Ultrafast grocery delivery start-ups came with a bang but seem to have fizzled out in a jiffy. Their apparent debacle however has somewhat created a little gap in the market which local independent stores are best placed to cater to.
Instant or quick grocery delivery firms burst onto the UK market during the pandemic, becoming the poster child of tech start-up world, their so-called “golden egg”.
Between 2020 and 2021, companies promising to bring essentials to your doorstep in 15 minutes or less collectively raised more than £5.34bn.
This gigantic level of investment gave birth to many new and revamped some existing speedy grocery delivery brands like Gorillas, Zapp, Jiffy and Getir. They hired en masse and expanded into new markets at breakneck speed. Established food delivery brands, notably Deliveroo and Just Eat, also jumped in, venturing into the space, alongside the big supermarket giants themselves.
Usage of rapid grocery delivery apps quickly soared with heavy discounting and attractive introductory offers encouraging rapid customer uptake. These companies were typically marked by flashy branding, aggressive marketing and steep discounts.
During its peak in 2020 and 2021, it was often said that quick or rapid grocery delivery services would eventually change the grocery-buying habits of Brits, thus potentially threatening independent convenience stores. However, in less than two years, the landscape has changed back dramatically. As the threats of Covid subsided and fears of inflation and recession took over, changes had to be made again, this time to cut down on spending. As a result, convenience took a back seat as focus shifted to save extra costs.
Delivery eats itself
Some of the start-ups that enjoyed instant fame during the pandemic have since been acquired by the more successful players while some are barely surviving.
Mergers, closures and a funding slowdown have reshaped the rapid delivery space, leaving fewer players standing. Many of those remaining are scaling back operations and pulling out of geographical markets. One indicator that consumer desire for speedy delivery is slowing down is the reduction of downloads of the apps. All the major speedy grocery apps have seen year-on-year dips in their download rates.
British startup Zapp has seen the biggest drop in downloads between Q3 2021 and Q3 2022, with 91 per cent fewer downloads. Getir dropped 45 per cent, Flink 47 per cent and Gorillas 61 per cent. Only GoPuff saw a less than double-figure drop – with just a 6 per cent fall.
Fleets of drivers to fulfill the promise of speed, the rising cost of fuel, and the running costs of office space, wages, advertising and discounts sucked up the funding. May 2022 is deemed as the crunch month in the industry. In the space of two days, German grocery app Gorillas, Turkish app Getir and British app Zapp laid off workers, closely followed by news of market exits.
Getir delivers groceries in cities in as little as 10 minutes from so-called "dark stores" - city-centre depositories - charging a mark-up on supermarket prices.
Though it secured a £410m cash infusion recently, media reports say the company bleeds an estimated £80m per month. Getir has lost 80 per cent of its valuation since spring 2022.The company recently laid off 2,600 people and shuttered operations in Italy, Spain, and Portugal. The Turkish firm, which has 23,000 staff in markets such as the UK and Germany, said the cuts would improve "operational efficiency".
Today, Getir is said to be “nowhere near” in establishing a clear path to profitability. Quick commerce industry experts like Sujeet Naik, an analyst at Coresight Research, has cautioned the company to “fix its model first”.
Berlin-headquartered Gorillas launched in London in 2021, with an aggressive marketing campaign and fast-paced establishment of dark store locations that quickly cemented it as a major player in the UK rapid grocery delivery scene.
Gorillas, fueled by millions of dollars of venture capital, soon reduced its UK workforce and withdrew from five British towns and cities. It was later acquired by Getir.
Even the acquisition of two of the largest players in the sector saw cuts to their valuations in the deal terms. Experts even state that Gorillas had no other choice but to sell, as despite the rapid head count reduction, the path to profitability was going to take a lot longer than the burn rate.
While Getir’s acquisition of its rival Gorillas was widely seen as a victory, those who came from Gorillas point to systemic challenges they were facing that suggest Getir too is cutting corners. Riders often raise issues like faulty batteries, pressure to hit faster delivery times, against computer-generated estimates that fail to account for traffic, stairs, or a failing battery on a poorly maintained bike.
Buzz on social media was that Getir’s UK arm was reportedly auctioning off motorbikes, helmets and even fridges in an attempt to mitigate cash flow issues. Staff were also asked to go door-to-door offering discounts and free merchandise to boost sales.
Now the Turkish startup once valued at almost £9bn is chasing growth by making its service available via Uber’s platform in a bid to tap a larger user base. Getir says it’s drawing on Gorillas’ network of dark stores to power the grocery delivery partnership with Uber Eats.
It’s not only about Getir and Gorilla. Several instant grocery delivery apps have fallen like a pack of cards over the last 18 or so months.
Founded in London in 2019, Weezy picked up more than about £16m funding in less than two years. It never made a profit, however, its acquisition by Getir spared it from facing the bursting rapid delivery bubble.
London grocery delivery upstart, Jiffy nabbed £23m in Series A funding around half a year after initial £2.6m seed raise. Jiffy had all the typical features of archetypal rapid grocery delivery startups- sending supermarket products straight to consumer’s homes in minutes from dark store locations.
In 2021, Jiffy made just under £2m in revenue compared with pre-tax losses of £9.5m. Jiffy has now changed paths and has pivoted away from its consumer-facing delivery business to focus more on providing software to other ecommerce brands.
Zapp is trying to be unique with a premium model in which it focuses on serving more affluent areas. Costs for consumers are also higher, based on the idea that the products being purchased are of a better quality. It reported losses of £76.2m on turnover of £11.5m in 2021.
Zapp has now realigned all its resources solely to London after exiting markets such as the Netherlands and other British cities like Manchester.
The rise of Locals
Providing last-mile or home delivery to its customer base was not a new concept for local stores and corner shops. They have been doing this for decades, majorly through orders placed through phones and mobiles.
At the time of the pandemic, most local retailers further rose to the occasion while several of them started offering quick and instant grocery delivery in their communities. While many maintain their own fleet of vehicles, including electric bikes and electric cars, with some also coming up with their own independent apps for placing delivery requests, a lot many more resort to third party delivery services like Snappy Shopper.
Snappy Shopper partners with thousands of small business owners who have been serving their communities for years, some for generations, enabling them to not only serve their customers better but grow their own business reach geographically as well.
Dundee-based Snappy Shopper has raised a seven-figure sum to invest in the convenience store home delivery platform’s growth plans and core technology.
The company has achieved triple digit average annual revenue growth since its inception in 2018, hitting the 50 million products sold and more than five million orders placed through the platform milestones during 2022.
Noteworthy here is that the Scottish firm charges the same amount for products as in store, while competitors impose a significant mark-up.
For retailers like Glasgow-based Premier store owner Girish Jeeva, home delivery through Snappy Shopper adds another funnel of extra sales.
"When we first started on the Snappy Shopper platform, we were only doing £500 weekly sales but this has increased majorly reaching £10k- £13k and is still growing to this day,” he says.
“This requires us to have at least 2-3 drivers on shift each day as well as having backup drivers to cover busy periods such as our 1p deals run in tandem with Snappy Shopper. These deals help us to help our customer base during times when a lot may struggle, such as the holidays. We have reached 500+ deliveries weekly and this is increasing week in and week out thanks to the service and experience we provide,” he adds.
For retailer Imran from Londis Kings Park in Glasgow, £8,000 a week comes from Snappy Shopper with 80 per cent coming from new customers who otherwise don’tcome to the shop.
Retailer Raj from Premier Rawmarsh in Sunderland states that the Snappy Shopper sales account for 20 per cent of its overall store sales and over half of them are new customers. The basket spend is really good and Snappy Shopper also gave him a lot of support with the launch with Facebook ads and leaflet drops.
It was reported recently that Snappy Shopper’s partnership with Nisa has delivered £12m in sales since they joined forces in 2020. With a total of 77 Nisa stores across the UK, the number of orders hit nearly 500,000, with an average order value of £26.70.
So far, Snappy Shopper has been focused on the UK convenience sector but plans to expand to other high street retailers.
The business is now planning to capitalise on the slowdown of the dark store operating model and capture consumer demand by enabling existing local shops to offer a quick e-commerce service.
24houralcohol is another innovation that maps all the stores, supermarkets as well as independent stores on a map, and allows shoppers to place order from any through third party services like GoPuff and Beelivery.
These are simply some excellent examples of how e-commerce can work in partnership with local retailers to the benefit of customers- a complete win-win solution for everyone.
Going for it
Q-commerce and food aggregator partnerships are also hot. It allows grocery delivery firms and food aggregators to receive some of the benefits of a merger without actually having to go through a merger, almost like they are dating to test whether a closer long-term relationship can help them reach profitability.
Back in 2020 when instant delivery apps were in boom, concerns were also raised overgrowing number of dark stores, saying they would drain life from the public spaces and eventually create a society of homebound consumers. However, seeing the debacle of instant grocery delivery apps within three years, that forecast seemed to be too far-fetched and a borderline exaggeration.
Brick-and-mortar stores are here to stay for a long time to come though it is always wise to up the game with changing times to give the add-on services to those who desire.
Since consumers are now open and warmed up to this idea of ordering groceries at home, it is need of the hour that indie stores too take the trust that they have earned over decades to the online world and capture their fair share in instant delivery.
Sugro UK, the member-owned buying and marketing group, once again hosted its annual overseas Business Convention. This year it was held in numerous locations throughout India.
This highly successful event marked another milestone for the Group, delivering substantial incremental growth with almost 10 million cases purchased during a three-month incentive period, benefiting both Members and Supply Partners alike.
The convention brought together over 80 Members and Suppliers for a mix of formal and informal oneto-one business sessions, fostering strong networking opportunities and bolstering the marketplace. Feedback from attendees highlighted the exceptional value of face-to-face interaction, emphasising how these events continue to strengthen the Sugro ‘Family’ dynamic.
Beyond business discussions, Sugro UK extended its impact through a meaningful charitable initiative tied to the location of this year’s convention. As part of its commitment to giving back to the communities hosting their events, Sugro UK, alongside Supply Partners—Red Bull, Suntory Beverages, Britvic and AG Barr—made a significant donation to support the CSR Project Jaisalmer.
The project will help renovate the Government Upper Primary School in Jaisalmer, which has been neglected by authorities for many years and lacks basic sanitary facilities. Established in 1964, the school serves 100 pupils, who urgently need improved conditions.
Sugro’s donation will directly support the renovation of sanitation facilities for both boys and girls, ensuring a healthier and more dignified learning environment for the children. This project will make a massive different for all pupils, but for the girls, in particular, whose school attendance rates significantly drops due to period poverty (According to Dasra, 23 million girls drop out of school every year in India due to a lack of menstrual hygiene management facilities in schools).
Emma Senior, Managing Director at Sugro UK, commented, “This was a record year of attendees for the Sugro Convention and the feedback from members and suppliers alike has been incredible. It was fantastic to see so many new faces, with some suppliers attending for the first time.
My personal highlight was cutting the ribbon on the toilets in the Jaisalmer school. We had a resounding welcome from the children, their teachers and the leaders from the town. Their appreciation was certainly felt by all of us.”
Yulia Petitt, Head of Commercial & Marketing added: “Sugro has had 18 consecutive years of growth and continue with its strong performance in 2024 with the year-to-date growth of +15% compared with the same period in 2023. With some excellent business opportunities being discussed between Members and Suppliers during the convention trip, there is no doubt that the Group will continue with its remarkable performance this year.
"As always, the convention trip was delivered with very high standards and some fantastic feedback from our Members and Suppliers. It was great to see how the event once again brought the Sugro ‘Family’ together, this time in the incredible setting of India.”
Looking ahead, Sugro UK is committed to hosting more successful events both locally and internationally. With its continued focus on business excellence and charitable initiatives, Sugro will keep supporting its Members and Supply Partners while driving growth, innovation, and community impact in the wholesale sector.
An exciting new rewards initiative launched by Allwyn – called “Share the Win” – is transforming National Lottery retailers into winners, simply by them selling a high value winning ticket or Scratchcard.
The new ‘Share the Win’ initiative is putting a range of prizes up for grabs for National Lottery retailers who sell high tier (£50,000 or more) winning draw-based games tickets – such as EuroMillions, Lotto, and Thunderball – or National Lottery Scratchcards. The scheme is open to all retailers where the winning ticketholder is happy to share details of their win.
The amount awarded to the National Lottery retailer will be linked to the size of the player’s win and celebrated with new in-store activation kit – including a special “Big Winner Made Here” poster and wall plaque, and for gold tier winners, a gold "Millionaire Made Here" Playstation.
There are three tiers of prizes available to retailers through the new initiative:
Gold tier - wins of more than £1m will net lucky retailers the top prize of £10,000
Silver tier - wins between £251,000 and £1m will be worth £5,000 to shop owners
Bronze tier - wins between £50,000 and £250,000 will see retailers pocket £2,000
The first winner to net a fantastic Share the Win prize has been unveiled as Drummond Miller, owner of Keystore in Dalkeith, Scotland, who has scooped the £5,000 silver tier prize for selling a winning National Lottery Thunderball ticket worth £500,000 to Raymond Young.
“Huge congratulations to Drummond for becoming our first ever Share the Win winner,” said Allwyn's Interim Retail Director, James Dunbar. “With this initiative, we are multiplying the joy of winning on The National Lottery by taking a player’s magnificent win and then rewarding the retailer who sold them their winning ticket. It adds a whole new dimension to selling National Lottery tickets for our retail partners, because simply selling a single lucky ticket could land them an incredible prize themselves. They’ll be able to then share in the amazing feeling of winning on The National Lottery!
“And this initiative not only rewards retailers for helping us to make huge National Lottery winners, but also for helping us to raise around £30 million each and every week for National Lottery-funded projects.”
Drummond Miller said: "Just as Christmas approaches, it is fantastic to find out that I’m the first retailer in the UK to win this amazing initiative. The £5,000 prize will bring some extra gold to the staff Christmas bonuses and early festive cheer to the shop, this year. The National Lottery has always driven extra traffic to Keystore, so this is more wonderful news for us and for all my potential future winners."
Raymond Young, who bought his winning National Lottery Thunderball ticket in Keystore (known locally as Fordel Services), said: “I’m chuffed to bits to see my local store win because of my luck. It was great to win and hopefully the lucky store can spread a little of my fortune through the local community.”
National Lottery retailers can head to the National Lottery Retailer Hub to ensure they're opted in to receive email communications, so they don't miss out on this exciting opportunity.
The government has on Friday published a policy update on recycling, introducing significant changes for businesses to streamline recycling practices and improve sustainability. Effective by 31 March 2025, these reforms set new standards for waste collection across England, aiming to create a consistent system that benefits the environment and reduces confusion.
Businesses and non-domestic premises, including schools and hospitals, must arrange for the collection of the following recyclable waste streams:
Glass such as drinks bottles and rinsed empty food jars
Metal such as drinks cans and food tins, empty aerosols, aluminium foil, aluminium food trays and tubes
Plastic such as rinsed empty food containers and bottles
Paper such as old newspapers and envelopes
Cardboard such as delivery boxes and packaging
Food leftovers or waste generated by food preparation
Businesses with fewer than 10 full-time equivalent employees (micro-firms) are exempt from these requirements until 31 March 2027.
Environmental charity WRAP has published a guide for the retail and wholesale sector, available here, to help implement recycling in the workplace.
Claire Shrewsbury, director of insights and innovation at WRAP, termed the incoming requirements on business recycling as a “hugely important step.”
“There are enormous environmental and financial gains to be realised by encouraging the 2.2 million business in England to separate food and recyclables from refuse. The two-year delay for micro-sized businesses will give smaller businesses more time to implement recycling into smaller or shared premises,” Shrewsbury said.
“WRAP is working with Defra and industry to develop new support tools and guidance to help all businesses with the transition. We will continue to work with trade bodies and local authorities to make transition as seamless as possible through our tools, technical support, and resources,” she added.
Footfall took a "disappointing tumble" in November, shows recent industry data, as retailers remain hopeful that the Black Friday and Christmas sales will help to turn things around for good.
According to BRC-Sensormatic data, total UK footfall decreased by 4.5 per cent in November (YoY), down from -1.1per cent in October. High Street footfall decreased by 3.7 per cent in November (YoY), down from -3.6 per cent in October.
Retail Park footfall decreased by 1.1 per cent in November (YoY), down from +4.8 per cent in October. Shopping Centre footfall decreased by 6.1 per cent in November (YoY), down from -1.6 per cent in October.
Footfall decreased year-on-year for all four nations, with Northern Ireland falling by 2.8 per cent, England by 4.2 per cent, Scotland by 6.8 per cent, while Wales experienced the biggest decline at 7.1 per cent.
Helen Dickinson, Chief Executive of the British Retail Consortium, said, "Footfall took a disappointing tumble in November, as a later-than-usual Black Friday and low consumer confidence meant customers were hesitant to hit the shops. Some northern cities also suffered particularly badly due to Storm Bert, which caused travel disruption towards the end of the month.
"Retailers remain hopeful that the Black Friday and Christmas sales will help to turn around the declining footfall seen through most of 2024, crucial as we enter the “golden quarter”.
"Retail not only contributes to the economy of local areas but is essential to everyday life in communities across the country. New costs bearing down on retailers in 2025, including from rises in Employer National Insurance, National Living Wage, and packaging taxes, means investment in jobs, stores, and high streets will likely be curtailed.
"If the Government wishes to bolster footfall and the growth and investment that would come with it, it must help retailers mitigate the impact of the £7 billion additional costs they face from next year.”
Andy Sumpter, Retail Consultant EMEA for Sensormatic, commented, "Retail store visits dipped in November as consumer confidence remains volatile, perhaps not helped by post-Budget spending jitters and shoppers withholding festive purchases, opting instead to shop around for the best prices or hold out for further discounting.
"This lacklustre footfall performance will have come as a blow for many retailers, who would have been counting on getting early Christmas trading results under their belts before the start of advent.
"However, it’s worth noting that these figures do not include Black Friday and the Saturday of the Black Friday weekend - tipped as one of the top busiest days for store shopping during peak trading - which will hopefully jump start seasonal shopping. Now, all eyes turn to December, where retailers hope to make up for lost ground and turn around their festive fortunes.
"This will rely not only on effective merchandising and shored up inventory availability, but on building the compelling and immersive experiences that bring the seasonal magic to life in-store.”
More than nine in 10 independent retailers have said that the government’s proposed generational smoking ban and a ban on disposable vapes will fuel demand for illicit products even further, a survey of members of the Federation of Independent Retailers (the Fed) has shown.
Seventy-eight per cent of respondents said more of their customers than ever were buying illicit tobacco and vapes from other sources and just over half (55 per cent) were aware of specific places near their shops where illegal products were on sale.
However, only 33 per cent said they had reported people peddling illicit tobacco to the authorities, with two thirds (67 per cent) said they had not. Nearly eight in 10 (77 per cent) said Trading Standards were not doing enough to tackle the problem in their area.
Nearly 400 retailers participated in the survey, which ran over 10 days during November, to help the Fed to better understand the impact that sales of illicit tobacco have on members’ stores and how the introduction of the generational smoking ban, which bans the sale of tobacco products across the UK to anyone aged 15 or younger, will fuel this black market.
Commenting on the results, the Fed’s National President Mo Razzaq said, “The government’s plan to stop young people smoking and vaping may look good on paper and in headlines but as our survey shows it will have serious impacts on legitimate traders.
“Just like shoplifting, selling counterfeit and non-duty tobacco is not a victimless crime. It damages legitimate retail businesses and communities. The people who peddle illegal tobacco couldn’t care less whether the customer is 18 or over. They just want the profit.”
Fed National President Mo Razzaq
Fed National President Mo Razzaq
Razzaq continued, “To make matters worse, the illicit tobacco market is often linked to organised crime, with the profits used to fund the smuggling of weapons, drugs – and even people.
“Making it an offence for anyone born on or after January 1, 2009, to be sold tobacco and banning the sale of single use vapes in legitimate retail outlets will mean the governments of the four nations are simply handing a blank cheque to rogue dealers on social media, street corners and by school gates.
"The legislation will impact on visible traders rather than the less visible ones who trade on a larger scale.”
The Fed released the findings of its survey in the week that the Tobacco and Vaping Bill returned to parliament for its second reading.