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Entertainment, Food & Beverage

Online grocery shopping on the rise

Consumers spent 200% more in first 8 months than in whole of 2010
The Straits Times - October 3, 2011
By: Jessica Lim
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Online grocery shopping on the rise Household.sg founder Reuben Lee (left) delivering an online grocery order to varsity student Sajeev Lim. -- ST PHOTO: TERRENCE LIM

SHOPPING for groceries online took off in a big way in the last year, although the service has been around for nearly a decade.

PayPal, which provides online payment services to virtual grocery stores here, reports that consumers here spent almost 200 per cent more in the first eight months of this year than they did in the whole of last year - with the year-end festive period surge still to come at that.

PayPal handles payments for household.sg, thebutcher.com.sg and supernature.com.sg, among other virtual retailers.

The convenience of shopping in the comfort of one's own home, and then having the items delivered, perhaps for an extra $7 to $12, is hard to top for Internet- savvy, time-strapped consumers.

Mrs Christine Leong, 43, an administrative assistant and mother of four, does her weekly grocery 'runs' on home-grown site household.sg before she goes to work, while sipping her coffee.

She goes online, clicks on the items she wants, 'checks out' and chooses a delivery slot. There is a delivery fee, but if she spends more than a certain amount, that might be waived; the fee is higher for smaller orders.

Items popularly bought by shoppers like her are essentials such as rice, milk powder and diapers, as well as heavy or bulky items like mineral water.

At household.sg, for instance, customers now spend an average of $80 at a go - twice what they spent scarcely six months ago, when the website was launched.

Delivery is free for orders above $40.

Demand at the online stores of supermarket chains like FairPrice, Cold Storage and Carrefour is also rising.

The number of customers at FairPrice's eight-year-old online store has grown by an average of 25 per cent year-on-year.

The chain, which charges $7 for transactions of above $60 and $10 for orders below that, has increased the variety of items in its online store to 4,000, up 30 per cent from last year.

At Cold Storage, which has similar charges, demand has risen by a double-digit percentage year-on-year since 2007.

Carrefour, which opened its online store only in August, has yet to start selling perishable items, but demand has surged all the same. Its customers, made up of a mix of locals and expatriates, spend about $200 a transaction.

Delivery is free if the bill exceeds $150.

Mr Gerry Lee, FairPrice's managing director of business groups, puts the increased demand down to the change in consumer purchasing habits. 'Shoppers now have busy lifestyles. Online shopping lets them buy their daily essentials from the comfort of their own homes.'

Going online also makes sense for businesses. Australian supermarket chain Coles, for example, trades the equivalent of five to six large brick-and-mortar stores through its online site, which incurs considerably less in overheads.

The booming market is attracting new entrants. Heartland chain Prime Supermarket is now testing its online website, due to be launched in a month; Sheng Siong has not ruled out the possibility of running a virtual outlet as well.

The founder of household.sg, Mr Reuben Lee, 23, started his business on the back of his memory of numerous 'repetitive and troublesome' trips to the supermarket with his mother.

He said: 'People are already very comfortable with shopping online. Right now, you can buy almost anything online. Why not groceries?'

The computer science student at the National University of Singapore stocks a warehouse with items bought from manufacturers and delivers them to customers with the help of three part-timers who do the deliveries, manage the stocks and programme the website.

Housewife and mother of five Glenda Frost, 52, started shopping online in January. She likes that she can compare prices across websites, and spends about $80 each time.

The native Texan uses Cold Storage's online store, relishing the thought of avoiding the crowds. 'Shopping online means I can take my time to figure out what I need,' she added.

For Mrs Leong, who does not own a car, the delivery service is a boon, especially when she buys heavy items such as drinks and detergents in bulk.

She said: 'The people at household.sg carry the groceries right into my kitchen, and delivery is free if I spend more than $40. It's a great service.'

 

 

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