After celebrating its centenary and narrowly missing out on a milestone turnover, Dutch supermarket chain Jumbo has turned its sights firmly on the future. A collaboration with express delivery company Gorillas should enable it to deliver groceries within a few minutes – and to expand online even faster.
No monkey business
Jumbo’s partnership with Gorillas is, on a basic level, enabling the supermarket chain to have groceries delivered instantly in larger towns and cities. The strategic cooperation will start in the Netherlands before the end of March, and in Belgium’s Dutch-speaking North a few months later. A large part of Jumbo’s product range, including A-brands, private label products and La Place products, will be delivered by Gorillas couriers within ten minutes.
On a deeper level, much more is possible: Jumbo has already hinted to investing in Gorillas’ capital and to joint projects regarding real estate, customer data and sports sponsorships and other forms of marketing. Benefits are mutual: while this is Gorillas’ breakthrough in the Dutch and Belgian market (after similar arrangements with Tesco in the United Kingdom and Casino in France), while Jumbo can reduce its fulfilment costs compared to doing the deliveries by itself.
Currently, Gorillas operates in eleven Dutch cities and two Belgian cities, and in twelve of these (all except Brussels) Jumbo will be Gorillas’ almost-exclusive supplier (with the exception of certain products supplied by local companies). The German company will also expand further in both these countries during this year. The partnership is meant to be a long-term ambition and will last several, “at least three”, years.
2022: 15 new stores in Belgium
At the same time, Jumbo has released its annual results for 2021, an “eventful year in many ways”, according to CEO Frits van Eerd. Online turnover of the supermarket chain increased by 30 % to 650 million euros, which is why Jumbo opened ten new delivery hubs in the Netherlands and its third e-fulfilment centre. In 2022, another four delivery hubs and a fourth ‘EFC’ will be added to ensure further (and faster) online growth.
Last year, total turnover in Jumbo’s centenary year rose 2 % to 9.9 billion euros – a growth that would have been 4 % excluding the additional week in the 2020 financial year. Hospitality chain La Place suffered from the coronavirus measures and contributed only 52 million euros, barely 4 % more compared to 2020.
In the Netherlands, Jumbo managed to increase its market share to 22 %. The retailer boasts about a rapid expansion in Belgium, as it more than doubled its store number from eight to seventeen. This year, that number should (almost) double again to 32. Several of the fifteen new Belgian stores will be stores in franchise.
Uncertainty is greater than ever
The changes and uncertainties are “greater than ever”, Van Eerd warned. There will be competition from new, international players, while persistent shortages of raw materials and transport capacity, sharp increases of purchase prices and an extremely volatile labour market are pushing up costs and putting pressure on margins.
“Our long-term customer-oriented focus means that, as a family business, we must continue to examine our earnings model critically and, if necessary, adjust our formula and operations accordingly”, they say. “Smart innovation and keeping costs under control are what it is all about in these challenging times.”
