A Toronto-based startup is trying to change how consumers buy their groceries; while providing a personal and local touch.
Inabuggy, a same-day online grocery and alcohol delivery service that launched out of Toronto in 2015 as a pilot in partnership with Fresh Co. under the name Instabuggy, started out catering to higher-end clientele but recently adjusted its business model to allow it to serve a much broader demographic.
“We had markups on our groceries and we had a delivery fee. So we noticed that we had created a niche market in Toronto only to the users that can afford the service because of the markup,” said founder Julian Gleizer. “And what we saw was that it was imperative that we scale our services across the country and reach the mass market and have this available to everybody as opposed to having a niche market.”
In September 2017 it did exactly that, by moving away from the marked-up prices to the in-store prices, and simply having a flat delivery fee ($19.98) applied to the order.
And since doing so it has managed to launch into four major markets in Canada – Ottawa, Vancouver, Calgary, and Montreal – and is continuing to keep an eye on widening its reach into cities and regions across the country.
This expansion has not only allowed it to reach more customers but has also given it the ability to experiment with some features that Gleizer believes will put it ahead of the competition in the online grocery delivery business, such as Instacart (who charge a 7.5 per cent fee on top of its $3.99 delivery fee). The grocery business has been rushing to innovate after Amazon’s 2017 purchase of Whole Foods presented a potential disruptor in the marketplace.
In addition to its white glove service, which allows people who are not fully physically able to have their groceries not only delivered but also packed away in their house, and its Inabux cashback rewards system, it has established partnerships with a multitude of local grocery stores that Gleizer says have been very beneficial to those stores.
“These retailers are brick and mortar retailers that depend on customers walking through their front door to shop. So now what we’ve allowed them to do is we provide the capability to have a further reach to their customers,” said Gleizer. “You can see their customers are typically located within a two to three kilometre radius. What we do is we extend and we offer their services to the outside parameters of their customers. So that increases their revenues.”
By partnering directly with those stores, as well as Consumer Packaged Goods companies (CPGs) like Marcangelo and Unilever, it is now able to provide exclusives deals and discounts on products that consumers would not have available to them when shopping directly in the stores themselves.
While Inabuggy is only available in the previously mentioned five major Canadian cities, in the future it is hoping to expand across Canada and is currently hiring 100 new workers.
“We’re very focussed on covering the Canadian market and ensuring that we service all the metropolitan as well as all the different regions across Canada,” Gleizer said. “That’s on our priority list right now which we are scaling on a daily basis as we speak.”