Gopuff will now sell its own line of products, starting with bottled water

Gopuff, Philadelphia’s rapidly growing delivery start-up, has launched a line of private-label products such as snacks, batteries, and cleaning items.

The company unveiled Tuesday its Basically brand of essentials, which will be available on Gopuff’s platform, starting with bottled water. Other items, such as popcorn, cutlery, and paper products, will be rolled out in the coming months, company officials said.

The delivery start-up, founded by a pair of Drexel University students, has raised billions of dollars from investors and expanded across the United States and Europe. Based on North Third Street near Spring Garden Street, it now delivers beer, snacks, and toiletries in more than 1,000 cities.

Gopuff is raising $1.5 billion more that could value the company at as much as $40 billion, according to TechCrunch. The size and structure of the “Series X” investment round is a strong sign that Gopuff plans to go public, the tech news site reported.

The company has pitched itself to investors as the most viable “instant needs” provider, largely because it operates its own warehouses, Axios reported. By contrast, competitors including Instacart and DoorDash primarily deliver food and products from third-party grocery stores and restaurants.

Consumers have been snapping up private-label products during the pandemic, according to research from McKinsey & Co. In a September 2020 survey of more than 2,000 U.S. grocery shoppers, nearly one in five said they’ve bought more private-label products during the COVID-19 crisis than they did pre-pandemic. More than 45% said price was the primary reason. Another factor was the lack of well-known national brands on store shelves.

“The consumer shift toward private labels benefits retailers as well, since private labels are typically more profitable for them,” the McKinsey report said. “Furthermore, high-quality private labels can gain a devoted following and become a powerful driver of customer loyalty to the retailer.”

In addition to selling private-label products, Gopuff is now cooking its own food. In July, the firm launched “Gopuff Kitchen,” preparing fresh meals including pizza, chicken tenders, and mozzarella sticks. Gopuff’s new offerings are expected to improve profit margins, company officials said.

“After over eight years of delivering instant needs, we truly understand what our loyal customers look for in everyday essentials — insights that have enabled us to create product lines designed specifically for them,” Daniel Folkman, Gopuff’s senior vice president of business, said in a statement.

Gopuff officials said they used consumer trend data and surveys to develop products. With nuts, for example, Gopuff bypassed traditional big sellers such as roasted and salted. Instead, it has opted to sell flavors such as habanero BBQ almonds because of insight into what its customers prefer.