Aldi partners with Instacart for delivery service in US
German grocery chain Aldi said it has partnered with Instacart to deliver groceries in three US cities, a move that comes amid intense competition and disruption in the industry.
Aldi will launch a pilot starting at the end of this month in Los Angeles, Atlanta and Dallas with the potential of expanding to more cities in the future.
The German retailer does not offer customers an option to shop on its own website now and the partnership is a way to test online grocery demand, Aldi's vice-president of corporate buying Scott Patton said.
"Grocery shopping online is a relatively small part of the business but it is continuing to grow," Patton said.
A report from the Food Marketing Institute and market research firm Nielsen in January this year estimated online grocery spending during 2016-2025 would grow from 4.3pc of the total US food and beverage sales to as much as 20pc, or more than $100bn. Last year, online grocery sales were about $20.5bn. Aldi's move also comes at a time when grocery chains in the country are caught in a price war. German rival Lidl has started opening stores in the country and online retailer Amazon.com said in June it will acquire grocery chain Whole Foods Market. To better position itself, Aldi said in June it would invest $3.4bn to expand its US store base from more than 1,600 now currently to 2,500 by 2022.
The partnership with Instacart will allow shoppers to order goods from Aldi stores using Instacart's website and app. Instacart does not hold inventory but picks up orders from the store and brings them to a customer's home in as little as one hour for a fee. US retailers Target, Whole Foods Market and Costco already work with Instacart. (Reuters)