Everybody’s talking about Home Deliveries so in this article we discuss whether it’s here for the long term, if it’s good for your food businesses and how Foodlogik can help with that strategy.
During the pandemic, the initial response of many bakers to government issued guidelines was to shut their shops! However, most shops were then re-opened just as quickly once it was obvious that demand had not gone away, and bakery was an essential trade.
Bakery organisations soon devised methods to operate profitably, with reduced staff whilst adhering to social distancing rules and Covid-safe practices in the shop and the bakery.
For many food businesses, strategies involved streamlining or a temporary reduction of the product range, with a “back to basics” approach, which helped in reducing unit costs. Shops and outlets located on housing estates have, not surprisingly, been especially busy with many reporting much increased turnover. Daily staples such as loaves and rolls have enjoyed increased demand several times over. Likewise, bakers with exposure to large retailers such as Tesco, Asda, Scotmid and many others found much of the slack taken up with vastly increased volumes for basic products.
At the end of 2020, research company Mintel predicted the UK bread market was on track for 3.5% value growth and the highest volume sales since 2015. These figures were revealed at a webinar called ‘The impact of Covid-19 on bread and baked goods’, which was hosted by the British Society of Baking (BSB). Value sales for 2020 were estimated to reach £3.5bn – an increase of 3.5% from 2019 and 4.5% from 2018. This was predominantly driven by the market’s biggest segment, pre-packed bread, which was set to grow 6% in value year on year to £1.8bn. Speciality bread and rolls, meanwhile, were anticipating double digit growth of 11% to £1.1bn.
However, for many bakers the reduced footfall made a big impact on retail sales so home delivery or “cash and collect” was used to replace some of the lost revenue.
During the pandemic on-line shopping generally has accelerated even more and even if the peak has fallen back, as reported by some bakers, it is here to stay and in a big way. Customers, especially the elderly, have been driven by necessity to adopt the use of computer devices to make online purchases and schedule home deliveries. Further evidence to support this can be found in the press, such as The Guardian reports Ocado’s future expansion plans including a £1bn investment. The general industry consensus is that most of the shift on-line is permanent and won’t go away as shops gradually re-open.
Online ordering is now commonplace and home delivery is an expectation, be it grocery, clothing, garden plants or pizzas – why should local bakers be any different? So, the questions are can it be profitable and can you afford not to do it?
Anecdotal evidence and market surveys suggest that people are prepared to pay a premium for home deliveries, at least for the moment. Combined with the potential increased efficiencies in ordering and despatch, definitely means this can be a profitable option.
So, at Foodlogik we have been listening to these market trends and in response we have added several new features to our Home Delivery Module, as follows:
Set-price “Home Delivery Pack” e.g. Bakers Box, Variety Pack, Christmas Hampers, Buffet Platters or a Mixed Vegetable Box.
Pack content customisable per order.
Family pack – allows you to “upsell” by charging for extras over and above the set pack.
Works perfectly for buffets, where customers pay for extras such as drinks, cutlery condiments etc.
Orders can be set as delivered or collect.
Packing lists and invoice/delivery notes show the contents, with one price per pack.
Round Packing Lists and Customer Array reports show the home address and contact details for temporary or “cash” customers.
Integration with bakery websites, Shopify and social networking software using our EDI module.
Foodlogik continues to incorporate even more home-delivery features as standard as the popularity and necessity of home deliveries continues. We expect to see increasing product ranges as competition among bakers and grocers increases.
Feedback from our users and the marketplace is what drives us along so let us know what you think and what else we can do to make your Home Delivery business a good experience for you and your customers.
For more information on Foodlogik, contact us.