordics grocery delivery startups Kolonial (Oda) and Mastmart raise money to scale internationally
- 11/03/2021 – Money is raining over grocery delivery startups
- 08/03/2021 – Rohlik and Picnic start to expand across Europe their grocery delivery operations
- 08/01/2021 – Huge growth in grocery delivery in China
- 03/07/2020 – Irish grocery delivery startup BuyMie raises €5.8M while Instacart raises $225M
- 11/05/2020 – Instacart, the Uber for groceries is booming during COVID-19
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