Grocemania. On Demand Grocery Delivery Expansion.
Grocery delivery is not a new concept. The big supermarkets have all been doing it for years, and they've gotten pretty good at it. Supermarket delivery vehicles are nearly as numerous as parcel delivery vans, delivering billions of pounds worth of shopping every year. So we were surprised to learn about Grocemania, a startup offering grocery delivery to customer's homes. Grocemania are different though. They are filling the niche between popping to the shops yourself and organising a large order to come from the supermarket. Their website advertises a minimum order of only £10, with a delivery charge of just £2.50! And they can deliver within an hour! So it's ideal if you just need a few emergency supplies and can't get to the shops.
Grocemania have had a great reception so far. Their feedback on social media is very positive and they've already been successful in raising £70,000 on Seedrs (a crowdfunding platform). They are about to embark on another round of crowdfunding to facilitate expansion outside of London.
We were lucky enough to get the opportunity to speak to Askar Bulegenov, founder of Grocemania, about their journey so far and their plans for the future.
Can you tell us about Grocemania? When did you start it? Where did the idea come from?
I came up with an idea in 2016 when I was a final year student at Kingston University. I also had a placement as a Financial Analyst and one day I got so tired after work and university that I asked some of my friends to bring me strawberries and chocolates. Unfortunately, all of them have forgotten and I thought why can't I just order from a local store, pay a little bit, and get it delivered on-demand. Inspired by Deliveroo's success at the time, we decided to launch a pilot and found a few local shops in Kingston, and created a website. Straightaway, we started receiving some great traction. This is how Grocemania started.
How has the business grown since you launched?
Some of our major milestones have been:
- Pitched to Mars Group to start a pilot on working with data to understand customer behaviour, who are purchasing Mars products on-demand.
- Delivered and fully automated our MVP to the market, web-app and IOS app.
- On-boarded over 60 shops across London and Brighton, covering 30 major postcode areas
- Over 3000 deliveries performed with an average order being £25.85
- Started our first corporate deliveries with "International Study Group" and now in advanced negotiations with a number of other well-known brands across London!
- Reached the first page of Google for keywords like "Grocery Delivery London", "Same-Day Grocery Delivery" and others.
- Won various awards and been highly commended at "World Post & Parcel Awards" as an On-Demand Delivery Business of the year.
- Been featured in various editions like The Grocer, Food Navigator, City AM, TNW, Better Retailing, Talking Retail and more!
- Pitched to Mars Group to start a pilot on working with data to understand customer behavior, who are purchasing Mars products on-demand.
- Announced our first conference for Independent Grocery Retail Owners, taking place in London on February 2020, where we will discuss current challenges, technologies, and trends with lots of different business owners, industry leaders, speakers, press and brands! Feel free to join us :)
And this is just the beginning of our journey!
What obstacles have you encountered so far? How did you overcome them?
The biggest challenge for any start-up is always to secure a funding. However, the biggest obstacle for me was to find a good technical partner. I once paid a big sum of money, but we never received the work promised. Now, it is my first official legal case and we have a hearing soon which also costs a good amount of money. So I would highly recommend to all new entrepreneurs to write down contracts, never make a full payment upfront and be very strict with their contractees when hiring for projects.
The grocery delivery industry is obviously very competitive. How have you achieved such rapid growth in a market dominated by huge companies like Tesco?
t doesn't feel like our growth is rapid! We just created some goals and then tried meet deadlines and fulfil each task to the best of our abilities. I've been lucky enough to meet some really nice entrepreneurs, journalists, and people who helped and are still helping us in various situations. But in general, we are always working towards our goals and testing different theories to get the best result.
You outsource your physical deliveries to Quiqup, can you tell us more about this collaboration and why you chose to outsource?
It's not Quiqup now actually, we've switched to working with Stuart (they charge a little less). As a start-up we are trying to stay lean, hiring an army of delivery personnel would not be cost-effective until we reach a big volume of orders. However, working with a partner delivery service helps us to build up our customer and partner (stores) base, and raise awareness until we reach that level and stay profitable simultaneously.
Your feedback is very positive and you have had lots of success at raising money on Seedrs. Can you tell us about how you've built such a supportive community around Grocemania?
Our community is comprised of everyone whom we met through different events, competitions, working spaces, or perhaps ordered from us. However, inviting and turning each one of them into an investor during your crowdfunding round is not a simple task. When we've been fundraising we've been posting on social media every day, emailed almost every day as well, producing blogs, highlighting it on our website, talking with journalists and much, much more. So we've been always trying to engage with our audience as much as we can, via all the channels that we have.
What does the future hold for Grocemania?
By December 2019, we plan to cover all 103 postcode areas across London and complete our expansion to Brighton. This will take us to 200 daily orders and a bit more than £20,000 monthly Net Profit. In the next 6-12 months, we plan to launch our own IOS (updated) and Android app with a new Partner Interface and start expanding to Birmingham and Bournemouth or Bristol. We're also going to start working with product data and product performance data in order to work with big brands like P&G, Unilever and Mars Group. By that time, we should already have a bit more than three hundred partners (stores) on the platform. In 3-5 years, I hope Grocemania will be the leading national grocery delivery service, covering all cities, while also serving the working data and advertisement industry.
What's been your favourite thing that's happened since you started Grocemania?
When we had our first 20 stores joining. It all became more serious and we started receiving a greater number of orders. It was very motivational for us all, and helps us to remember what is most important for our business.
If you could go back to when your first started your business, what piece of advice would you give yourself?
That is my dream. But if I could do it, I would tell myself to focus on generating profits and concentrate on everything related to that (i.e. the number of stories on the platform, and marketing budgets)
Growing a business can be very challenging, is there an entrepreneur that's helped inspire you to keep going?
Oh, I have a lot of role models. My father, Elon Musk, Jack Ma, and even some celebrities. I think it's important to be inspired by someone and surround yourself with the best people. However, the biggest role model for me is Elon Musk. He has achieved the impossible and is doing great things for humanity.
You've already had one successful Seedrs campaign, raising over £70,000 and are about to embark on your second campaign. What advice have you got for anyone thinking about a crowdfunding campaign? (You can read more about Grocemania's Seedrs campaign here: https://grocemania.co.uk/blogs/recipes/we-are-live-on-seedrs)
We've set a target of £90 000 for our second campaign and are planning to sign over 6.5% of the company in return. This will help us to fund further expansion to Brighton, Bournemouth, and Birmingham. We also want to improve our partner interface and develop our own ML and data analytics set in order to engage with bigger brands. We have already received one offer from Mars Group who is interested in purchasing data regarding Mars products being bought on demand. My biggest piece of advice would be to get everything ready in advance. Read what it takes to promote it, read all terms and conditions of the platform you are using and always remain persistent. Crowdfunding is tough but helps to increase awareness while raising capital.
12) Finally, can you tell us about a typical day at Grocemania HQ?
As in any startup, our days are hectic. My usual day would start with answering various emails, then having a scrum call with developers and speaking with my sales lead about the current performance. After lunch, I would usually have some Skype or phone calls, and work on my personal tasks. 5 pm and after would usually have a meeting with possible investors or interviews followed by some networking or pitching event. Sometimes, we could all go shop hunting (onboarding) for the entire day. For example, for the past two days, we've been shooting a promo video for our fundraising and also made some videos to attract new stores without even coming to the office at all. So, it all depends on our current set of tasks.