Uber is trialing a parcel delivery service for businesses, as demand for rideshare dwindles

Sharon Masige
  • Uber has launched a delivery service for businesses, beginning in Melbourne.
  • The service is available on the Uber for Business platform, allowing users to transport goods such as documents, groceries and parcels.
  • Uber said it was designed to help businesses complete last mile delivery amid soaring e-commerce delivery demand.
  • Visit Business Insider Australia’s homepage for more stories.

Uber is piloting a new delivery service for businesses in Melbourne as demand for e-commerce products grows – and the need for ridesharing falls – during the coronavirus.

The service is available on the Uber for Business platform, letting users get same-day or scheduled deliveries of items like groceries, documents and packages.

"What we've seen is that Australian businesses are facing fairly extraordinary circumstances and unprecedented demand for e-commerce platforms and more particular delivery of goods," Dom Taylor, the general manager for Uber Australia and New Zealand, told Business Insider Australia. "So what we've seen is that there's an opportunity for Uber to be part of the solution to help support Australian businesses during these really tough times."

The option is available for both business-to-business and business-to-consumer deliveries. Once established in Melbourne, Uber plans to roll it out across other major cities after the Easter break as businesses face more pressure on their traditional delivery networks.

Through the platform, businesses will be able to book pickups, manage multiple deliveries in real-time, request immediate pickups for urgent delivery, and track their items.

It comes as usage of Uber’s ride-sharing platform has declined globally amid the coronavirus pandemic.

While Uber didn’t provide specific numbers for Australia., its CEO Dara Khosrowshahi said gross bookings in Seattle are down by 60-70%, with the city significantly impacted by the coronavirus, according to the Verge. The company also assumed similar booking reductions in other places like Los Angeles, San Francisco and New York City. On top of this, Khosrowshahi mentioned a 45% decline in ridesharing in Hong Kong from peak levels.

In adding the service Uber joins fellow rideshare company Ola and taxi company 13cabs in diversifying into the delivery business. 13cabs launched 13things for customers to deliver parcels, while Ola recently announced its contactless delivery option for goods, alcohol and parcels.

There are items Uber's delivery service won't allow

Taylor explained that the platform won't allow the transport of items like alcohol, tobacco, prescription drugs, money or fireworks, so don't go getting any ideas.

Nonetheless, it wants to build on what it is able to transport by looking at which companies are experiencing the most demand for their products and which supply chains are under the most stress.

"Where Uber's going to play the biggest role is where there's a distributed network of retail stores that needs to move the goods that last mile to people," Taylor said. "And essentially what the store could be doing is booking a trip for a driver to come pick up from the store and deliver it to the customer's house or apartment or workplace."

The service is also available for businesses with employees working from home, allowing them to transport office supplies items like chairs or laptops.

The delivery service will be as "contactless as possible"

The new delivery platform will have a lot of the same contactless measures as Uber Eats.

"That's essentially leaving the good at the front door," Taylor said. "And also working with our business partners in ensuring that the pickup experience at the store is as close to contactless as possible."

For drivers, the delivery platform is an 'opt-in' option. "This is a way for us to help out our driver-partners that are online and active now get additional earnings opportunities," Taylor said.

"As we build up the size of the product then we'll start expanding, working out how we incorporate new drivers and then things like Uber Eats couriers and whatnot down the track."

And when it comes to the price, this Uber service includes an upfront cost, rather than using the price model that exists with normal ridesharing.

"We just didn't think it was a good reflection of the various factors at play here," Taylor said, regarding existing price models. "The pricing formula that we've adapted – while similar to Uber X in terms of cost – has different components. It's essentially a larger upfront cost to compensate the driver-partner for the pickup and the drop off experience.

"And then the charge will be based on the kilometres between the store pickup and the recipient's address. It won't have a time component to it."

READ MORE:

13cabs is launching a new delivery service, turning cabbies into delivery drivers during the coronavirus crisis

Ola has launched a contactless parcel delivery service in Australia to send goods and alcohol across cities