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The concert economy is one of Silicon Valley’s biggest tricks of the last decade. Armed with a smartphone, car, bag, bicycle, workers can register and register – to carry passengers, to do housework, to sit with pets, to deliver groceries. Companies, including Uber, Lyft and DoorDash, praise the model’s flexibility for shift workers. It also allows companies to neatly avoid paying for the benefits that traditionally come with employment in the United States: health care, paid leave, and worker compensation. Last year, the companies funded a successful voting initiative in California that enshrined the principles of the concert economy in law. Similar efforts are underway in Massachusetts, Illinois and New York.
But a new kind of business that rose with capitalist fury in U.S. cities this fall, including New York and Chicago, has removed that book. Many start-up companies for “immediate delivery” – Jokr, Buyk, 1520, Fridge No More, Gorillas, Getir – promise extremely fast products in the style of a convenient store directly to the doors of city dwellers. Companies say orders will arrive 30, 20, 15 or even 10 minutes after customers click the Buy button in their apps. And the couriers who make deliveries, mostly of electric bicycles, are not workers or contractors – they are employees.
“It would be very difficult for us to guarantee a 10-minute food delivery if we didn’t have employees,” said Adam Watzenske, head of US operations at Gorillas. At 18 months old and armed with more than $ 1 billion in funding, the German startup is a great veteran of the instant delivery space. Gorillas employees receive health benefits and paid leave, and most are full-time, he said. The company says couriers receive the equipment they need – including electronic bicycles, reflective vests and rain gear – for free.
These startups typically rent small storefronts in dense urban areas and store each mini-warehouse with between 1,000 and 2,500 products – another departure from companies like DoorDash, UberEats, Instacart and Shipt, which tend to operate virtually. Inside storefronts, workers, as well as employees, have items for availability, selection and bags to fulfill orders, which are usually smaller than the typical weekly or biweekly groceries. Couriers are available to transport them to their destination. Both DoorDash and GoPuff, another supply company, operate similar warehouses for convenience items, but only hire warehouse workers, with suppliers still working as independent contractors.
The companies have benefited from increased funding for the food and beverage business, which has raised $ 16 billion in 2021 so far, according to CB Insights. The money allows some companies to subsidize food supplies so that they are cheaper than what the customer can pay at the store, said Jackie Tubbs, an analyst at CB Insights who studies the industry.
Jordan Burke, founder of Tomorrow Retail Consulting, who previously managed e-commerce operations in China for Walmart, says companies are shifting travel to shops, gas stations and small supermarkets. They are built on the theory that when it comes to delivery, there is no such thing as being too fast. They grew rapidly during the pandemic, when some people tried to avoid leaving their homes. Berke expects many of these customers to stick. “What we see is that immediate access to the things we need is an experience that never goes back,” he says.
Not all employees are satisfied. In Berlin, Gorillas workers complain about lack of pay and claim that the company’s jackets and raincoats do not protect them enough from the weather. Some German Gorillas workers who took part in wild cat strikes – not allowed by unions and unprotected by law – were reportedly fired after shutting down several warehouses. The confrontation has made workers and labor experts wonder if the new model is just a concert work dressed in new clothes. “We are proud to ensure that the experience of our employees in the warehouse, at our corporate headquarters and for our riders comes first,” says Wacenske.
In the United States, workers at New York-based Buyk have complained in online forums about wage arrears, with some saying they have left as a result. “Most payroll issues have been resolved,” said CEO James Walker. “I can’t say as a start-up company and one that is growing very fast that we don’t have these growth problems.
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