The next paradigm for ultra-fast grocery delivery is more choice – without decimating brick-and-mortar stores, Uber’s grocery boss says

Anderson is Uber’s global head of grocery and retail. — Getty Images/Fortune/The New York Times

It feels like ancient history when groceries were only purchased at physical stores.

Over the years, as the number of apps bringing eggs and apples to your doorstep has proliferated, the waiting time for delivery has shrunk from days to a few hours (if not minutes).

It’s prompted a wave of new players, like Gopuff, which specialises in rapid grocery deliveries, making basic food and household items accessible with the tap of a finger.

But with wait times lower than ever, what more could grocery services do to up their game? Not necessarily faster delivery, but more variety and flexibility, says Susan Anderson, Uber’s global head of grocery and retail.

“We're seeing that customers ... don't necessarily need things in 10 minutes. Within that 30 minutes to an hour is really what customers are looking for,” Anderson told Fortune in an interview on Tuesday. “But it's the range of what they can get in that space – it's going to increasingly matter and that, people will start pushing the dimensions on.”

Uber Eats, the food delivery platform under ride-share giant Uber, began offering groceries in 2020, during the pandemic when people were confined to their homes. The grocery and retail business now spans 33 markets and is worth over US$7 billion as of the fourth quarter of 2023.

The company has tried to tap into the growth with new partnerships, like one with Instacart in the US, and by making the delivery process more seamless.

While Uber Eats and other delivery apps have increased access to everyday necessities, people still want brick-and-mortar stores. Apps have changed how people shop, for example, when you realise you need olive oil to make your pasta and place a quick grocery order. Still, Anderson said people aren’t turning their backs on local grocery stores.

Deliveroo offers similar services to Uber Eats by partnering with local stores such as Sainsbury’s and Waitrose to fulfill grocery orders. Deliveroo entered the market in 2018 and now has a grocery business worth an estimated £1bil (US$1.27bil), according to Grocery Gazette.

The demand for grocery delivery is set to grow in the coming years – in the U.K. alone, the number of people placing such orders has doubled in two years. Uber Eats is preparing for the next paradigm by making it more efficient for drivers to execute the orders they’ve been assigned.

The company unveiled a slew of new features on its platform Tuesday, such as aisle indexing that helps couriers find the exact placement of products on the customer’s order to expedite the shopping process. Uber Eats will also help couriers shop for their customers at stores and allow couriers to verify if the products they pick up match the orders.

All these features on Uber Eats aim to give customers flexibility on how, when, and where they shop for their daily necessities.

“Over the next few years, what we're going to see is that within local stores – whether that is worth in the supermarkets and their branches – we’ll see the ranges evolve so that people can get a broader range of things available in that really fast time ... increasingly being delivered from the high street or from the local stores,” Uber’s Anderson said. – New York Times

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