The competition in the business with the delivery of food and groceries in Germany is heating up rapidly. The Dax group Delivery Hero announced about two years after the sale of its German business that it would return to its home market. Lieferando, the clear market leader in food delivery, is expanding its business to include food delivery. This is the beginning of a rivalry in Germany between “super apps” that deliver ready-made food and supermarket goods from a single source. The corona pandemic gave delivery services a powerful boost.
Return from Delivery Hero
Delivery Hero had sold its German business with Lieferheld, Foodora and Pizza.de a good two years ago to the Dutch competitor Takeaway.com. These brands were then discontinued. The industry giant Just Eat Takeaway, formed in 2020, is currently dominating the German food delivery market with Lieferando. Delivery Hero relies on its Foodpanda brand for its return to Germany.
With Foodpanda, Delivery Hero has so far been strongly represented, especially in the Asian region. Japan was added to Singapore, Malaysia and Thailand in the autumn. After the start in Berlin, Foodpanda will then also offer services in other German cities.
When it comes to delivering supermarket items, Delivery Hero and Lieferando compete against young services like Gorillas and Flink, who promise deliveries within ten minutes with their bicycle couriers in several German cities.
Delivery time of seven minutes
Delivery Hero wants to undercut this value: Food and products should reach the customer in seven minutes. To ensure that this works, the company is setting up smaller warehouses in the city centers, so-called “Dmarts”. The group counted 600 such locations worldwide in the first three months of the year. In addition, the group is relying on the start of so-called cloud kitchens – restaurant kitchens that exclusively prepare dishes for deliveries. Delivery Hero announced that a test phase should start in Berlin as early as June.
In addition to the top dog Lieferando, Foodpanda has to adjust to competition in the restaurant segment in this country from the Finnish start-up Wolt, which is now active in Berlin, Frankfurt and Munich.
Lieferando announced that the food orders should be delivered within 20 to 30 minutes. There was initially no information on the schedule for expanding business in Germany. Lieferando merely pointed out that, with 10,000 couriers in around 50 German cities, they are well positioned to be successful as a “super app”. Before the end of this year, they want to expand their own logistics in Germany to 80 cities.
The head of Just Eat Takeaway, Jitse Groen, showed himself belligerent after Delivery Hero’s announcement that it would return to the German market. “We beat them in Holland, Great Britain, Poland, Ireland and Germany – and we are happy to do it again”, he wrote on Twitter. In the last attempt, Delivery Hero took eight years, the takeover of the then number one and investments of 500 million euros to achieve a quarter of the size of Lieferando today, he scoffed.
The boss of Delivery Hero, Niklas Östberg, did not want to leave it that way. He countered via tweetthat they were the market leader in the sale of the German business to Groen’s company. In addition, Lieferando was also an acquisition.
On Wednesday, Uber also announced the start of its food delivery service Eats in Germany. To begin with, the delivery area is limited to the center of Berlin, with more than 200 restaurants participating. The expansion is being worked on, said Uber. In the corona pandemic, food deliveries became a much more important business area for the company, while there were slumps in driving services. At the start in Berlin, around 500 couriers are deployed, mostly with bicycles and e-bikes. They are employed by local delivery companies that Uber works with.