Dropezy Prepares a Way Out Amid “Winter Quick Commerce” Issues

Startups quick commerce Dropezy is reportedly preparing a strategy to stay afloat in the midst of conditions "tech winter". Currently rumored, the company closed all 20 dark store which is around Jakarta, according to the news Deal Street Asia.

Further confirmed by DailySocial.id, Dropezy Co-founder Nitesh Chellaram only said that the company is preparing a new strategy which will be announced soon to the public. "We can't announce our new strategy yet, but we have something interesting that can be shared soon," he said, Monday (19/9).

The company switched to quick commerce post-series A funding raised in September 2021 of $2,5 million. The funds were used to build dozens of dark stores spread across Jabodetabek.

Dropezy himself was born during a pandemic in early 2021 as a online groceries. The proposition is platform daily needs (daily needs platform), so that consumers can shop in small quantities several times a month.

“We believe in the concept of 'Buy small, eat fresh' and 'Top up, don't stock up'. We believe that Indonesians do not like to make bulk purchases at the beginning of the month, but prefer to buy in small quantities every day or on different days,” said Nitesh.

Dropezy's closest competitor, Astro is starting to develop products private-label, named Astro Goods. So far, the products that have been released range from snacks, fresh foods, ready-to-cook packages, to handicrafts. Next, Astro Kitchen for ready-to-eat food and beverage products. Mentioned, the company has more than 40 dark store the largest in Jabodetabek.

The downturn of the industry online groceries

Previously, HappyFresh was rumored to be doing business restructuring by appointing a consulting firm to review its financial condition. At the same time, layoffs and fundraising are being pursued to pay off debts to partners. Operations at a number of locations in Jakarta are also being discontinued.

This condition is not only in Indonesia, but also at the global level. Among them, Foodpanda, Delivery Hero, Ola, and Zomato, which closed the business unit quick commerceby doing efficiency.

In a research which is conducted by store.ai in the United States, states that only 2% of 1000 consumers are very willing to pay a little more to get their purchases within 15 minutes. Another 57,5% said they did not want to pay more.

A representative from Stor.ai said the findings show that customers prioritize stock items over prompt delivery. 27% of respondents said they would use ultra-fast services more if the user experience improved. Then, 22% complained of out of stock as the worst problem experienced when using the delivery platform.

According to GlobalData Managing Director Neil Saunders, the biggest fact of the business model of this quick commerce company has been broken from the start because the costs they incur are not covered by the fees paid by consumers. "Besides that, quick commerce is a solution looking for a problem. Most people don't really need things delivered in minutes."

In addition, with inflation continuing to increase and companies unable to compensate for costs, opportunities for business quick commerce to last long is very thin.