Covid-19: Grocery delivery partnerships reflect rapid consumer change, says analyst

Rapid changes in shopping habits are being reflected in high speed agreements being agreed between retailers and companies with home delivery capabilities, according to analyst GlobalData.

Morrisons recently announced that it has partnered with Deliveroo, to enable local deliveries from 130 of its supermarkets. The move is designed to allow families in isolation due to the Covid-19 pandemic, or those who are vulnerable, to benefit from speedy deliveries of online orders. Customers can choose from more than 70 essential Morrisons items – including meat, Quorn, and fruit – from the Deliveroo app.

Riders from the service leave the products outside the customer's door to ensure a contactless transaction, with prices kept the same as they are in-store.

GlobalData retail analyst Thomas Brereton said retailers have struggled in recent weeks to meet a surge in demand for home deliveries. As a result a number – including McColl's and M&S as well as Morrisons – have established a partnership with Deliveroo.

“Barring a few exceptions... most supermarkets do not have the operational capabilities to compete with Deliveroo's delivery time offer of c.30 minutes; and given the waiting times for traditional home delivery orders (currently two to three weeks at most grocers), the concept of a rapid delivery of essential products will be enticing for a heightened proportion of shoppers,” said Brereton.

However, Brereton cautioned retailers against entering into such relationships without clear boundaries. “As consumers are told not to panic buy, it is also important for retailers not to panic partner. There has been no indication about the length of these collaborations, so retailers must be wary of ceding too much power to third-party operatives – and could explain why major players – notably, Tesco and Sainsbury’s – are developing in-house alternatives instead,” he added.