This month Coles announced a major new partnership with Uber Eats that will further expand the supermarket giant’s ties to the gig economy. Under the scheme, Uber Eats drivers will not only carry out home deliveries for the supermarket, but drivers will also collect and pack orders from supermarket shelves.
Previously, online orders were taken by Coles’ directly employed personal shoppers who handed over the order to a delivery partner. More than 500 Coles stores across the country will begin selling goods through the digital platform, with gig employees taking on the role of Coles personal shopper.
The deal differs from one existing partnership between Woolworths Metro60 and Uber Eatsforged in June 2022, which also promises fast delivery, albeit with orders fulfilled by supermarket employees.
The Coles partnership is a major development where Uber Eats drivers will work in the supermarket alongside traditional employees and customers.
The gig economy is making its appearance in the supermarket
The supermarket duopoly has been steadily recruiting gig workers for their home delivery services since Coles partnered with Airtasker in 2017. The demand for fast deliveries then increased during the pandemic years 2020 and 2021.
From one perspective, Coles and Woolworths are simply outsourcing specific tasks (such as picking, packing, and delivering) to Uber Eats and other gig-work platforms. The supermarkets belong to another absorbent gig workers in their own activities.
Read more: Coles and Woolworths move into robotic warehouses and on-demand labor as home delivery surges
Gig workers are not formal employees and do not enjoy the same legal protections as other workers, but they nevertheless perform work that is core grocery business.
The so-called “last mile” of the delivery – the last stretch between a hub such as a warehouse or supermarket and the consumer – is widely regarded as the most difficult and unprofitable part of logistics, especially for fast deliveries. While both supermarkets have their own last-mile systems for pre-booked deliveries, the partnership with Uber Eats allows them to offer customers fast home delivery options while eliminating the risk of the last mile.
There may be tens of thousands of jobs at stake
In 2022 I interviewed supermarket employees about the impact of fast delivery services. Many expressed concern that the gig economy was “getting closer”, with some predicting that the role of the personal shopper – a supermarket worker who would collect and pack items for delivery – would eventually be usurped by gig workers.
Coles says Uber Eats drivers “complement rather than compete” with existing directly employed supermarket employees.
Read more: ‘A weird ringing sound that everyone dreads’: what fast deliveries mean for supermarket workers
For now, gig workers and employees will work side by side. Over time, however, it is possible that other supermarket functions will be moved to the gig economy.
Coles and Woolworths are Australia’s largest private sector employers. As they bring the gig economy to their workplaces, it could impact tens of thousands of jobs.
Grocery is an industry where everyone wins everything
The new partnership was announced just days after grocery delivery start-up Milkrun officially folded.
Milkrun was the last of four Australian fast food delivery start-ups to launch in recent years. The company failed to turn a profit, quickly abandoned its central proposal of delivery within ten minutes, and burned by $86 million in venture capital in less than two years.
Read more: The demise of MilkRun is another nail in the 10-minute grocery delivery business model
With much less fanfare, both Coles and Woolworths have achieved what startups couldn’t. Their advantage was their enormous scale and market power, which allowed them to push suppliers for lower prices and leverage their existing networks of distribution centers, stores, delivery vans – and now gig economy partnerships.
In an unfair playing field, the supermarket giants have the best of both worlds: vertical integration with the supply chain And the ability to shift risk away from the company to individual gig workers.
Essential service or frivolous convenience?
The example of Milkrun and other startups suggests that on-demand grocery delivery may not be feasible without an army of insecure workers like Uber Eats drivers. This raises another question: have we or do we really want the groceries delivered so quickly?
The supermarkets often frame their new delivery services as an advantage”vulnerable Australians”, such as the elderly and people with disabilities. The implication is that the availability of fast grocery delivery is a social good, rather than simply a convenience.
However, if the service is really essential, it would seem that the people who do the work should be valued and supported with well-paid and secure jobs. Moreover, it is not entirely convincing that fast grocery delivery in its current form is essential at all.
Many personal shoppers I interviewed said that on-demand purchases were often frivolous. Referring to the partnership between Woolworths and Uber Eats, one employee recalled:
People order (…) a single banana and a Red Bull. It’s really weird what you get.
Another added:
No one used to do it before. Now people buy just five things and they pay that fee to have it delivered quickly. It’s more popular for alcohol or cigarettes or something like that.
A supermarket employee was very skeptical about fast delivery and stated:
It didn’t seem like it was about meeting shopper demands, which is made explicit by the item limit for Uber Eats. (…) You can only order 25 (items) so it was not about regular groceries. Really, I think it was just more for convenience. Instead of going to the store yourself, you can wait for it at home and someone else can sort it out for you.
The cost of this convenience will be borne by supermarket workers, who in recent years have already seen their work transform to fit the logic of the gig economy, with on-demand time constraints and ad-hoc scheduling. As the gig economy moves into the brick-and-mortar space, the distinction between conventional work and gig work is blurring further.
