How Does Gorillas Make Money? The Gorillas Business Model In A Nutshell

Gorillas is a German online grocery delivery company. It was founded in 2020 by Kağan Sümer and Jörg Kattner to target an underserved section of the grocery market. Gorillas has two primary revenue generation strategies: product sales, and delivery fees.

Business Model Element	Analysis	Implications	Examples
Value Proposition	Gorillas’ value proposition includes: – Ultra-Fast Delivery: Providing grocery delivery within minutes. – Convenience: Offering a hassle-free and time-saving shopping experience. – Fresh and Quality Products: Ensuring the quality of groceries delivered. – Diverse Product Range: Offering a wide selection of grocery items. – Mobile App: Providing a dedicated app for easy ordering. Gorillas appeals to customers seeking quick and convenient grocery shopping with a focus on fresh and quality products.	Attracts customers looking for rapid grocery delivery. Enhances user satisfaction through convenience and a diverse product range. Builds trust with the promise of fresh and quality groceries. Encourages app usage for streamlined ordering. Offers a comprehensive value proposition for grocery shoppers.	– Ultra-fast grocery delivery within minutes. – A convenient and time-saving shopping experience. – Fresh and quality grocery products. – A wide selection of grocery items. – A dedicated mobile app for easy ordering.
Customer Segments	Gorillas serves the following customer segments: 1. Busy Urban Residents: Individuals looking for quick and convenient grocery shopping. 2. Professionals: Working individuals seeking time-saving solutions. 3. Tech-Savvy Consumers: Customers comfortable with mobile app-based services. 4. Students: Young adults and students in urban areas with limited time for shopping. Gorillas targets an urban demographic seeking fast and efficient grocery delivery services.	Attracts urban residents looking for quick grocery solutions. Provides time-saving options for professionals. Engages tech-savvy users comfortable with app-based services. Appeals to students and young adults with busy schedules. Targets a specific urban customer base for growth.	– Busy urban residents seeking convenience. – Working professionals in need of time-saving solutions. – Tech-savvy consumers comfortable with app-based services. – Students and young adults with limited shopping time.
Distribution Strategy	Gorillas’ distribution strategy includes: – Dark Stores: Operating small, localized warehouses for efficient order fulfillment. – Couriers: Employing a network of couriers for fast delivery. – Mobile App: Providing a mobile app for ordering and tracking deliveries. – Inventory Management: Optimizing inventory in dark stores based on demand. Gorillas ensures rapid delivery through strategically located dark stores, a courier network, and a user-friendly mobile app.	Operates dark stores to minimize delivery time and optimize inventory. Utilizes a network of couriers for swift order fulfillment. Offers a mobile app for easy ordering and tracking. Manages inventory efficiently based on demand patterns. Implements a distribution model designed for ultra-fast delivery.	– Operating small, localized warehouses (dark stores). – Employing a network of couriers for fast delivery. – Providing a mobile app for ordering and tracking. – Optimizing inventory in dark stores based on demand.
Revenue Streams	Gorillas generates revenue through the following streams: 1. Delivery Fees: Charging customers for each grocery delivery. 2. Product Markup: Marking up grocery prices to cover costs and generate profit. 3. Subscription Services: Offering premium subscriptions for delivery discounts. 4. Partnerships: Collaborating with brands and retailers for product promotions. Gorillas diversifies its income sources through delivery fees, product markup, subscriptions, and partnerships.	Earns revenue from delivery fees on each order. Generates income through marking up grocery prices. Offers subscription services for recurring revenue. Collaborates with brands and retailers for promotional income. Diversifies revenue streams for financial sustainability.	– Earnings from delivery fees on each order. – Marking up grocery prices to cover costs and generate profit. – Offering premium subscriptions for delivery discounts. – Collaborating with brands and retailers for product promotions.
Marketing Strategy	Gorillas’ marketing strategy involves: – Local Marketing: Promoting the service within specific neighborhoods. – Partnerships: Collaborating with local businesses and brands for marketing and promotions. – Referral Programs: Encouraging users to refer friends and earn rewards. – Social Media Presence: Utilizing social media for marketing and user engagement. Gorillas focuses on local marketing, partnerships, referrals, and social media to increase brand awareness and user acquisition.	Promotes the service within specific neighborhoods for local visibility. Collaborates with local businesses and brands for marketing. Encourages user growth through referral programs and rewards. Utilizes social media for marketing and engagement. Implements a multi-channel marketing approach for growth.	– Local marketing to promote the service in specific neighborhoods. – Collaborating with local businesses and brands for marketing. – Encouraging users to refer friends and earn rewards. – Utilizing social media channels for marketing and user engagement.
Organization Structure	Gorillas’ organizational structure includes: – Executive Leadership: Led by the CEO, responsible for strategic direction. – Dark Store Operations: Managing localized warehouses and inventory. – Courier Network: Employing couriers for order delivery. – Marketing and Partnerships: Engaging in marketing and brand collaborations. – Customer Support: Providing assistance and support to users. Gorillas maintains a structure aligned with core functions for efficient operations.	Led by an executive team responsible for strategic direction. Manages localized warehouses and inventory for efficient operations. Employs a courier network for rapid order fulfillment. Engages in marketing and brand collaborations for user growth. Provides dedicated customer support for user satisfaction. Maintains a well-structured organization.	– Led by an executive team responsible for strategic direction. – Manages localized warehouses and inventory for efficient operations. – Employs a courier network for rapid order fulfillment. – Engages in marketing and brand collaborations for user growth. – Provides dedicated customer support for user satisfaction. – Maintains a well-structured organization.
Competitive Advantage	Gorillas’ competitive advantage stems from: – Ultra-Fast Delivery: Offering grocery delivery within minutes. – Dark Stores: Operating localized warehouses for efficient order fulfillment. – Convenience: Providing a hassle-free and time-saving shopping experience. – Local Presence: Focusing on specific neighborhoods for a local touch. – Partnerships: Collaborating with local businesses and brands for promotions. Gorillas’ strengths in rapid delivery, dark stores, convenience, local presence, and partnerships position it as a competitive player in the on-demand grocery delivery space.	Distinguishes itself with ultra-fast grocery delivery within minutes. Ensures efficiency through localized dark stores for order fulfillment. Prioritizes convenience for a time-saving shopping experience. Builds a local presence within specific neighborhoods. Collaborates with local businesses and brands for promotional advantages. Enjoys a competitive edge in the on-demand grocery delivery industry.	– Offering ultra-fast grocery delivery within minutes. – Operating localized dark stores for efficient order fulfillment. – Providing convenience for a time-saving shopping experience. – Focusing on specific neighborhoods for a local touch. – Collaborating with local businesses and brands for promotions. – Maintaining a competitive edge in the on-demand grocery delivery industry.

Table of Contents

Histry of Gorillas

Gorillas is a German online grocery delivery company.

It was founded in 2020 by Kağan Sümer and Jörg Kattner to target an underserved section of the grocery market.

Sümer identified that consumers organized their grocery shopping around the supply chain needs of the supermarket, rather than the supermarket being organized around the purchasing needs of the consumer.

The result is that most consumers tend to make a weekly, bulk purchase of groceries. This tendency has resulted in an emphasis on long-life shelf products where even fresh food is made to last as long as possible.

Shopping habits based on supply chain needs are also detrimental to consumers who prefer to make smaller but more frequent purchases. Furthermore, the model is inconvenient for those who forget to purchase one or two items from a recipe.

To solve this problem, Sümer and Kattner asked themselves how a consumer might react to a company serving them with what they needed, when they needed it.

Ultimately, they hypothesized consumers would shift from purchasing groceries weekly to purchasing them as required.

With a small amount of seed funding, Sümer bought some groceries from a local supermarket and stored them in his flat.

When an order was received, he made deliveries on his bicycle in the local neighborhood to ensure customers did not have to wait.

Buoyed by initial success, the service was expanded to a district in Berlin housing 165,000 people. Rapid delivery times and late opening hours then increased word-of-mouth advertising.

The service is now available in every major German city and is beginning to expand into other areas of Europe. In March 2021, Gorillas became the fastest German start-up to reach unicorn status, with a valuation of over $1 billion.

Gorillas revenue generation

Gorillas has two primary revenue generation strategies.

Let’s take a look at both below.

Product sales

Gorillas is an operator of so-called dark stores, or retail and distribution centers catering exclusively for online eCommerce.

As a result, the company makes money when it sells an item for more than the cost of purchasing and then storing it.

Profits are also increased by the dark store model since Gorillas can better track when inventory is running low.

This helps them avoid unfulfilled orders and increases customer satisfaction.

Delivery times are also much shorter as warehouse staff are better able to coordinate with courier staff to process orders quickly.

Delivery fees

For the small fee of €1.80, the company claims it can deliver an order in just 10 minutes.

Delivery fees are so low because Gorillas controls most aspects of the grocery supply chain.

It should also be noted that these fees cover costs associated with delivery and do not make the company a profit.

Key takeaways:

Gorillas is a German online grocery delivery platform. It was founded by Kağan Sümer and Jörg Kattner in 2020 to give consumers fast and convenient access to on-demand grocery items.
Gorillas operate a network of dark stores, making money by purchasing grocery items and selling them for a profit. Revenue generation is maximized by efficient inventory management and coordination between distribution and courier staff.
Gorillas also charge a small delivery fee to deliver orders anywhere in around 10 minutes. The company does not make money on this fee per se, instead relying on the dark store model as the primary source of profits.

Key Highlights

Introduction to Gorillas:
- Founded in 2020 by Kağan Sümer and Jörg Kattner.
- Aimed to target an underserved section of the grocery market.
- Identified an issue where supermarkets were organized around supply chain needs rather than consumer purchasing needs.
Shopping Behavior and Solution:
- Consumers tended to make weekly bulk purchases due to supermarket supply chain organization.
- Sümer and Kattner hypothesized that consumers would prefer to purchase groceries as needed.
- Started with seed funding, Sümer stored groceries and made local deliveries on his bicycle to meet immediate needs.
Expansion and Success:
- Started in a local neighborhood in Berlin and expanded to cover a district with 165,000 people.
- Rapid delivery times and late opening hours led to word-of-mouth advertising.
- Expanded to major German cities and other parts of Europe.
- Achieved unicorn status with a valuation over $1 billion in March 2021.
Revenue Generation Strategies:
- Two primary revenue sources for Gorillas: product sales and delivery fees.
Product Sales:
- Operates dark stores (retail and distribution centers for online eCommerce).
- Earns profit by selling items for more than their cost of purchase and storage.
- Efficient inventory management in dark stores helps prevent unfulfilled orders and increases customer satisfaction.
Delivery Fees:
- Charges a small fee of €1.80 for 10-minute deliveries.
- Gorillas controls various aspects of the grocery supply chain to keep delivery fees low.
- Delivery fees cover costs associated with delivery, not intended for direct profit.