Consumers have come to expect same-day delivery as a minimum threshold when it comes to online grocery, but a Canadian startup claims it can get groceries to customers’ door within as little as 15 minutes.
Tiggy founder Eugene Bisovka says that ultra-fast delivery has already become a consumer expectation in markets such as China, Russia and the United Kingdom, but that it is “virtually non-existent” in Canada, and is only just getting off the ground in the U.S.
Tiggy launched in Toronto this week after debuting in Vancouver late last year, offering nearly 2,000 SKUs across multiple categories such as produce, dairy and healthcare (including COVID tests).
The company claims “no surprises” for customers—meaning no delivery fees, price mark-ups, or subscription fees. It requires a minimum order of $10, a requirement it says can be met simply by purchasing one or two items.
“There’s…no other company in Toronto that delivers reliably within 15 minutes,” says Bisovka. “Larger grocery delivery players are only able to accommodate delivery in 30 minutes to an hour right now.”
Tiggy’s business model is built around what it calls “dark stores,” brick-and-mortar micro-fulfillment centres that house grocery items. These fulfillment centres enable Tiggy to deliver to customers within a two-mile radius within the company’s stated 15 minutes (although it says some deliveries could take up to 30 minutes depending on traffic and weather).
In Toronto, Tiggy currently has one dark store location at Queen and Richmond streets, with a second opening at St. Clair Ave. and Dufferin St. on Feb. 7. It operates four such centres in Vancouver, with another opening in Burnaby in March.
Bisovka acknowledges that Tiggy’s stated delivery time is “quite fast,” but says the company is confident in its capabilities because it was created with its own infrastructure, and its developers have “extensive experience” in Europe’s established ultra-fast delivery space. Tiggy’s average delivery time in Vancouver is 13 minutes, he says.
At the same time, its fulfillment centres are strategically located within high-density neighbourhoods, meaning that Tiggy’s bicycle couriers can make shorter trips while serving a larger customer base.
“From day one, Tiggy was built as a 100% micro fulfillment centre operator with the goal to provide customers with an unmatched ultra-fast grocery shopping experience,” says Bisovka. “We build our own micro fulfillment centres and design them as a compact warehouse for operational efficiency. We stock a wide assortment of handpicked products, and we have our own experienced cyclists that facilitate fast and reliable deliveries.”
Bisovka says customers in Vancouver have been “consistently increasing” the number of traditional grocery items purchased through Tiggy, such as bananas, dairy, fresh produce and other household items.
“This signals that there is a shift happening in consumers’ preferences of how daily essentials are being consumed and that the traditional grocery retail model is becoming less attractive for some consumers,” he says.
Tiggy recently raised $6.35 million in a seed funding round led by investment company Heartland, with additional participation from iNovia, Redbox Ventures, Global Founders Capital, FJ Labs and Banana Capital.
“The runway for ultra-fast delivery in Canada is exceptionally long, and we’re already seeing how it’s changing consumer habits for the better in Vancouver where we launched last fall,” says Bisovka. “There, our customers are cutting back on bulk buying and this significantly reduces food waste and the need for weekly trips to the grocery stores because they're ordering from Tiggy more frequently.
- Originally published at Canadian Grocer.