A Mexico City-based delivery-only grocery store chain has raised an additional US $12 million in financing as it seeks to expand its services across the country and beyond.
Jüsto has now raised more than $20 million in financing in less than a year, reported the technology news website TechCrunch.
The company, which sells a range of domestic and international products including fresh produce, beverages, household items, dry goods and pet supplies, is betting that demand for home-delivery groceries will grow as a result of the coronavirus pandemic.
A recent study by market research firm Nielsen found that 11% of respondents purchased groceries online for the first time in 2020 and 70% of those polled said that they planned to continue buying fresh food online.
Ricardo Weder, Jüsto’s founder and CEO, said in a statement that the e-commerce adoption curve is “dramatically accelerating” as a result of the pandemic yet the market penetration rate of e-grocers is still less than 1% in Latin America.
“That means there’s an enormous opportunity – and all the right conditions — to disrupt the grocery industry …” said Weder, a former president and CEO of Cabify, a ride-hailing service.
Even before the coronavirus pandemic, a partner at Foundation Capital, a United States-based venture capital firm that has invested in Jüsto, said he saw great potential in the company’s business model.
“We’ve seen that type of model, … D2C [direct to consumer] for groceries, be very successful” in other areas, Rodolfo González said late last year.
Manolo Fernández, a spokesman for Jüsto and member of the company’s founding team, said the grocery chain has the capacity to supply fresher producer to consumers than that which they find at bricks and mortar supermarkets.
“At traditional supermarkets the fill rates are lower and the product is less fresh. One of our core tenets is to reduce waste. We don’t have fruits and vegetables sitting outside in the store,” he said.
Jüsto claims that its prices are roughly the same as those of regular supermarkets and delivery is free for orders above 1,000 pesos (US $44). Consumers can choose express, same-day or next-day delivery.
According to the Jüsto website, the company currently delivers to neighborhoods across Mexico City and part of México state.
But with extra financing now available, the e-grocer has plans to expand nationally and abroad.
“We have the technology, talent and infrastructure to scale our expansion to more cities in Mexico and to begin our international expansion, beginning with Colombia,” Weder said.
Source: TechCrunch (en)