Online meal delivery services enable customers to order
essentials and get them delivered to their place at their convenience. The
industry has proliferated due to the COVID-19 spread. Top players provide a
platform that customers can use to order the needed thing with a few clicks.
One such on-demand ordering and delivery platform is GoPuff. The
go-to delivery service provides solutions for everyday requirements. GoPuff
offers delivery for food, grocery, drinks, and other day-to-day essentials; the
company tries to satisfy all the customers' needs. The delivery platform
operation is based on an inventory business model.
Recently Gopuff announced that it is working with Goldman
Sachs Group Inc for an initial public offering. The delivery platform has taken
a step to go public with a $1.5 billion pre-IPO. The convertible note will
convert to boost the company's valuation to $40 billion. GoPuff sets a great
example of how small delivery business investment can provide significant
payoffs and have huge lasting equity for the company.
What is Gopuff?
Headquartered in Philadelphia, Pennsylvania, the delivery
platform, Gopuff was
founded in 2013. The food and consumer goods delivery platform was founded by
Yakir Gola and Rafael Ilishayev. As of October 2021, Gopuff operates in more
than 650 US cities through 500 micro fulfillment centers; the company also
operates in a handful of cities of the UK, following the 2021 takeover of
'Fancy.' The company was valued at $ 15 billion as of July 2021.
GoPuff is the go-to solution and fulfills customers' orders of
home products and cleaning, food and drinks, medications, and more. The
delivery platform delivers almost everything to customers' doorsteps for a
$1.95 delivery charge. With the motto to provide "what they need and when
they need," Gopuff offers around-the-clock service to its customers.
GoPuff Success Story and Funding
History
The Philadelphia-based company, Gopuff delivers everything on
customers' whim; the company has earned around $615.9
million in the last few years. A convenience store delivery service,
Gopuff has started its service to Homewood. It makes it easier for customers to
order from more than 3,000 products in categories.
The go-to platform which offers immediate delivery service to
customers has announced the launch Basically. The launch has helped the company
expand to Private
label, Basically provides customers access to home essentials,
snacks, and home essentials as well.
The immediate delivery service provides about 2,00,000
free at-home tests to consumers nationwide through 15 Feb 2022. Gopuff raised
around 3.4
billion dollars in funding in 2015. The
funding round Series G and H together has raised 2.2 billion, showing a rapid
growth in 2021.
The delivery company confirms around $1
billion cash injection at a $15 billion valuation to boost its
instant grocery delivery service. For some funding context, Gopuff raised
around $1.15 billion, which increased the company's valuation to $8.9
billion. Instant Gopuff's grocery model comes from funding in the space
of 10 months.
Looking at the growing usage and popularity of delivery anything app, most
delivery brands choose to build an app similar to Gopuff. The easy-to-use
solution helps them manage various business activities and complete more orders
speedily and efficiently than ever before.
Gopuff Business Model: Everything
You Want to Know!
"Order anything in seconds and get everything delivered in
minutes."
Unlike other delivery players, Gopuff also provided instant
access to customers to get everything delivered within a few minutes. Gopuff
business model is based on an integrated model which helps the company to
deliver instant pickup and delivery service to end-users. The platform makes it easier for customers to
order drinks, food, and other essentials in a few seconds.
Customers do not have to pay any surge price for the service.
Let's have a look over the customer segment, resources, and value proposition
of Gopuff right here.
Customer Segments
Customers
·
People who don't have enough time to purchase groceries and food
for their daily use
·
Customers who want to enjoy doorstep deliveries
Warehouses
·
Those entrepreneurs who want to expand their reach
·
Those who wish to provide online service
Value Proposition of Gopuff
The all-in-one platform, GoPuff, adds value to customers, local
stores, and delivery providers. Learn how all the parties leverage the use of
the delivery platform.
Value for Customers
·
The convenience of ordering essentials from anywhere and at any
time
·
Save time and efforts
·
Provide a wide range of options
Value for Partners
·
Brand awareness by listing products
·
Expand business reach
Value for a Delivery Provider
·
Great earning opportunities
How Does Gopuff Work?
Gopuff is an online food and grocery delivery service operating
in hundreds of cities across the US. Once a customer enters the delivery
location, users are directed to the inventory and selection available from the
local Gopuff warehouses. Consumers can easily add items to the cart as well as
pay online, much like a traditional digital order platform.
Once customers place the order, the partner store or merchants
get notified. They pick the ordered item from the warehouse shelves and bag
them. Bags are then held to every driver, often grouping multiple delivered to
location close proximity when possible.
The delivery provider then collects the bags and delivers them
to the customer's location. An app similar to Gopuff makes it easier for
customers to get anything delivered within 15 to 30 minutes.
How Gopuff Makes Money: Revenue
Model Explained
Gopuff revenue model is four revenue streams that help them make
money. Let us take a look at each money-making method of Gopuff to know how the
delivery giant makes money?
Markup
Marking up products is the very first method of Gopuff to
generate money. However, most online meal and grocery delivery apps complete
the orders by delivering products from a restaurant or supermarket.
The delivery company purchases the products and stores them in
its warehouses. When a customer places an order, the products are sold by the
company, and the difference between buying plus and selling price is the profit
earned by the delivery provider.
Delivery Fees
Gopuff charges delivery fees and take-home profit for the
company. Gopuff charges around $1.95 for each order and an additional $2 for
alcohol delivery. However, the delivery fee is more when the order is more than
$49, and the company generates adequate profit to cover the delivery cost.
Membership
The delivery platform offers a membership program, Gopuff Farm,
for customers. The company charges around $5.95 per month; this is the primary
revenue stream. Gopuff motivates its customers to subscribe to the membership
program by providing benefits like free delivery, discounts, and more.
Advertising
Being placed in the product category can be extremely valuable
for a brand with a large number of customers every month. Gopuff uses
opportunities as a revenue stream by selling priority placements on online
delivery platforms. Gopuff generates around $600,000 by emphasis placement of
Nightfood.
How is Gopuff Different &
Revolutionary?
Gopuff is a unique service provider that stands out in the
market. It is a one-stop shopping platform for end-users. The supply chain
aspects that contribute to this are:
Personally Owned Warehouses
Gopuff owns a warehouse to deliver services instead of acting as
a service that picks up items from partner businesses. Orders directly from the
warehouse can help to cut down the logistics involved.
Upfront Inventory
Gopuff owns a physical distribution center; it purchases product
inventory in prevalence at wholesale price from suppliers. It helps to keep
prices low and eliminates the requirement for delivery fees. The predictive
algorithm of the company enables it to stay on top, reduce the risk, and the
need for substitute products.
Contract Drivers
The delivery giant does not need to hire third-party services or
middlemen to transport orders. The contract with delivery providers to act as
gig workers in free time. It saves delivery time and eliminates fuel costs.
Gopuff drivers tend to earn around $ 10 to 20 an hour.
The combo of all the above-listed factors results in quick
offering and convenience. You can even start providing the same service with an
app similar to Gopuff.
What's Next For Gopuff?
There are various ideas on which Gopuff can work to improve its
sales in upcoming years, these includes:
·
Adding depth and breadth to its operations in North America;
·
Expand service beyond North America;
·
Improve customers service and provide a unique shopping
experience;
·
Push the vertical integration with Gopuff labeled products.
You can choose to develop a unique grocery delivery app similar
to Gopuff; all you need is to partner with the right tech partner. Have a look
at our White Label Fox website
to know how we can help you with the development.
Ending Note
On-demand meal and grocery delivery app, Gopuff is improving
its service and expanding to hundreds of cities in the US and UK. The
inventory-based Gopuff business model and revenue model helps entrepreneurs
launch an app similar to it. Let's connect to solve all your queries about
cost, features, and more at sales@whitelabelfox.com.
