DPD Ireland has tapped into a healthy appetite for online grocery shopping with the launch of a food delivery service following a €13 million capacity expansion.
The launch of the DPD Food service last month follows expansion of the company’s logistics facility in Athlone to create the capabilities for storage of temperature-controlled goods.
DPD’s warehouse now provides over 5,000 pallet spaces and includes two additional units’ space for frozen and chilled products, while all products are batch managed through the warehouse management system.
In January this year, (former) Irish premier Enda Kenny officially opened the company’s expanded sortation facility in Athlone after a €13 million investment. The facility doubled in size from 50,000 to 100,000 sq ft, enabling the company to triple its daily parcel handling capacity from 50,000 to 150,000.
DPD Ireland is spending €500,000 on the expansion into the food delivery business, including the chilled and frozen storage at the newly expanded facility in Athlone. With the logistics facility located directly next door to the parcel sortation hub, orders picked and packed today are transferred immediately into the distribution network for delivery on the next working day across the country.
DPD’s systems connect directly with shippers’ order management software and allow all deliveries to be tracked.
DPD has signed up two health food specialists, Pow-Cow.com and Amazonia.organic, as launch customers for the new service. Pow-Cow makes frozen yoghurt from Irish milk, while Amazonia offers organic and fair-trade food from South America.
Gavin Warwick, DPD Ireland’s General Manager Logistics, said: “Food logistics and delivery in Ireland has enormous potential.”
He explained that the main challenge facing suppliers is ensuring delivery within strict time limits to ensure freshness and quality, and he pointed out that the company’s system provides consumers with the exact hour of delivery and offers them the choice of having their food delivered to a neighbour or safe place if necessary.
According to State food marketing agency Bord Bia, online grocery shopping in the Republic of Ireland is worth €170 million a year. DPD believes that this indicates that the market is still relatively underdeveloped as it represents just 1.2% of overall sales. The figure is expected to hit 4.5% by 2021.
Overall e-commerce is growing steadily in the country. A recent Institute of Grocery Distribution report predicted that online sales would increase by 68 per cent between 2016 and 2021.
According to DPDgroup’s 2016 e-shopper barometer study, Ireland has a medium level of Internet penetration (81%) vs. the other Western countries, but nearly two thirds of internet users regularly buy online (51% overall, 63% of Irish Internet users). Grocery is in the Top 10 of the types of goods purchased online.
DPD Ireland, with nearly 1,000 staff at 38 depots across the country, expects to increase revenues from €70.8m in 2016 to over €75m this year and to handle more than 16 million parcels.
