Frisco.pl reported a 37% increase in sales in 2018 to reach PLN96.5m (US$25.6m). This continues the double-digit growth rates it has been reporting since 2015. The pure online retailer is set to grow at above the rate for the channel, which we estimate to be around 15% between 2019 and 2023.
Frisco.pl is far from profitability, but it is getting there
Sales performance is illustrating growth, but the online retailer has yet to report a profit. In 2017 it generated a PLN12.7m (US$3.4m) net loss but was an improvement on the PLN13.2m (US$3.5m) net loss it recorded in 2016.
Regardless of its lack of profit it is managing to increase revenue. Following our recent visit to the country we have identified five strategies it is employing to do so.
1- Competes against other channels in the main shop mission space
Frisco.pl is growing its shopper base by attracting main shop missions from other channels. It is doing this by offering greater convenience and targeted pricing. Shoppers can buy bulky items, plan and build their shopping baskets across several sessions. It offers a wide range to compete against hypermarkets, while in relation to price, it uses targeted marketing, generated from data from shoppers’ smartphones or tablets geolocation, which it uses to send them personalised promotions.
2- Flexes its delivery service coverage
Frisco.pl mostly delivers in the Warsaw area, but does offer a limited service to the rest of the country. Deliveries outside of Warsaw are restricted to business hours, during weekdays. Most of these deliveries are made up of business-to-business orders, usually for offices. The retailer is looking to expand this coverage, most likely to another major city, such as Krakow.
3- Drives sales on quality of fresh food
The pure online retailer uses a just-in-time model for their fresh food range, so it can offer assortments that compete on freshness, in addition to the quality of delivery. By attracting shoppers to its fresh category, it can convert them to buy their main shop mission through it too. It also drives sales by attracting shoppers to a category with targeted marketing and pricing, in collaboration with branded manufacturers.
4- Leverages shopper trends like healthy living
It added a page on its website to make it simpler for shoppers to buy and cook healthy food. In one example, it collaborated with celebrity fitness coach, Ewa Chodakowska, by linking shoppers to her website where they could plan their healthy diet meals. Other collaborations include Przepisy.pl where shoppers can select a meal and, with one click, add the relevant ingredients of that meal to their Frisco.pl shopping list.
Source: Frisco.pl, Przepisy.pl
5- Delivery payment benefits tied to purchase volume
Frisco Fruit is Frisco.pl’s benefits programme, which encourages shoppers to take advantage of lower delivery charges and better booking slots if they buy more. Shoppers are rewarded with points every time they complete an order, so for every PLN50 (US$13.30) above the minimum order they get 15 points. They can receive lower delivery charges or no charge at all, depending on the points, and additional products from a promotional basket.
Frisco.pl is preparing for further growth with new automated warehouse
The retailer opened a 11,000 sq. m. automated warehouse near Warsaw, in May 2019, that quadruples its capacity for more orders. It is designed to centralise control over the entire picking process and increase its efficiency. The unit is divided into several temperature and logistic zones and has a robot that can prepare up to 420 orders per hour. Also, boxes are transported on conveyor belts around the warehouse, which handles 80% of the intra-warehouse transport.
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