In the last week, almost two billion dollars were invested in last-mile startups. Among the most remarkable: Shippo got $1B. Germany’s Flink $240M. Turkish Getir $550M.
A definition you will hear quite often, associated with big rounds, is ultra-fast grocery delivery. That’s the latest rage, an apparently bottomless sinkhole in which a lot of money is being hurtled, hoping to bet on the winning horse.
Milkman Technologies launched a Linkedin survey: If you are interested in the last-mile sector, what kind of delivery service would you invest in?
These are the selected choices:
- Ultra-fast Grocery. Groceries that opt for delivery services in 30 minutes or less through gig-economy workers, picking at supermarkets or dedicated dark stores. This is a solution fast to set up but pricey, taking as much as 30% revenue off every order. Brand consistency, product availability and stock management also pose serious challenges.
- Ultra-fast Retailer. Retailers that opt for delivery services in 30 minutes or less through gig-economy workers, but delivering non-perishables and picking mostly from shops. This part of the market has been eyed upon by the likes of Doordash, Uber but it’s a tough nut to crack, as demand doesn’t seem to justify expenses.
- Time-definite Big & Bulky. Appliances and furniture take longer to deliver and often need to be installed. Customers have to be home to receive these and missing the delivery may result in some serious friction on their part.
- Time-definite Retailer. This option includes pure eCommerce and marketplaces but can be applied also to brick and mortar shops that decide to go omnichannel with an online presence.
The collected answers were quite interesting and show the following:
- Ultra-fast grocery 31%. This concept is getting a lot of attention, but its future is still to be written. Gig-economy impending regulation will make it hard for companies, especially in Europe, to harvest the benefits of this model. And the scenario works if only a few big players consolidate the market by incorporating the others.
- Ultra-fast Direct to Consumers 21%. The idea was fashionable a few years back but suffered from the failure of UberRush. Looks like it is still too expensive to serve those low volumes that remain the whim of a minimum percentage of customers.
- Time-definite Big & Bulky 13%. This got the vote of the most last-mile experts that recognize its enormous potential. This market worths $13B in the USA, growing faster than the parcel one and without leading players.
- Time-definite retailer 35%. This is the most selected choice of the survey winner and reflects the future of Amazon’s ideal delivery scenario. The future clearly belongs to customisation, freedom, precision, communication & real-time tracking visibility.
Milkman Home Delivery Platform offers time-definite deliveries for Retailers and Big & Bulky. What about time-definite deliveries for Grocers? Milkman Technologies supports those as well, as we are doing for EasyCoop, one of the sector’s most innovative operations.
Stay tuned for our next survey, which will be soon be published on Milkman’s LinkedIn page.
Written by: Adamo Dagradi, Content Manager