The UK online grocery market has flourished with time, leading to the emergence of numerous startups like Dija, Weezy, Jiffy, and much more with different propositions. On top of that, the COVID-19 pandemic has turbocharged the demand for the online grocery business.
According to the report from Mckinsey, the United Kingdom has the most developed online grocery market in Europe, with 6.5 to 6.9% overall penetration in 2020 (compared with 5.0% in France, 1.7% in Spain, 1.5% in Germany, and 0.7% in Italy).
More than economic gains, online grocery platforms, at present, focus on increasing consumer loyalty, gaining market shares, and of course, sustainability.
Focus on sustainability
Earlier this year, London-based grocery company Good Club launched reusable product packaging and delivery boxes that are recovered from customers and cleaned for reuse.
On the other hand, British grocery giant Tesco teamed up with Loop for a reusable packaging scheme across its stores and delivery services.
Yet another firm that focuses on reducing plastic waste during grocery delivery is the Yorkshire-based The Modern Milkman. The UK-based company that started as an online milk delivery service has now also started grocery delivery. They have developed innovative ways to package fresh groceries in return and reuse packaging.
Raised undisclosed funding
Now, The Modern Milkman has announced the closing of a funding round led by Insight Partners. However, the company didn’t disclose the exact figures.
Existing investors ETF Partners and Serial Investor Simon Murphy also participated in the round. This funding round comes six months after securing £5M funding from ETF Partners.
How will the funding be used?
The funding will be used to create over 1,000 jobs in the UK and help save 282 million plastic bottles from landfills by the end of 2024.
In an exclusive interview with UKTN, Simon Mellin, founder, and CEO says, “The funding will be used to increase research and development, as well as support the business’ continued growth in the UK. Further, the investment will be used to expand the team to enable The Modern Milkman to develop innovative ways to package fresh groceries in return and reuse packaging. The expansion will also allow for further investment in bespoke technology.”
Right now, the company employs around 150 head office staff and has created job opportunities for 300 milkies.
Making positive impact
Founded by Simon Mellin in 2018, The Modern Milkman is committed to making a positive impact on the environment and the communities they serve.
The Modern Milkman has grown rapidly, resulting in a revenue increase of 1000% in 2020.
Since its launch, the company has helped reduce more than 187 tonnes of single-use plastic waste, which is equivalent to over 31,000 wheelie bins of plastic saved.
Mellin shares, “As a purpose-driven business, we are committed to making a positive impact on the environment and the communities we serve. Plastic pollution is a problem that’s not going away. It has a hugely negative impact on the planet, reducing biodiversity in the oceans, contributing to climate change, and even impacting human health. We aim to help people do their bit and reduce their environmental impact by providing convenient and accessible solutions to reduce waste and make plastic-free choices. To make a real difference, we need these solutions to be accessible to all.”
Expansion to Wales
Right now, the company operates in Lancashire, Yorkshire, Greater Manchester, Stafford, and Merseyside. The company is also planning to expand its operation into Wales by this year.
“We currently operate in the UK but are expanding rapidly, with the aim to hit Wales this year. We are looking to expand beyond the UK at a later date, but at the moment we are focussing the investment on hiring a world-class team and developing our bespoke tech to ensure we have the operational excellence and infrastructure to expand in line with our forecast,” he says to UKTN.
Commenting on the funding, Jeff Lieberman, Managing Director at Insight Partners, said “Consumers are reassessing their consumption, and they expect the businesses they buy from to help them on that journey. The Modern Milkman combines a focus on great customer experience with a business model that is suited to significant expansion to meet the needs of customers across the UK and beyond, and we are delighted to be supporting the company on the next stage of its growth.” As part of the investment, Brad Fiedler, Senior Investment Associate at Insight Partners, will join Modern Milkman’s Board of Directors.
Tomer Strikovsky from ETF Partners said, “The Modern Milkman’s growth is due to to the team’s ability to meet rapidly changing consumer demands. We are delighted to be further involved in the company as it continues to help consumers be more sustainable.”