Supermarket chain Jumbo is going to collaborate with flash delivery company Gorillas. Jumbo supplies a large part of its range to Gorillas, such as the private label and La Place products. In addition, online Jumbo customers who live in cities will soon have the option of having their purchases delivered by Gorillas within ten minutes.
The German Gorillas has been active on the Dutch market since last year and now delivers groceries in eleven cities. Abroad, the company has previously entered into strategic agreements with supermarket chains, such as Tesco in England and Casino Group in France. Jumbo is the first Dutch supermarket to join the relatively new phenomenon of flash delivery.
The partnership will start this quarter and will be scaled up quickly, according to both parties. The deal is not limited to our country, Jumbo and Gorillas are also seeking rapprochement in Flanders. The two companies also want to bundle their marketing activities in the field of lightning-fast delivery and see opportunities for joint locations. The parties will not disclose financial details of the partnership.
It is unlikely that residents outside the major cities will be able to take advantage of flash delivery, as the promise of delivering groceries to customers within ten minutes can only be fulfilled in areas where many people live in close proximity to each other. Gorillas has several mini-warehouses in cities (so-called dark stores) that supply the bicycle couriers. In addition to Gorillas, two other players are active in flash delivery in the Netherlands: the German Flink and the Turkish Getir. The rapid rise of these companies is also a source of criticism: residents in cities such as Amsterdam and Rotterdam complain about the many dark stores in residential areas and unsafe traffic situations caused by some bicycle couriers.
Sharp
That does not stop Jumbo from embracing the new phenomenon. According to Jumbo boss Frits van Eerd, a company like Gorillas keeps things sharp. “We notice that online customers in the major cities need flash delivery. The wishes of the customer are central to us and that is why we move with changes in the market. The collaboration allows us to expand the options available to our customers.”
In addition to the deal with Gorillas, the Veghel company is also announcing its turnover figures for 2021 today. Jumbo’s sales increased slightly last year. The supermarket chain managed to increase its market share to more than 22 percent and also sold more groceries via the internet. Nevertheless, the turnover figure lagged somewhat behind the expectations that Jumbo had previously expressed.
The company booked a turnover of 9.9 billion euros in 2021, while Jumbo expected a turnover of at least 10 billion euros. Revenues increased by 2 percent compared to 2020. Jumbo opened eighteen new branches last year, nine of which in Belgium.
Supermarkets are taking advantage of the corona crisis. Due to lockdown measures to prevent the spread of the virus, consumers cannot spend their money in the catering industry, for example. For example, never before have the Dutch spent so much money at the supermarket in the week before Christmas.
La Place
The results of La Place, also part of Jumbo, were disappointing. The restaurant chain was partially or completely closed for much of the past period due to lockdown measures. La Place’s turnover increased by 4 percent to 52 million euros. In 2020, restaurants were also closed for much of the year.
Internet sales rose by 30 percent to 650 million euros. According to the company, substantial investments are still needed to keep up with market demand and to “work towards profitable business operations”, according to an explanation. Jumbo opened ten new delivery hubs last year, bringing the total to sixteen. In 2022, the chain wants to open another four.
According to Jumbo, the uncertainties in the market are greater than ever. Continuing scarcity of raw materials and transport capacity, increases in purchasing prices and a tight labor market are causing costs to rise. “Smart innovation and keeping costs in check, that’s what it’s all about in these challenging times,” says Frits van Eerd.
Jumbo celebrated its centenary last year. Jumbo’s roots go back to 1921 when Johan van Eerdt started a wholesale business in colonial goods in Veghel. In 1996 the first Jumbo supermarket was opened in Den Bosch. Since then, the company has grown strongly, partly through acquisitions.
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