Rapid delivery startup Weezy has shuttered almost a quarter of its dark stores amid fierce competition in the burgeoning sector, The Grocer understands.
Five of Weezy’s 22 dark stores in the UK have ceased operations, while two distribution hubs have been consolidated into a single site.
The stores that closed – including several in London – were not handling enough orders to be financially feasible when marketing spend in the areas they served was accounted for, said a Weezy source.
The source added that consolidation of distribution sites was to reduce labour hours and costs.
Over the past two months, The Grocer also understands several senior staff have left Weezy, including its legal director, finance director and director of people and talent, as have several workers in its dark stores.
A number of suppliers also told The Grocer demand for their products at Weezy had fallen in recent months.
Weezy launched in August last year, following a £1m pre-seed fundraise, and was an early pioneer of the rapid delivery market. In January it raised £15m in Series A funding to expand its grocery delivery service across London and the UK, vowing to run 44 dark stores by the end of this year. Backers included venture capital funds Left Lane Capital, Heartcore Capital and DN Capital, and angel investors including Groupon founder Chris Muhr, former Ocado head of retail Jon Rudoe, and Onefinestay co-founder Greg Marsh, an early backer of Deliveroo.
But Weezy is under pressure from competitors including international players Getir, Gopuff and Gorillas, which have launched in the UK since January.
The Grocer understands an approach by Weezy was made to US rapid grocery player Gopuff concerning a sale. Gopuff, having raised an additional $1bn in the summer, launched in the UK this month after acquiring Dija and Fancy earlier in the year.
Gopuff, however, was not interested in Weezy.
“Right now we’re focused on organic growth,” Gopuff co-founder and co-CEO Yakir Gola told The Grocer last month. “There might be some other deals, if something makes sense for us.”
According to Bloomberg, Weezy has been consulting with investment bank Evercore to explore the potential sale of the business.
Weezy responded “no comment” to all points raised in this story.
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