Boots launches on-demand delivery trial with Deliveroo

Posted on 24th Aug 2021

The pharmacy chain Boots will become the latest large retailer to make its products available through Deliveroo, as the takeaway delivery company aims to expand beyond restaurant orders.

Stores in London, Birmingham, Edinburgh and Nottingham will be among the 14 initially available in the trial as part of a pilot scheme launching on Tuesday.

The deal will mean customers will be able to order medicines and painkillers for milder ailments such as coughs, colds and hay fever for home delivery. Makeup, toiletries, baby products and snacks will also be among the 400 products initially available from US-owned Boots, which is Britain’s largest pharmacy chain.

If the Boots deal is rolled out nationwide it would add to Deliveroo’s growing business delivering groceries and other products beyond takeaway food orders.

Deliveroo was started by Will Shu, a London-based investment banker, when he spotted a gap in the market for takeaway deliveries. However, in the first half of the year, groceries accounted for 7% of Deliveroo’s transaction volumes, and the company has partnerships with Waitrose, the Co-op, Morrisons, Sainsbury’s and Aldi among the UK’s major supermarkets.

However, the on-demand grocery market – still in its infancy – has rapidly become more competitive, with well-funded new entrants such as Getir, Weezy, Fancy and Gorillas. They are spending heavily on networks capable of delivering a relatively small selection of products to customers in large cities within minutes.

Paula Bobbett, the director of Boots UK’s website, said the retailer had focused on products for parents and ill people who could not easily leave home.

The other towns and cities included in the initial trial are Brighton, Cambridge, Croydon, Leeds, Liverpool, Milton Keynes, Newcastle and Southampton.

Deliveroo endured a torrid first few months on London’s stock market after it suffered one of the worst share price drops in the London Stock Exchange’s history on the first day after listing. Some investment managers expressed concerns about the rights of its workers, who are treated as independent contractors, while others said they were avoiding the float because of US-style limits on shareholders’ voting power.

However, the company’s valuation has risen steadily from its April lows, and it closed above its 390p listing price for the first time last week, a month after saying that sales were going better than expected. On Monday it closed just shy of its listing price, at 389p, valuing it at £6.7bn.

Source: The Gaurdian