A grocery bag with the logo of the American on-demand delivery start-up Gopuff.
As delivery start-ups vie for speed, Gopuff co-founder and co-CEO Yakir Gola said on Tuesday he has the power to outlast rivals.
He said the venture-backed company didn’t just want to get layers, snacks and more to customers’ doors fast. He said he also wants to deliver a better customer experience and build a profitable business that can expand across the world.
“I really believe we’re in a category of one,” he said at the Groceryshop conference in Las Vegas.
Gopuff is one of an increasingly crowded startup group that looks like an online version of convenience stores and grocery stores. Unlike other delivery companies, such as DoorDash and Instacart, GoPuff does not pick up merchandise from retail stores. Instead, it has its own network of micro-distribution centers (high-tech mini warehouses) full of inventory. Contract workers pick up orders and drop them off quickly at customers’ doors in around 30 minutes.
Some competitors, such as Gorillas, Getir, and Jokr, have entered new markets and promised even faster delivery times of 15 minutes or less.
Still, Gola said he was a category veteran. Gopuff coined a term for the group: “instant needs” businesses.
Gopuff was born in 2013 when Gola and his co-founder, Rafael Ilishayev, were students at Drexel University in Philadelphia and wanted a way to get late-night snacks like chips and candy without running to a convenience store. The company started delivering these goods, along with hookahs and tobacco products.
Today, it operates in more than 1,000 cities and offers more than 4,000 items, from pet food to over-the-counter medicines. Its valuation reached $ 15 billion in July. And it includes brick and mortar stores, which also serve as warehouses. It has acquired two regional alcoholic beverage chains: the Californian liquor chain BevMo! in December for $ 350 million and Kentucky Liquor Barn in June for an undisclosed amount.
He said Gopuff keeps shipping costs low and improves profitability by cutting out middlemen and making money selling products and advertisements. Its shipping cost is $ 1.95 per order, with up to $ 2 additional charges for orders that include alcohol.
“Once you have too many parties involved – the store, the driver, the delivery platform itself – you start to erode the margin and the customer experience isn’t flawless,” he said. he declares.
Gola said the company is adding 40 or 50 micro-execution centers every month and is branching out into new categories. During the pandemic, it added household items like cleaning supplies and home Covid-19 tests. It has also started delivering hot food, such as coffee, breakfast sandwiches and pizza, to some locations.
The average customer is still young, he said, in their late twenties or early thirties, but a declining percentage is made up of students. Its fastest growing category year over year has been baby products, he said.