Melbourne-based food delivery startup YourGrocer is calling on its user base to help spread the word as it expands delivery to all Melbourne suburbs.
YourGrocer enables users to support local businesses like butchers, greengrocers and bakers, and is currently capturing 15% of the online grocery market in inner-north Melbourne postcodes with $4.5 million in groceries on the platform, according to co-founder Morgan Ranieri.
In December last year the startup raised $1.3 million in a round led by Tank Stream Ventures, with Giant Leap, Envato founders Cyan and Collis Ta’eed, and Menulog investor Michael Doubinski also contributing.
“Asking for help is always humbling,” co-founder Morgan Ranieri wrote in a company blog post this week, asking for a “shout out” from users on social media to help the startup “give Coles and Woolies a real shake up”.
Ranieri says he’s “surprised by how much its taken off” since the post was published on the weekend, with the post amassing more 160 shares and almost 300 likes.
He admits that he was initially hesitant to ask for help, believing instead that YourGrocer could “make it by ourselves”.
“It feels like a bit of a hit in your pride or ego to ask people for help,” he tells StartupSmart.
“The reality is people want to help — the most successful people have got help along the way.”
Ranieri’s grassroots approach was fostered while co-founding Thankyou water, which has gone on to become one of Australia’s most well known social enterprises, the Thankyou Group, with over $5.5 million donated to charities as of February 2017.
“This grassroots people power movement is really what built Thankyou — people believing in something and wanting to do their bit to make the world a bit better,” Ranieri says.
YourGrocer capitalises on the shop local movement, coupling the convenience of home delivery with the ethical ethos of supporting local producers and food providers.
“A lot of people in Australia see the damaging impacts the supermarkets have on the whole grocery and fresh fruit ecosystem and want to do something about it, but its really hard: ordering your groceries online [via YourGrocer] from the local butcher is one way to do it” Ranieri says.
He notes that while coordinating city-wide delivery is “very logistically challenging” and online grocery is “in its early days”, cracking into the grocery market — Australia’s largest retail category — is a “hard but solvable” challenge.
Tips for expansion
Ranieri believes being able to balance customers, products, your team and funding is crucial for startup founders expanding their offerings.
“If any of those four things gets too far ahead of the others then you can fall over,” he says.
YourGrocer conducted months of trials before announcing city-wide delivery to avoid a “false start” in new markets, Ranieri says.
“Do it carefully, test and experiment but don’t assume [your product] will work with customers in new geographies and new customer types,” he says.
With YourGrocer rolling out across Melbourne, Ranieri believes it’s “not hard to imagine” the startup taking 15% of the online grocery market in Melbourne in the near future, with ambitions to eventually take 15% of the grocery market in Australia and beyond.
“I think our product is not just one that resonates with Melburnians … It’s human nature to want to get better value for money produce and to want to support independents” he says.
“Customers are satisfied with the convenience Coles and Woolies bring but dissatisfied by the quality and price — their profit margins are three times higher than the international average for supermarkets,” he says.
“Australians aren’t getting a good deal but that’s going to change.”