Sidney Marie Chin analyses the recent partnership between Aldi and Deliveroo.
Aldi has partnered with Deliveroo to launch rapid home deliveries for the first time in the UK. This will be trialled in Nottingham, before expanding to seven other stores across the East Midlands in June. If successful, Aldi is likely to extend this service to more stores by the end of the year. The discount supermarket chain has previously offered online deliveries for a limited range of non-food items such as electrical goods. However, in April, it started selling online food parcels to aid those who were vulnerable and self-isolating during the lockdown. This new service allows customers to order from over 150 essential products through the Deliveroo app. These will be packed by Aldi’s in-store workers and couriered by Deliveroo’s riders ‘in as little as 30 minutes’. Deliveroo has also forged similar partnerships with Marks & Spencer and Morrisons to cope with the increased demand.
Since the health crisis, many supermarkets now have to adapt to the new normal. Demand for online grocery services have risen sharply as customers self-isolate and work from home. Britain’s biggest supermarket chains – Tesco, Sainsbury’s, Waitrose and Morrisons have been ramping-up their online delivery slots but are still struggling to keep up with the increased demand because they do not have enough vans and in-house staff. Online grocery sales have grown over 10% in the past three months and with social distancing likely to last until the end of the year, the online grocery market is forecasted to grow by a total of 25%, rather than the 8% initially anticipated.
As one of the UK’s biggest supermarkets, Aldi’s trial with Deliveroo gives them a distinct advantage over their competitors. By striking a partnership with Deliveroo, it does not need to develop its own delivery network as other supermarkets like Sainsbury and Tesco have been forced to do. Instead, by leveraging Deliveroo’s existing and established infrastructure, it saves money by not having to hire additional vans and build ‘dark stores’ for home deliveries. As Paul Kirkland, Director of Retail and Hospitality, Fujitsu UK&I aptly notes, ‘Aldi’s combination of in-store pick up and local delivery drivers may very well be the recipe for success’.
By Sidney Marie Chin.