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VOL. 40 | NO. 35 | Friday, August 26, 2016

The world at your doorstep

Your doctor, liquor, meals, work, car repair, education – all home-delivered

By Hollie Deese

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There is nothing you can’t get delivered these days. If you can imagine owning it, it’s only a matter of time before it can be in your possession, brought to your front door within minutes, hours or days from the first moment you even conjured the thought of having it.

With today’s delivery services, it’s possible to never leave home to shop again.

There’s StitchFix for clothes, BarkBox for pet gifts, Plated for meals, Dollar Shave Club for razors, Birchbox for beauty and, of course, Amazon.

In addition:

  • Dose will send a doctor or nurse practitioner to your home for urgent and primary services.
  • Firestone will put new tires on your car – in your driveway.
  • Yoshi will fill your car’s gas tank, also while it’s in your driveway, and many local companies will wash and detail your car at your home or office.
  • Drizly will deliver liquor, wine and beer to your door.
  • Many area dry cleaners provide pickup and delivery
  • Mobile vets and pet groomers eliminate the need to drag them into a clinic.
  • Private and state college and universities offer internet-based classes.
  • Bigger, less-expensive high-definition TVs allow you to enjoy movies and sporting events without braving weather, lines, parking and $10 snacks.
  • Working from home is easier with gig-speed internet service.
  • And why visit friends? You’ve got Skype.

Really, why would you ever leave home?

Home delivery is a process that has evolved over time, from the Sears catalog and the milk man to a level of service and choice that has been upgraded for the app age.

Consumers expect nothing less, and entrepreneurs of various levels of experience are jumping on board, following the Amazon and Uber models to get goods to the customer as quickly as possible.

Galen Williams, 22, was a student at Pellissippi State College in Knoxville, juggling an internship with a network marketing company similar to Mary Kay and Amway when he decided to launch a local grocery delivery service in July 2014.

“I really wanted something where I could run my own schedule and be my own boss,” Williams says. “Over Christmas of 2013, my brother came into town from Manhattan and told me about all of these services up there that deliver groceries to people. I couldn’t help but think, ‘Wow, Knoxville doesn’t have anything like that.’”

Williams realized the logistics were a little bit different with the length of deliveries and the length between deliveries, but he figured it was a service the South needed. Six months later he made his first delivery as Plan-It Organic (www.plan-itorganic.com).

Grace McDaniels, left, with MEEL home delivery service chats with Julia Jackson during a drop-off at her Nashville home.

-- Michelle Morrow | The Ledger

He stayed in school, continued his internships and worked 80-hour weeks for the next eight months on the service, which allows customers to upload their grocery list and have Williams shop for them at Kroger, Food City, Walmart, Target or Butler and Bailey.

A small story on a local TV station helped boost his initial traffic.

“We were very fortunate in the beginning with how we acquired our customers and retention rate,” he adds.

Williams operated his ordering platform via email when he launched, and he still does today. It was about as low-tech as possible in an age of smartphone and apps. But keeping things low-tech also has kept Williams’ overhead low.

“It made it easy in the beginning to get it off ground,” he points out. “There wasn’t a lot of overhead except for gas and some flyers that I actually had printed up.

“In the beginning, it was really just a lot of leg work. I was spending three or four hours a day in parking lots just shaking hands and handing out these flyers. I did that for about a month. I would get a delivery or two a day, sometimes six a week.”

Today, he can capitalize on the bigger stores’ online ordering systems by picking up groceries his customers purchase online through Kroger’s Clicklist (www.kroger.com/onlineshopping ) program or Walmart’s new grocery pickup service (http://grocery.walmart.com). Without having to upgrade his own technology, and while also eliminating the time it takes doing the actual shopping since one of the store’s employees handles it, he anticipates being able to add more deliveries to his day.

“Most of my customers have learned if they just place their order through the website, it’s a lot more intuitive and they have pictures,” he explains. “Then I just swing through and pick it up. That has actually made my job a lot easier.”

Tech companies take over

Williams would love to have an app and an upgraded website, and maybe those things will come in time. “But right now we just really don’t have the money to do so,” he explains.

Cash on hand is critical to be a major player in the on-demand delivery service market.

DoorDash restaurant delivery service launched last month in Davidson County, the 27th market for the technology company that connects hungry customers with local businesses that likely did not have delivery service available before.

DoorDash Inc. announced in March that it had raised $127 million in its latest funding round, mainly from original investors. An article in The Wall Street Journal suggested it was a sign that the company – that began in a Stanford dorm room in 2013 – was struggling.

Through a DoorDash app or online, consumers can order food from more than 400 local restaurants including Local Taco, FLIP Burger Boutique, Nomzilla Sushi and Daily Juice Café, and 45 minutes later the sushi burritos and nitrogen milkshakes are right on the doorstep.

Hungry Nashvillians can select take-out from 400 area restaurants and have their orders deivered by independent contractors for a fee of $4-$7.

-- Submitted

The company charges a fee of $4 to $7 for each delivery, and works with independent contractors who deliver food from popular restaurants. These delivery people are known as “dashers,” and they are actively recruiting in Nashville on Craigslist.

“We want to have a fleet of dashers ready to go by the time we launch in any market, and then we are constantly looking for more people and more drivers,” says Kristen Webster, senior communications consultant with DoorDash.

Alex Kown is the Nashville manager of DoorDash. A graduate of University School, he helped launch Uber locally, as well its food delivery service, UberEats. His family is in the restaurant industry, and he has always loved the business.

“I was looking around at all the players in the food delivery space, and I was just really impressed with how DoorDash worked and how they maintain relationships with merchants, and just the overall experience through the app,” Kown says. “I started talking with them and eventually moved over and ended up launching the Nashville market.”

That was July 13.

“Growing up here I remember there were a couple delivery services, and I think what’s true for Nashville is true for a lot of cities,” Kown says. “Primarily, there was pizza delivery. Then any other service really wasn’t a great user experience.

“We’re averaging under 40 minutes from the time you place the order to the time it arrives at your door. It’s a convenience play, and I think a lot of people, given the price and given the little time that it takes to get to your door, are really interested in that now.”

Of course, the more people get the more they want, and customer experience is always top of mind, especially when it comes to using technology to improve what Kown calls the “last mile delivery.”

“We think of ourselves as really a technology company, and we’re building up a logistics platform, where essentially you can put any product on it to get delivered to you,” Kown explains.

“We’re not quite there yet. We’re testing alcohol and some other markets, but I think people just have that expectation to get everything on demand and everybody’s trying to compete for that last mile.”

But keeping enough drivers on hand to match the demand has been tricky for all of the services, DoorDash included. Too many on the road at once and no one makes money. Not enough, and customers wait longer than they want.

“We’re continually assessing the need of drivers based on demand,” Kown says. “It’s just this balancing act between supply and demand. We’re always just growing it and onboarding new dashers every week basically.”

Kown says the system they use is slightly different system than Uber, which basically allows an unlimited number of drivers at any given time. DoorDash uses more of a scheduling system.

A meal kit prepared by HelloFresh waits in the refrigerator.

-- Submitted

“We limit the number of drivers that can go on, and what this does is it helps ensure that drivers make a certain hourly wage every hour,” Kown adds. “I think it takes care of the driver and makes sure that they’re making enough to make it really worth their while.”

But Nashville is a hungry market, and Kown admits it’s been tough to meet the consumer demand.

“It’s really been a rocket ship ride here in Nashville,” he says. “We’ve been growing incredibly fast compared to a number of cities we’ve launched in, and I think that does speak to the need and the desire of Nashville to have a service like this. It’s been pretty quick, and we’re struggling to keep up with demand right now, to be honest. We’re definitely short on drivers and trying to get as many on the road as we can.”

Service with DoorDash right now is limited to the core of Nashville, from East Nashville to Forest Hills, and then from North Nashville to Berry Hill. Once things get in a groove, then service will grow to Murfreesboro, Hendersonville, Franklin and more locations, Kown says.

“What that comes down to really is just making sure that we have enough drivers on the road in those areas, making sure that we have great relationships with restaurants,” Kown says. “Once we feel really good about that, then our plan is to expand.”

Competing with Amazon

One year ago in July 2015, Shipt launched in Middle Tennessee, shopping at Publix grocery stores, which allows customers to select from the full range of more than 40,000 items at Publix using Shipt’s integrated mobile app.

The app allows customers to select specific items and can include everything you’d find if you shopped the store yourself, including fresh produce, meat and perishable items.

The cost of the service is $99 annually or $14 monthly. In addition, users can tip their shoppers for a job well done. Deliveries can be scheduled for one-hour windows as soon as one hour after the order, depending on the availability of drivers.

That means you might get your order within an hour one day and have to wait a day or more on your next order.

All of the local services are trying to compete with Amazon, a company that is notoriously tight-lipped about its delivery service. An Amazon spokesperson via email said its objective is to provide the best possible options to make Prime members’ lives easy, and that includes offering customers a wide range of products and fast, free delivery.

In addition to 2-day shipping benefits, Prime members in eligible areas like Nashville can get even faster Prime FREE Same-Day Delivery and ultra-fast one- and two-hour delivery with Prime Now.

Available in Nashville, users can order from a selection of thousands of items in the morning, seven days a week – even Sunday – and have it delivered before bedtime for free.

“We don’t comment on our future product roadmap, however, as we invest in our growing fulfillment network we will continue expanding our delivery capabilities,” Amazon replied in a statement when asked about Amazon Prime Air, the much-talked-about drone delivery service, or about the possibility of the company building its own fleet of delivery trucks in addition to third-party services like USPS, UPS and Fed Ex.

Food delivery surges

Julia Jackson picks up a MEEL crate outside her front door.

-- Michelle Morrow | The Ledger

It’s not just cooked meals from restaurants or grocery items available to consumers, but its meals sent with all the ingredients needed to prepare a dish for two or four people who like to cook. HelloFresh (www.hellofresh.com), Blue Apron (www.blueapron.com), HomeChef (www.homechef.com) and Terra’s Kitchen (www.terraskitchen.com) are just a few such places currently serving Tennessee.

Teresa Belisle of Hendersonville was gifted a free trial of HelloFresh by one of her stepdaughters at Christmas and liked how the meals were planned step-by-step and that the box included everything she needed, down to the seasoning. For someone who likes to cook but doesn’t have a lot of free time, the service worked.

“The meat, it is organic and very fresh, and everything we’ve had has been very good,” she says. “But to me, I thought it was costly.” A two-person plan costs $69 a week and includes enough food to make three meals for two people.

Of her six children and stepchildren, only one is still at home while attending college, so Belisle, 50, would even take a meal meant for two and stretch it to three by adding an additional side salad.

“If I had another coupon I’d probably do it again because I have done it, and I do know it’s really good meals and it’s fairly easy,” Belisle adds. “Each one probably actually took me 15-20 minutes, and it tastes very good, but it’s not something that I would do every week. That’s going to be over a couple hundred bucks a month, and I just don’t see doing it.”

HelloFresh launched on the East Coast in December 2012 and moved to cover the entire country in September 2014. The U.S. is now HelloFresh’s largest market, but it also serves nine countries, most recently launching in Switzerland and Canada.

Globally, HelloFresh delivered 7.5 million meals in March 2016 to over 800,000 active subscribers.

“We absolutely listen to customer feedback to continue to improve our product,” says Shara Seigel, senior manager of public relations at Hello Fresh. “We are constantly testing, from new recipes, ingredients, packaging methods and materials. Many people want to cook at home more, but struggle.”

Services like HelloFresh takes care of what a lot of people consider to be the hard parts of cooking – planning, shopping and prepping – and provides a shortcut right to the stove.

In terms of new services, Seigel says they recently rolled out meal preferences on the HelloFresh website where customers can opt-in or out of certain choices, like choosing only meals under 650 calories, meals that take 30 minutes or less to cook, or even beef-, pork- or seafood-free options.

“We launched a Family Box in January 2016,” Seigel explains. “In the same month we also launched a partnership with celebrity chef Jamie Oliver. Every week, one of Jamie’s recipes is available as a HelloFresh recipe option. For every box customers order with Jamie’s recipes, HelloFresh donates to the Jamie Oliver Food Foundation.”

‘You make something. You sell it.’

Local companies are emerging to compete with the national meal-kit services, like Nashville’s locally-sourced organic meal subscription kit MEEL (www.localmeel.com) launched by Marti Emch two years ago after selling her Denver-based marketing business.

A Middle Tennessee native – her parents have a farm in Dickson County – Emch returned to Nashville about seven years ago. Her twins recently turned eight.

“It was really a wonderful business, just life was very stressful,” she says. “I knew I wanted a family, so I decided to not do that anymore. I’ve always been a big foodie – friends back in college used to call me ‘Marti Stewart’ because I was always making pretty food and taking it to them.”

She came up with the idea of making organic granola and sold it at the 12South Market for about four years.

“No one was really doing that here in Nashville at the time, and I thought it would be a fun thing to introduce my kids to, so we did a booth at the farmers market so I could teach them about entrepreneurship and how you make money,” she points out. “You make something. You sell it.”

But while at the market, Emch noticed an even greater need than for granola. Moms and families at the market each week trying to figure what’s for dinner.

“The idea for doing meal kits came to me in the middle of the night,” she says. “Then I started researching it and realizing that there were a couple of companies at that time doing it. I think they were both in New York, Plated and Hello Fresh. That’s when I knew this is a viable idea.”

Emch also wanted to support local farms, and she felt more people want to support local farms, too. But because of their busy schedules and the timing of the farmers markets, it was incredibly difficult. “I feel like my idea was a way to bring that food to people in the form of convenience,” she explains. “They’re getting convenience and that connection to the local food community.”

Keeping the name MEEL from the granola business, she began doing meal kit delivery two years ago this month and has a pool of about 100 subscribers that fluctuates every week. In a kit subscribers get two meals, one with meat or fish, the second is vegetarian. The meals are mostly gluten-free just by nature, though they do include bread each week from Sam Tucker’s Village Bakery and Provisions, and last week did a pasta meal with noodles from Nicoletto’s Pasta Company.

Emch says planning the meals is the most time consuming, and the cost of food is her biggest expense. It takes constant communication with the rotation of farmers she works with, determining what is available, combing through her collection of recipes collected over 20 years and figuring out how much is needed each week.

“It’s all a different piece of the process, getting the ingredients and doing the prep work,” she adds. “This past week we did a Nicoise Pacific cod en papillote, so you had a certain amount of Kalamata olives, a certain amount of capers, cherry tomatoes, a little bit of white wine.”

Because of all the work that goes into making it all come together with minimal waste, Emch doesn’t anticipate allowing subscribers to choose their meals – what is available each week is what is sent.

“In that regard, it’s like a CSA,” she says. “You have to be open to seasonal eating and open to whatever is coming your way. I think some people want more control over that, or maybe they have children that are picky eaters so they’re not sure. You can’t be too picky. It’s really created for omnivores.”

Emch says she would love to add more meals, but this fall she will be introducing a variety of add-ons for her subscribers, including a dozen local farm eggs, some artisanal food products, a fresh bouquet of flowers or sandwich bread for lunches.

“I always wanted to try to grow it small, organically, and that’s the path I’ve been on, but I can handle more growth and I’m ready for that,” Emch says. “We started delivering to Franklin earlier in the summer to the community of West Haven. We also started East Nashville delivery this summer. I’m looking to grow.”

Meeting customer expectations

In terms of longevity, restaurant-delivery service GrubHub (www.grubhub.com) is a mainstay, launching in Chicago in 2004 by Matt Maloney.

Working late one night at Apartments.com, he realized there was not a similar aggregator for restaurants that offered their menus online, says media relations manager Kaitlyn Carl. A few years ago they merged with Seamless, another delivery service that had been operating in New York since 1999.

The company’s focus, in both Nashville and Knoxville, is to keep improving upon the customer experience.

“Over the past year we’ve been able to roll out some new products and that’s definitely where our focus is now,” Carl says. “In addition to focusing on the tech side, we’re also starting to branch into the delivery space as well.

“In the past, we actually only worked with restaurants that were able to provide delivery for themselves, and now we’re branching into restaurants that don’t really want to deal with the logistics of providing delivery, and we’re able to provide that last mile for them.”

In Nashville, there are more than 130 restaurants operating on the GrubHub platform. In Knoxville, it’s 25.

“In the past it was very focused on the larger cities, but our college towns definitely are huge drivers of order volume,” she adds. “We’re certainly not forgetting about them, and I would say that’s probably why the Knoxville area continues to grow, at least in terms of GrubHub growth.”

For consumers, the ultimate benefit to all this delivery is getting exactly what you want without having to go get it.

“As a matter of fact, we used Amazon last night for Enterprise Rent-A-Car in Hendersonville,” Belisle says. “We were looking for one of those little sanitary waste disposal things in the bathroom and I’d called everywhere in Nashville. I hunted, I searched. I was like, ‘You know what? I’m just going to get it on Amazon.’ And sure enough it popped up.”

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