How Tech Startups are Changing Canada’s Grocery Industry

People have long become used to buying clothes, electronics and everyday goods online and having it delivered to their door; according to eMarketer, the e-commerce market is expected to rise nearly $30 billion this year in Canada.

With such an intense influence on the retail market, it’s interesting that grocery delivery services – widely available in countries like Europe and India for a long time – haven’t taken off as much in North America.

With many young professionals living in Toronto, there are many reasons why they’d need grocery delivery; with an extensive transit system, they may not see the need to use a car, or they may spend longer hours at work and don’t feel that they have the time to go grocery shopping. And as the issue of Canada’s aging population becomes a bigger conversation, the need for a service to cater to immobile seniors will only grow.

The latter is how Julian Gleizer, the co-founder of Instabuggy, thought of the idea for his service.

“A few years ago, my father was very ill and every day after work I had to pick up produce and products,” he says. “I thought, wouldn’t it be amazing if there were a service where I could order products and get them delivered to him?”

With Instabuggy, which was just launched in Toronto in early April, users can order groceries and have them delivered to their doorstep in one hour. In order to keep it under an hour, they use a combination of having their own drivers pick up the “pickers,” the people stationed at the grocery store who shop on behalf of users, and crowdsourcing.

Urbery, another grocery delivery app that recently launched in Toronto, also uses the crowdsourcing model to connect their fleet of “grocery gurus” to consumers. They promise delivery in under two hours, and work with the retail community to provide blended prices, which founder Mudit Rawat says still makes it cheaper than having to grocery shop traditionally. They are also working on getting the right licenses to eventually deliver alcohol.

Coming from India, Rawat says he never went grocery shopping because groceries were always delivered, and was surprised that no such service existed in Canada.

“It’s a North American thing,” says Rawat. “It economically never made sense for grocery companies like Loblaw’s or Sobeys to actually build this because it’s quite expensive to build their own fleet and logistics, and also figure out how to make money off of this business.”

Because of crowdsourcing and the rise of startups like Urbery and Instabuggy, grocery companies can rely on them to worry about operations and these startups can help create jobs and grow themselves. Unlike industries like the music industry, which, in the past, has been threatened by the wide availability of free downloadable music, the grocery industry benefits from tech startups, who actually have an interest in establishing close relationships with grocery stores – Instabuggy integrates their platform both on the consumer’s end and the retailer’s end to make the experience as seamless as possible.

Of course, like many startups, the impact of millennials who are accustomed to their lives being made easier through tech is cannot be understated in the transition to grocery delivery.

“Millennials are definitely about efficiency. We’re looking at high-dense, urban populated areas like the downtown core,” Gleizer says. “The majority of people living downtown don’t have a vehicle, and we’re also looking at young professionals who spend a lot of time at work. ”

Rawat also knows that the millennial generation will have a huge impact on the grocery industry. “Customers don’t have the patience and this hashtag, instant-gratification generation is really taking over.”