Pizza, burger - and maybe a few more flowers?

The delivery of food, groceries and everyday goods has been a dominant economic trend since the beginning of the new century.

The Dax group Delivery Hero from Berlin is doing well in global competition with a number of delivery groups.

In his home market, which the group only re-entered in the spring, the challenges are great, as CEO Niklas Östberg admitted on Thursday.

Bastian Benrath

Editor in business.

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“Generally things are going very well,” said Östberg in an interview with the FAZ. “But we don't want to arouse the expectation that things will develop quickly.” In five years' time, business in Germany could make a positive contribution to group business as a whole. “But when we talk about becoming the leading German delivery service, then it's an operation that will take more than ten years.” For Delivery Hero, Germany is not a market that the company must win at any price: “We'll see , how it is going."

This is in contrast to the company's previous statements about the restart in Germany.

“We are very satisfied with the start in Berlin,” Delivery Heros Germany boss Artur Schreiber told FAZ in August.

You can feel a very high demand and good delivery times can be achieved.

The group operates on its home market under the pink “Foodpanda” brand and currently delivers in Berlin, Hamburg, Frankfurt and Munich.

Other large cities are to follow.

"Lieferando is very strong"

In Germany, as in other countries, Delivery Hero focuses on delivering food and groceries to customers with its own couriers. This differs from the business model of the German market leader Lieferando, which primarily arranges orders, but then lets restaurants deliver them themselves. "Lieferando is very strong," admitted Östberg now. You notice the 14 year lead that the service, which belongs to the Dutch company Just Eat Takeaway, has in Germany.

Lieferando started in this country in 2007. The irony of the story is that Delivery Hero sold its former German store under the “Foodora” brand to Just Eat Takeaway at the beginning of 2019.

Delivery Hero put the almost one billion euros that the group received for this into its expansion in Asia and the Middle East, two regions of the world in which the group is traditionally strong.

Results boost the share price

However, if you look at all 50 countries in which Delivery Hero operates in the world, things are going well for the Berliners. That is why they raised their annual targets a little on Thursday. It is expected that sales for the year as a whole will be at the upper end of the range of 6.4 to 6.7 billion euros. Last year, the proceeds were 2.8 billion euros - with a loss of 1.4 billion euros. Delivery Hero continues to write deep red figures, but does not mention the shortfall in the third quarter figures published on Thursday.

Analysts praised the quarterly results as "solid", the company's share price rose by around 3 percent in the morning. In the meantime, Delivery Hero is feeling that people are eating more frequently in restaurants again after the corona lockdowns. Growth flattened out from June to September. Although sales rose by 89 percent to 1.8 billion euros, the increase in the first half of the year was still 138 percent. The company has invested heavily in its “D-Marts” mini-warehouses, from which it delivers food locally in cities. It now operates more than 900 such locations, said Östberg. That makes you an international industry leader.

Östberg cautiously commented on the takeover of the Finnish delivery service Wolt by the American market leader DoorDash, which was announced on Wednesday.

Wolt delivers in seven German cities and is therefore one of the larger delivery services in this country.

DoorDash puts 7 billion dollars on the table for Wolt.

“We considered investing in Wolt, but that would not have made any sense to us,” said Östberg.

"The takeover now shows that DoorDash was prepared to pay too much for Wolt." Since last quarter, Delivery Hero has been greater in order volume (GMV) and sales than DoorDash and Wolt combined, said Östberg.

Nevertheless, the competitor will be treated with respect.