Delivery riders for the soon-to-be defunct grocery delivery service MilkRun have opened up on the company’s desperate efforts to stay afloat in the lead-up to its closure.
CEO and founder of MilkRun, Dany Milham, wrote to the company’s approximately 400 staff on Tuesday notifying them that the business will shut its doors this Friday, making it the latest in a long line of home delivery firms to go under.
To many of its workers, the decision to shut down the business was not a shock after they claimed to have witnessed desperate attempts to keep the company afloat as it tried to maintain high standards – but ended up cutting costs, wasting food and blowing out delivery times.
Two delivery riders for MilkRun, both who wished to remain anonymous, revealed to Daily Mail Australia what it was like working for the business that promised home delivery of groceries in 10 minutes.
‘The message from management was “we’re doing okay”, but on Tuesday we get the email saying “we’re closing on Friday, get another job’,” delivery rider Jake (not his real name) said.
MilkRun riders have revealed that the company tried desperately to strike a fine line between cost cutting measures and customer satisfaction in the lead-up to its closure on Friday
In the email to staff, Mr Milham blamed deteriorating economic and capital conditions following a company restructure in February.
‘When the email first got to me I kind of laughed at it, honestly, because I thought “oh, this came sooner than I expected”, but I was by no means shocked,’ Dee (not his real name) told Daily Mail Australia.
The restructure lead to the redundancy of about 20 per cent of MilkRun’s staff and the dissolution of the ‘senior rider’ job title that played an important mediation role between management and riders.
‘They were angry, pissed even – some of them relied only on MilkRun as their only earnings,’ Jake said of riders’ reaction to the restructure.
‘They were told to either move down from their role or leave all together.’
Jake and Dee both worked for separate MilkRun ‘hubs’ in Sydney’s inner-city, enticed by the company’s policy of making them employees rather than contractors.
In contrast with many delivery companies, MilkRun hired staff on either full-time, part-time or casual contracts to provide secure work.
‘At other places you’re your own boss, at MilkRun you’re not a boss, you’re an employee of someone,’ Jake said.
Delivery riders become ‘sceptical’ of the business after a restructure in February lead to well-respected senior riders becoming part of the 20 per cent of staff made redundant
The restructure also closed numerous ‘hubs’ where orders were packaged, expanding the distance that riders had to cover to deliver orders and blowing out delivery times.
Dee had become quite sceptical and less susceptible to ‘blindly following and believing’ MilkRun’s business model following the February restructure.
‘They said they had about a year’s worth of runway but closed this early,’ he said.
‘Everyone I worked with was under pressure to make sure the customer was getting the order on time,’ Jake said about the post-February changes to the business.
‘We were just trying to make it the best for the customer but how were you able to do that? It’s impossible.
‘Customers were expecting the order to get there in 10 minutes but there was no notification to customers that it could be up to 30 minutes.
‘You could also be picking up a bunch of orders, but before you were just picking up one.’
One of the selling points of MilkRun’s model was being able to get groceries to customers within 10 minutes, but after the February restructure this stretched to half an hour or longer.
While Jake and others he worked with felt pressure to step up in more pressing circumstances, Dee and the team around him felt quite the opposite.
‘We kind of prefer doing the longer rides… it means that there was less times you were on and off your bike, it was more peaceful I guess,’ Dee said.
‘I understand there’s some people that wouldn’t want to be riding for longer periods of time though.’
Two delivery riders, Jake and Dee (not their names), both saw pallets of food that was before its expiry date being thrown out or taken by staff for ‘aesthetic’ reasons (pictured: unusable bread at a hub in Sydney City)
Both Dee and Jake witnessed the company trying to strike a fine line between cost cutting measures and customer satisfaction.
‘The fact people don’t get to pick their own stuff, it sort of allows them to be quite nit-picky about it, which can be annoying,’ Dee said.
‘They definitely put in a lot of effort to give people the best (produce) that they could, we had to get rid of stock they deemed was unusable or going to go out of date within three days.
‘Some of the big ones were bananas and avocados – if the banana even had a tiny little brown spot on the outside of the skin the decision was “this isn’t good enough for customers”.
‘I suppose it was an aesthetic decision, but I think it was kind of valid, because I think we’ve had a few complaints in the past of products not being perfect.
‘The food would either be given to staff to take home or chucked out.
‘I didn’t have to do a month’s worth of shopping for meat because we had so much food stored in the freezer,’ Jake said.
‘We were promising the customers that the food was fresh, and it was, but if food looked damaged it wouldn’t go in.’
Furthermore, if the customer was unhappy with the quality of the food, an identical order had to be sent to them with none of the original delivery being able to be returned.
‘We’d have to re-deliver orders and if it wasn’t up to the customer’s satisfaction, they got to keep both products because we couldn’t take a product back as it’s impossible to know whether it’s been tampered with,’ Dee said.
‘We never really knew if customers were trying to get free food by just complaining but management would have to listen to the customer either way.’
With experienced riders axed and hubs closed, delivery times blew out for customers from the original promise of 10 minute to upwards of half an hour
To help cut down delivery times, MilkRun recently introduced delivery staff who could complete orders on mopeds or in cars, expanding from the company’s e-bike-riding workforce.
According to Jake, the company had also been hiring new staff who could drive either vehicles for the past couple months and even as late as last week.
‘I was doing my last delivery when I saw one of the drivers and she started with them a couple months ago and that was her only job, and now she’s scrambling for another job,’ he said.
‘She was driving a van for them.’
The company had also changed how riders were assigned deliveries during the restructure.
‘Before February, all orders were given to riders by senior riders, but they were made redundant,’ Dee said.
‘After that we’d assign ourselves orders, but then this past month we would get assigned orders by someone at MilkRun HQ’s central dispatch.’
Many riders could end up taking up to five separate orders on a single outing, with delivery times for customers at the end of a string of deliveries stretching up to an hour.
Company founder Dany Milham (pictured, right) sent an email to its 400 workers on Tuesday informing them they would receive economic and emotional support through the closure process
Jake and Dee have both spent the past two days looking into new lines of work after hearing the news.
‘I was lucky to walk by a Domino’s and see they’re hiring delivery riders,’ Jake said.
‘I told them I worked for MilkRun and they’re speeding up the process to get me a job.’
MilkRun are also providing economic and emotional support to staff that were made redundant on Tuesday.
‘I want to assure you all that as part of this process, everybody will receive their full statutory entitlements, as well as additional ex gratia payments and ongoing support, including counselling and redeployment services,’ Mr Milham’s email reads.
The payment is rumoured to be about four weeks pay in lieu of a notice period, an extra $10 per hour for shifts following Tuesday’s announcement and a $750 ex gratia payment.
‘We’ve always been committed to doing things the right way, and winding down the business while we still have a sufficient cash balance enables us to ensure our people and suppliers are paid in full,’ Mr Milham continued.
The company’s coverage stretched across 50 suburbs in Sydney’s CBD, inner-west, eastern suburbs and just north of the Harbour Bridge.
It also covered 26 suburbs in Melbourne’s CBD, inner-north and south.
Daily Mail Australia have approached MilkRun for comment.
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