Fast-paced grocery delivery is experiencing growth, with Woolworths New Zealand’s leader identifying it as the fastest-expanding segment of the business.
The Australian grocery retailer reported a 23.7% increase in third-quarter e-commerce sales for its New Zealand business last week, which contributed to a 4.8% rise in total sales for the three-month period, reaching $2.19 billion.
“[Fast delivery] would be the fastest-growing part of the e-commerce business, but it comes off a much fuller base,” Woolworths NZ’s interim managing director, Pieter de Wet, told BusinessDesk.
E-commerce sales at the retailer consist of a range of services that differ by store and brand. Woolworths stores provide several click-and-collect options, including direct-to-boot pickup, eLockers, and Express Pick Up.
Milkrun, a Woolworths subsidiary, enables customers to order over 10,000 grocery items for home delivery from selected Woolworths and Countdown stores across New Zealand. Customers outside Milkrun’s delivery areas can use other Woolworths delivery options, typically at a higher cost.
Woolworths acquired Milkrun in 2023, launching the rapid delivery service in New Zealand soon after. Orders are picked and packed in-store, with delivery times averaging under an hour.
“Direct to Boot is now available in 52 stores with Milkrun available in 77 stores,” De Wet said.
“Nearly 30% of all delivery sales are now delivered within two hours, and about 80% are delivered within 24 hours. If you think back, even three years ago, very little would have been delivered within 24 hours.”
De Wet said the company has surpassed its delivery targets and expects continued growth but does not foresee e-commerce sales overtaking in-store sales.
Woolworths reported an improvement in its approval rating among customers to shareholders.
The company operates 185 supermarkets in New Zealand, along with 66 FreshChoice and 12 SuperValue franchise stores.