Two Czech online grocers are taking on Europe’s biggest supermarkets to feed growing appetite for home grocery delivery.
Founder and Chief Executive Tomáš Čupr said Rohlik Group was focused on turning a profit in Europe’s biggest economy after postponing plans to expand in Italy, Spain, and other markets as inflation and the Ukraine war cloud the economic outlook.
“We will go much deeper in Germany than wider in markets we wanted to a year ago,” said Tomáš Čupr, adding the company has contracted sites for fulfillment centers in Cologne, Essen, Berlin, and Düsseldorf, where it plans to launch. “Europe is a 1 trillion euros in grocery sales market. You are looking at a blue ocean.”
Last June, Rohlik raised 220 million euros in a Series D financing round led by Belgian investor Sofina, putting the firm’s valuation above a 2021 round that had made it a rare “unicorn” among start-ups with a valuation of 1 billion euros.
Rohlik.cz and rival Košík.cz, backed by Czech billionaire Daniel Kretinsky, are both seeking to apply models that have been successful at home. Although small in size, the Czech grocery delivery sector has developed faster than others in a fragmented European market that is expected to grow to $121 billion over the next four years from a current $73 billion, according to Statista.
“The online grocery market opportunity is a clear no-brainer but the key question is whether companies should focus on being a clear leader in one market or focus on more,” said Ingmar Wegel, a director at investment bank Clipperton in Germany.
“Competition is still mainly driven by stationary retail but a small number of online grocery players are gearing up in each market to become leading e-grocery platforms.”