Uber strengthen grocery delivery arm after partnering with Gopuff

Uber has announced a partnership with snack delivery start up Gopuff in a bid to expand its grocery delivery services in the US.

Gopuff delivers “essential” items such as alcohol, local favourites, beauty and pet products, snacks and over the counter medicines.

Uber will take a cut of each transaction while the start-up handles the logistics and delivery of items.

We built a hyperlocal logistics network of micro-fulfillment centers,” Gopuff senior vice president Daniel Folkman told CNBC.

“We own all the inventory. We are buying all that inventory from manufacturers and distributors so we are able to fulfill those orders to customers in under 30 minutes, 24 hours a day.”

READ MORE: Uber Eats looks to take a bite out of JustEat’s German monopoly

Gopuff currently operates in 650 cities in the US and its collaboration with Uber will launch in more than 95 US cities next month with a national expansion expected later this summer.

Uber’s move to strengthen its delivery services come after its poor financial performance last year, its ride hailing arm suffering big losses in particular, completing 30 per cent fewer trips than in 2019.

With the pandemic-driven drop in its taxi service, Uber has increasingly turned to its Uber Eats arm to pickup the slack, signing numerous partnerships with big name retailers in the UK.

Last month Sainsbury’s expanded its partnership with Uber Eats to 100 stores across the UK as it continues its heavy investment in rapid delivery.

The grocer announced plans to extend its partnership with Uber Eats to a further 78 stores across the UK following a successful trial in 25 stores last year.

However, Uber will have its work cut out for it in the US as it competes with food delivery giants Amazon and Instacart, the latter now being valued at over $39 billion after a funding round in March.

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