Food to the door has become more popular, but not profitable

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Groceries delivered to the door is a growing market, but neither Meny nor the specialist, Kolonial.no, make money on home deliveries – yet.

Growth in grocery stores is 1–3%, but e-commerce with food and drink is growing many times faster. From 2015 to 2016, sales increased by 40%, and growth continues wrote Adresseavisen newspaper.

The Men tripled web sales last year and ended at 210 million,
but it was not enough to go into profit.

‘’This service is not profitable today. It has mainly to do with volume’’ said Knut Nyløkken, e-commerce manager in Meny. However, he thinks several of their online stores may become profitable, perhaps already by this year.

Kolonial.no, the largest food store online, is approaching the billion mark in sales. In 2017, revenue increased to NOK 801 million, but the deficit ended at NOK 256 million.

The figures for 2018 have not yet been published.

‘’The deficit (in 2017) was due to the fact that we had invested in extremely strong growth and improved capacity.

But we have now reduced the losses a lot and have again started marketing’’ said CEO, Karl Munthe-Kaas. He has no date for when the company will begin to go into profit.

Egil Becker of the consulting company, Qvartz, recently told E24 news that a pure e-commerce player in the grocery market probably has to sell for just over two billion to get to zero.

© NTB Scanpix / #Norway Today

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