Scoop: Wonder Readies for Texas Expansion
Walmart tests dark stores, DoorDash adds grocers, courier multi-apping
Modern Delivery is kicking off the week with an exclusive scoop: delivery super app Wonder is readying an expansion to the South; we get into the details and implications below. Plus, DoorDash adds regional grocers, Walmart gets into dark stores, and more gig workers turn to multi-apping.
Today:
Wonder Wanders Into Texas
DoorDash’s Growing Grocery Gang
Chart Time | It’s A Multi-App World
Walmart Goes Dark (for Delivery)
EXCLUSIVE | Wonder Readies for First Foray Out of Northeast
Wonder — the self-purported super app for mealtime — is getting ready to finally leave the cozy confines of the Northeastern United States. Late last week, we spotted a job listing looking for a Real Estate Manager to lead “sourcing locations for [Wonder] restaurants across Texas.” When we shot a message to Tony Hoggett, Wonder’s COO, he confirmed the plans, adding, “Not much to share currently. Watch this space.” (See our earlier chat with Tony about all things Wonder.) While Wonder-owned Grubhub and Blue Apron operate nationwide, this would be the first expansion of its core food hall + first party delivery concept beyond the NYC and Philadelphia metro areas.
The Big Picture: Obviously, Wonder is going to have to step up its growth to keep up with its lofty $7B valuation and 2028-targeted IPO. Delivery thrives on density, so a push into Texas is a curious next step. Yes, employers have flocked to Austin and Dallas in recent years, overlooking the state’s perilous laws for women and minorities in favor of its lightly-regulated, pro-corporate environment. Texan cities’ sprawl at first glance makes them more logical homes for aerial delivery, whereas expanding to markets on the West Coast or further up and down the Acela Corridor might better match Wonder’s existing operations. But, Texas does have another factor that should foster this expansion: Dallas is one of the most chain-oriented dining cities in the country. In a state where Applebee’s and Chili’s prevail, Wonder’s model of licensing and duplicating hot restaurant brands like Di Fara Pizza and Bobby Flay Steak will likely be quite warmly received.
Wonder has one additional new project in the works to bolster growth: an email to restaurateurs listed on Grubhub revealed those merchants will now be included in the Wonder app as well, on a new tab in the super app dubbed Wonder Local.
3PD | DoorDash Adds Regional Grocers
DoorDash continues to add new supermarket chains to its roster of merchants. Last week, the 3PD announced a slew of small to mid-size, regional grocers:
Big Y: A family-owned supermarket with 75 locations in Massachusetts and Connecticut.
Citarella: A seafood-oriented market with seven locations across NYC, the Hamptons, and Connecticut.
Gelson’s: A Southern California gourmet grocer with 26 locations
Gordon Food Service Store: Serving both everyday consumers and restaurants with grocery and bulk offerings at 180 locations across the Midwest, Florida, and Texas.
The Big Picture: Groceries and retail continue to be a growth area for DoorDash and its competitors, with DD users spending record amounts on the category in Q1. DoorDash now hosts over 11 million grocery / retail products, with 25% of users shopping these “new verticals” category. While the delivery giant currently serves 94 of the top 100 restaurants, it only has partnerships with 44 of the top 100 retailers, giving it plenty of runway for continued expansion.
CHART TIME | Multi-Apping Is the New Normal
New data from Everee studies the motivations and tribulations of the gig workers that power delivery and ridehailing. With 68% of workers using multiple apps at once, the platforms that offer lackluster benefits like slow payout times are at constant risk of seeing their labor force turn over.
OPERATIONS | Walmart Tests Delivery-Optimized Dark Stores
Walmart has begun testing dark stores: smaller warehouses that resemble its retail locations but are closed to the general public and are instead optimized for its delivery workers. The Bentonville Big Boxer launched a pilot location in Dallas, is in the process of opening another by its Northwest Arkansas HQ and is exploring additional locales. Walmart previously experimented with dark stores, “pickup points,” and MFCs in 2019, but the company wound down its last round of pilots during the depths of the pandemic.
The Big Picture: Walmart’s e-commerce segment finally achieved profitability in Q1, with domestic sales up 21%. While Walmart now fulfills 1/3 of online sales in three hours or less, consumers have ever-faster expectations. While the company’s footprint of over 10,000 stores means it’s already quite close to almost every American, forcing couriers to scour shelves and dodge other shoppers can be a real impediment to speedy operations. Amazon’s 1,000+ facilities in the U.S. are purpose-built for delivery, and now Walmart’s getting ready to catch up.
A Few Good Links
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