On the eve of the announcement of the acquisition of Frichti by Gorillas, Julia Bijaoui, the co-director and founder of the French foodtech company, and Pierre Guionin, General Manager France of the German quick merchant, tell us more about the synergies to come in this booming market.
What are the objectives of this acquisition for Frichti and Gorillas?
Julia Bijaoui, co-founder and co-CEO of Frichti. We had a number of choices on the table, one of which was to pursue our path independently. For the past six years, we have been trying to build a 'new generation supermarket', a service that helps people eat better in the most convenient way. A few months ago, when we met with Kagan [Sümer, founder and CEO of Gorillas], we realised that we had a vision that was extremely congruent with what we wanted to build for the customer, as a company and finally in our working values.
We had developed quite complementary things. Gorillas has succeeded in less than two years in offering its services in 9 countries, and is experiencing tremendous growth with a significant amount of capital to support this development. And we, starting from another point over the last six years, have developed technological and operational know-how, but also different categories, not just groceries, cooking kits, ready meals. Categories in which Gorillas was positioning itself.
We are only at the beginning of this market to conquer. In this revolution of commerce, we prefer to do it together with the best talents, the best teams and the best chances of success, than each one in its corner.
Pierre Guionin, Managing Director France. On our side, Gorillas has been growing rapidly in just under two years. We are already present in nine countries, with more than 200 shops open, over 60 cities and 12,000 employees. We are on a fairly rapid development path with a model that has already proved itself in two years in a number of respects. However, in order to enter this market on a permanent basis, we need to offer the customer an extremely complete package. It must meet all its needs throughout the day, the week and even the month. And for that, we need to diversify our offer. There is a very strong complementarity between Frichti and our company. In terms of synergies, Frichti has acquired many skills, including operational and technological expertise.
When you couple the speed of our development, our international presence and the strength of our teams, with this highly specialised expertise in Frichti's businesses, we are gaining maturity incredibly quickly. This allows us to serve our customers better and to accelerate this transition to quick commerce. The industry will grow even faster and move towards profitability. Frichti has demonstrated this.
Also read: Gorillas to take over Frichti
When will it be completed?
Julia Bijaoui, co-founder and co-CEO of Frichti. In a few weeks or months! It is difficult to say today precisely.
Are you staying on as a director of Frichti?
Yes, absolutely. Quentin [Vacher, co-founder and co-CEO of Frichti] and I continue to be extremely involved. There is no departure date. We will have two missions within the group: to continue to grow the French market by creating the right synergies between Gorillas and Frichti. Our objective as a joint entity is to continue to gain market share, to grow our business and our services, by sharing our strengths in order to provide the best value proposition to our customers. We have developed many bricks over the last six years. The aim is to scale them up internationally and develop them in the other Gorillas geographies. This obviously involves our technological and logistical know-how, but also, in the future, ready meals and private labels. We will proceed according to the group's priorities.
Will you merge?
Julia Bijaoui, co-founder and co-CEO of Frichti. It is indeed a merger. However, the Frichti brand is not disappearing, nor is the service. We are creating new synergies as we go along, but with our two brands.
What is this vision of the new generation supermarket?
Pierre Guionin, Managing Director France. Julia and Quentin saw things before anyone else. We have observed, especially since the appearance of delivery platforms, that consumption patterns have changed. Today, the consumer's needs have evolved: they need more speed, more flexibility and above all a service that allows them to save time. This started with home delivery, of course, but also via e-commerce companies. All of these players helped to increase the quality of the service. Then Covid was a real catalyst. When the service was born in Germany, there was an extraordinary infatuation with this new mode of consumption. It is no longer the customer who adjusts but the service. He no longer has to schedule his needs in advance and suffer this constraint.
We are switching to a constrained mode of consumption, to which we respond with immediacy and diversity whatever the time of day or the need. We will be able to offer ready meals, food kits, national branded products, but also, for example, the baker's baguette. This mode of consumption, which is still fairly marginal, is a groundswell. We must keep operating without deteriorating the service and through a stronger offer
Can we imagine a three-way partnership with Groupe Casino as Carrefour has done with Uber Eats and Cajoo?
Pierre Guionin, Managing Director France. The partnership concluded with the Casino-group and in particular with Monoprix- goes far beyond this, it concerns both supply and delivery. There is also an equity investment by the Casino group. It will allow us to accelerate our development and to do so under the best conditions for the customer. The Monoprix brand is doing extremely well in our shops (dark stores) today. As far as synergies between the Casino Group, Frichti and Gorillas are concerned, there are a lot of possibilities and synergies that can be achieved. We are currently evaluating this.
Has the consolidation phase in quick commerce begun?
Pierre Guionin, Managing Director France. We are still 12 actors on the market. Quick commerce needs to grow. We need to keep communicating about our services. There are still a lot of customers who don't understand what we do. I think it is very healthy that there is competition in this market. Gorillas is a leading player in Europe, with rapid growth, and will consolidate this position. With Frichti we will further raise the quality of our services.
What will happen to the Frichti suppliers who have the status of micro-entrepreneurs? Will Gorillas employ them?
Julia Bijaoui, co-founder and co-CEO of Frichti. We will continue to trade separately. Our respective models are not going to change.
Ten months of activity in France, a valuation of 3 billion, isn't that a bit dizzying?
Pierre Guionin, Managing Director France. Our fundraising is important because the mission is important. It requires a lot of capital, especially to be able to pay our riders (delivery people). We rely on very solid investors. Our objective is not capital intensive.
To expand into new cities and hire our employees, we need this capital. Our aim is to build a new generational model of consumption by joining forces with the best like Frichti, and in the long term.
What are the next steps?
We have a yearly development plan that will lead us to increase the number of sites we already have and to study the next cities. This is also an opportunity to have a cross-view with Frichti to understand strategically where it makes sense.
Like other players, you have withdrawn the reference to delivery in 10 minutes on the app and the website, why this change in communication?
It does not correspond to a change in the customer experience. It stays the same and remains at the core of our concerns. Today, our average delivery times are exceptionally low. But when you say ten minutes, customers expect delivery to be made within that time. Sometimes the paths are faster but they can be longer. Nevertheless, the average is still extremely close to 10 minutes. The most important thing for us is to be transparent to the customer about the actual time. When the customer orders on Gorillas, via our algorithm, they have an approximate delivery time depending on the size of their basket, the geographical location, the time of day... The aim is to make our teams work in the best possible conditions without putting unnecessary pressure on them. This is why we have stopped communicating formally about the 10 minutes, while remaining as close as possible to the customer promise.