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·         Coronavirus Outbreak Drives Demand for China’s Online Grocers

·         China’s food delivery workers are lifeline in coronavirus outbreak

 

 

Coronavirus Outbreak Drives Demand for China’s Online Grocers

 

Lulu Yilun Chen and Kari Lindberg, Bloomberg

via Yahoo Finance - February 10, 2020

 

(Bloomberg) -- Like their counterparts in Silicon Valley, China’s largest tech companies struggled to prove online groceries can be a viable business. Then the novel coronavirus struck.

 

Its spread has extended a lifeline to a slew of money-burning businesses -- many backed by big name venture capital funds and tech giants from Alibaba Group Holding Ltd. to Tencent Holdings Ltd. -- that in some cases were on the brink of collapse in 2019. Millions of consumers shunning supermarkets and meal-delivery services are testing promises by Tencent-backed Missfresh or Alibaba’s nationwide Hema chain to ship fresh food to their doorsteps. Those that deliver can expect many of first-time customers to stay even after the epidemic burns itself out.

 

The boom is one more way in which the abrupt onset of the epidemic is transforming consumer behavior in the world’s No. 2 economy. Usage of other online services from mobile gaming to internet malls is surging as the epidemic confines millions to their homes.

 

“Before the Chinese New Year, many of these firms were looking precarious and their only lifeline was the deep pockets of their big backers,” said Michael Norris, research and strategy manager at Shanghai-based consultancy AgencyChina. “Right now, fresh grocery delivery platforms are seen as an essential for consumers to minimize risk of infection.”

 

Not all of them are equipped to handle the sudden increase in demand. The most immediate obstacles include a shortage of delivery staff, inventory management and the difficulties of navigating physical roadblocks put up by local governments trying to curb the disease’s spread. And if the coronavirus outbreak hurts the economy, expect that also to squeeze funding overall for all tech startups.

 

The epidemic has led consumers to seek eating options that are healthier than takeout, especially with online chatter about the risks of take-out delivery people transmitting the disease. There’s less of a concern around fresh food since delivery frequency is lower than takeout and many people take comfort in cooking their own meals.

 

Norris sees the outbreak ushering in another boom era for e-commerce in China. Overall, he expects online to account for a third of China’s retail sales in 2020, up from around a quarter last year.

 

Alibaba’s Hema chain, including 18 stores at the epicenter of the outbreak in Wuhan, have operated non-stop during the extended Lunar New Year break. Online orders have spiked, prompting Hema to increase its vegetable supply across Beijing, Shanghai and Guangzhou, the company said in a statement.

 

Missfresh saw a quadrupling in online orders for groceries during the first five days of the Lunar New Year compared with the same time last year. The company sold 40 million...

 

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https://finance.yahoo.com/news/coronavirus-outbreak-drives-demand-china-210000428.html

 

 

China’s food delivery workers are lifeline in coronavirus outbreak

Couriers provide temperature readings when supplying millions quarantined at home

 

Yuan Yang in Beijing, Financial Times

Feb 11, 2020

 

For the tens of millions of Chinese people quarantined at home by the coronavirus epidemic, food deliveries and the people who prepare and deliver them are essential routes to the outside world.

 

But many shut-ins want to be sure that while their food is hot, the people providing it are not. In addition to the usual price and other information, many restaurants are also including a “reassurance guarantee” slip with the temperatures of the cooks, food packagers and courier for every order.

 

“These couriers have become the heroes of China along with the medical professionals,” said Shaun Rein, managing director of China Market Research Group. “The online food retailers have calmed the country down more than anyone, even the government, because they are showing people they can buy food at reasonable prices.”

 

Scooter-riding couriers have become ubiquitous on China’s city streets with the rapid growth of the online food delivery market, with more than 400m monthly active users and Rmb600bn in transactions in 2019, according to market research firm Trustdata.

 

Meituan, the industry leader and China’s third most valuable publicly listed technology company, gives its couriers a card to pin to the yellow jacket of their uniforms that details their temperature and whether they have conducted the daily disinfecting of their delivery box. Eleme, Alibaba’s rival service, does the same.

 

Many restaurants have opted to provide additional information on their own hygiene practices. Yunhaiyao, a popular food chain, says it measures the temperature of the cook, the food packager and the courier for every order. The restaurant writes the data along with the staff members’ names on a slip of paper.

 

“It’s very convenient and fast, we have handheld temperature sensors to check people’s wrists,” said a Yunhaiyao employee.

 

Nayuki, an upmarket tea and dessert chain, goes one step further by separately detailing the temperatures of the tea brewer and bakery chef on the paper slip.

 

One Beijing-based Eleme delivery worker, who asked to remain anonymous, said he was still working despite the outbreak in order to support his family, although orders were much lower than before the health crisis. He received Rmb100 ($14.30) per day in pay plus Rmb7.5 per order, a wage that has not changed during the Chinese new year holiday period. Alibaba did not immediately respond to a request for comment.

 

The impact of the virus on the food delivery market has been mixed, with a likely fall in takeaway delivery and a strong rise in grocery deliveries...

 

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https://www.ft.com/content/6a116998-4ca9-11ea-95a0-43d18ec715f5