The Milkman Principle

Placing the food order comfortably from the sofa in the evening,  receiving the delivery at the front door the next day: This is how the online food delivery service Picnic works.

The online delivery service Picnic is based on the milkman principle. Photo: Picnic

Wednesday evening, 8 p.m.: Claudia S. from Krefeld sits on her couch and pulls out her smartphone to do her weekly shopping. She is delighted that stress shopping at the end of the day has come to an end. Instead, she can now order from the food delivery service Picnic by app in the evening and receive her delivery at the desired time on the following day.

More and more people like Claudia S. are using online delivery services to buy their groceries. Various supermarket chains such as Rewe and Real or online mail order companies such as Amazon now offer this service – including Picnic. The Dutch tech start-up has been offering its delivery service since 2015. “We have seen how well Picnic has been received in the Netherlands. In Germany, we started with a pilot under an alias at the end of 2017. We wanted to get a feel for the expectations first,” reports Frederic Knaudt, co-founder of Picnic in Germany. In March 2018, the company officially started in Germany.

How it works

“The delivery service is based on the milkman principle,” explains Knaudt. Orders are placed exclusively by App. If the customer’s order is received before 10 p.m., Picnic delivers the next day. The minimum order value is 25 Euros, delivery is free. According to the company, Picnic is the only online food delivery service in Germany that supplies its customers free of charge. According to Knaudt, this works with the help of a very efficient supply chain. “The milkman model is the most efficient delivery model on the last mile. It comes into my street once a day and not several times as with other delivery services. This enables us to deliver three times more per hour,” says Knaudt. This saves Picnic a third of the costs. In addition, the start-up does not operate any shops, unlike the stationary trade. “What we save at this point we put into the delivery,” emphasizes Frederic Knaudt.

During her virtual shopping Claudia S. can now choose between around 10,000 products in the app. A few weeks ago, she had unfortunately not been able to buy a product via the app and contacted Picnic’s customer service. Now she is pleased to discover that the item is now available in the app and adds it to her shopping cart. The majority of Picnic’s products come from Edeka Rhein Ruhr. “This allows us to make sure that all the well-known brands as well as our own brands can be found in our assortment,” says Knaudt. Bakery products and fresh meat are also available. Picnic works with regional bakers and butchers to do this. The delivery process at Picnic starts in one of the warehouses. The wholesale goods arrive early in the morning. The so-called shoppers pick the food and pack it into crates that are loaded onto trolleys. From the warehouse, Picnic transports the trolleys to the intended lift. There, the drivers, the so-called runners, are already waiting to load their Goupil electric cars with the trolleys assigned to them. Picnic operates around 100 of these cars in Germany.

Around 3,000 customers are on the waiting list in Krefeld

The special feature: Picnic had the body of the electric delivery van designed in such a way that the trolleys fit exactly into the vehicles. The loading of the cars is done via a lifting platform without any major effort. That’s why the job as a runner is also very popular with women. “Around 30 percent of the approximate 250 runners in Germany are women,” says Knaudt. Picnic currently supplies six cities in Germany: Neuss, Kaarst, Meerbusch, Düsseldorf-Oberkassel, Mönchengladbach, Krefeld and Viersen. Delivery takes place in three time windows, also known as slots. The approximately 24,000 customers in Germany can choose one of these slots when ordering and receive a 20-minute window from Picnic during which delivery takes place. The Picnic app also offers a live radar for tracking the delivery. “In Krefeld there are currently 250 deliveries per day,” reports Knaudt. And the trend is rising.

Around 30 percent of the approximate 250 runners in Germany are women. Photo: Picnic

Claudia’s delivery arrives promptly on Thursday afternoon. The runner rings at 4.40 pm. “Once again super punctual”, thinks Claudia, who has watched the live radar in the app, and opens the door for him. He comes up the stairs heavily loaded. “I’d be happy to carry it to the kitchen for you,” he says. There is great interest in Picnic’s delivery service. Not everyone has automatic access to the app. Around 3,000 customers are on the waiting list in Krefeld alone. “Following the opening of the hub in Viersen, we are now concentrating on North Rhine-Westphalia,” explains Knaudt. “With Krefeld and Viersen, we have already opened two new hubs this year. At the end of the year, however, we will step on the gas again,” he reveals.

Claudia’s girlfriend Mareike lives not far from Krefeld and is jealous because the picnic delivery service does not yet exist for her place of residence. Maybe by the end of the year. In any case, Claudia is enthusiastic and is already looking forward to her next week’s shopping on the couch.