Makro acquisition of SA startup WumDrop will shrink delivery time to three hours

Leading wholesaler Makro, part of JSE-listed company Massmart, today announced that it has acquired a majority stake in startup courier and delivery service WumDrop.

WumDrop co-founder Simon Hartley (pictured above) told Ventureburn in a phone call today that he could not discuss the details of the deal (including the date the deal was signed) — as doing so might affect the share trading price of Massmart.

“It was more money than I thought we could get. It was an indication of how serious Makro is,” said Hartley.

In an earlier press release, WumDrop claims the acquisition will improve the online shopping experience of Makro customers by cutting the delivery time for customers who are within 20km of a Makro store — from three days to just three hours.

Commenting in the press release, Makro supply chain director Dean Bauer described WumDrop’s tech as “extremely flexible and solid”, adding that it allows integration with any retailer big or small.

The acquisition has seen Makro roll out WumDrop’s solution (the startup was launched in 2014 by Simon Hartley and Roy Borole) to 16 stores in Cape Town, Durban, Johannesburg and Pretoria.

Hartley told Ventureburn that as a result of the deal, Wumdrop now completes five times more deliveries a month.

He added that as a result of the increase in the volume of deliveries, the logistics company now makes a profit on every delivery, a feat he said cannot be claimed by other delivery services.

As part of the acquisition, Makro has rolled out WumDrop to 16 stores in Cape Town, Durban, Johannesburg and Pretoria

“Our goal is to become the dominant last mile delivery service and this acquisition allows us to expand our business into areas we don’t usually service,” he said.

The benefits of this deal will likely filter down to WumDrop customers who include online retailer Zando, The Foshini Group, Bottles and Standard Bank.

The startup has in the past raised over R1-million in funding from angel investor Ernst Hertzog’s Action Heroes Ventures and the startup’s other investors, including Hans Spielthenner, Sara Lopes Moutinho, Justin Stanford, Rob Stokes, Wayne Gosling, Daniel Guasco and Vinny Lingham.

Read more: Ventureburn chats with Simon Hartley on WumDrop’s R1m-plus investment [Q&A]

Earlier this year the startup announced the launch of a service called Deliver 2 Me which through real-time location information from a user’s phone, allows one to choose a time and location for a delivery to take place.

Read more: WumDrop launches Deliver 2 Me, new address-free delivery option

Featured image: WumDrop co-founder Simon Hartley (Supplied)