Whole Foods to Officially Exit Instacart Marketplace

Whole Foods

Whole Foods

Back in 2014, the organic grocery store Whole Foods partnered with Instacart to offer customers grocery delivery.

When the grocery chain was acquired about a year ago by the tech and logistics giant Amazon, it was only a matter of time until the grocery chain was going to exit the partnership.

Whole Food deliveries will no longer be available on the Instacart app starting February 10.

According to a recent “Tech Crunch” report, Amazon, which has its own grocery service Amazon Fresh, has negotiated to end the partnership with Instacart earlier than the company expected.

“A person familiar with the matter told TechCrunch that significant developments over the last 18 months forced Instacart to wind down its relationship earlier than planned. Whole Foods didn’t immediately respond to a request for comment,” writes “Tech Crunch.”

Instacart currently employs 70,000 people to shop and delivery grocery items for its customers. The service has grown wildly popular and has over 300 retailers on its marketplace including big-box retailers like Walmart and Kroger.

Its success has made it especially attractive to investors.

“The company raised $600 million at a $7.6 billion valuation in October, just six months after it brought in a $150 million round and roughly eight months after a $200 million financing that valued the business at $4.2 billion,” writes “Tech Crunch.”

However, this announcement means there will be layoffs. Instacart has said that 75 percent of 1,415 workers impacted have been given new roles. But there are 350 or so expected layoffs.

In a blog post, Apoorva Mehta, Instacart’s co-founder and CEO said that company is offering transfer bonuses to their Whole Foods shopping couriers and those that are being layoff will be given a separation package.

“We’re committed to taking care of all impacted in-store Whole Foods shoppers who choose not to, or cannot, be placed in a new role. For those shoppers, we’ll be providing a minimum of 3-months separation package based on your maximum monthly pay in 2018, as well as additional tenure-based compensation,” writes Mehta.

Do you think this is a fatal blow to Instacart? Will Amazon Fresh ultimately conquer the grocery delivery market? Or will consumers be more interested in using a service with many retail partners to choose from?

Read more about Instacart and Whole Foods parting ways at “Tech Crunch” now.

Amazon’s announcement to acquire Whole Foods rocked the food industry. Besides getting into the organic grocery market, Amazon has started to roll out Amazon Go stores. These convenience stores cater to the on-the-go consumer and are cashier-less. Many of which offer grab-and-go food options. These stores have become the most popular during the workweek, especially at lunchtime.

On this recent episode of The Barron Report, Host Paul Barron discusses how these stores are a threat to restaurants, especially fast casual.

Have Amazon Go and UberEats Become a Threat to Restaurant Operators?

Operators have always had to compete in the market with other concepts, but in today's market, there are a new set of power players ready to steal your customers.

Enter Amazon.

Amazon, like the fast casual segment, is catering to the on-the-go consumer with its cashier-less Amazon Go stores, many of which offer grab-and-go food options. These stores have become the most popular during the workweek, especially at lunchtime.

We recently analyzed the aggressive move Amazon is making in the foodservice industry. Listen to this episode of The Barron Report for more insights on if fast casual restaurants can survive this threat.

But there is one advantage that restaurants, namely fast casual restaurants, have over the Amazon Go stores– many have embraced the plant-based movement. According to Foodable Labs data, today's foodies can't get enough of these plant-based menu items.

Don’t miss our video breaking down this data about the plant-based movement below.

Amazon isn't the only threat operators need to be worried about. There is another shark circling to take a bite out of your business.

Third-party delivery services emerged as a solution that many operators desperately needed.

Since offering delivery has quickly become a guests' expectation, an operator has two options. One is to invest in significant funding to build a delivery program. However, this is easier said than done. It entails creating a system, investing in a platform to process these orders, hiring more staff to handle take-out and delivery orders, and then hiring reliable drivers to deliver these orders.

Or an operator can simply partner with a third-party delivery service, which eliminates most of the headaches. When you consider the operational and logistical challenges of offering delivery, its no wonder that operators across the country have decided to go the route of partnering with a third-party delivery service.

But now this has created a new problem.

One of the most popular delivery services out there is now UberEats. This company has quickly conquered the market. UberEats is currently offering food delivery for 50 percent of the U.S. population and has the lofty goal of serving 70 percent of the U.S. population by the end of this year.

As UberEats becomes more popular, the more the fees increase for the participating restaurants. Could this be correlated to the increase in restaurant closings?

Listen to the podcast above as The Barron Report host Paul Barron explains the data showing that third-party delivery growth may be tied to restaurant failures.

Food Delivery Discount Service Increases Sales During Restaurant Off-Peak Hours

Food Delivery Discount Service Increases Sales During Restaurant Off-Peak Hours

hough delivery has proven to be a huge market with the likes of UberEats and Grubhub snatching up restaurant dollars, it has also proven to be extremely expensive for operators and, consequently, for consumers.

According to Forbes, Restaurants could pay anywhere between 11% and 45% commission on each order if they sign up for a delivery service. And while restaurants admit that adding these services improve order numbers and total revenue, these rates are huge. And the delivery fees on the consumer side aren’t tiny either.

Two entrepreneurial brothers based in NYC noticed this issue while scouring for promo codes and coupons to lower their delivery order prices. Wondering, ‘why isn’t there some sort of food delivery happy hour’ Mohamed and Sidi Ahmed Merzouk set out to create this type of app.

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Ford and Postmates Deliver with "Self-Driving" Delivery Vehicles in Miami

Ford and Postmates Deliver with "Self-Driving" Delivery Vehicles in Miami

Ford and Postmates have partnered up to create an on-demand delivery platform powered by a self-driving delivery service that is currently being tested in Miami.

In a self-penned article on Medium, Ford Autonomous Vehicle Business Team member, Alexandra Ford English says the on-demand delivery platform is currently being tested in Miami and Miami Beach with more than 70 businesses participating, including local favorite, Coyo Taco. For residents in the area, when you order through Postmates, you could be given the option to have your food delivered by a self-driving research vehicle.

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Red Robin on Best Practices for Restaurant Takeout and Catering Differentiation

Red Robin on Best Practices for Restaurant Takeout and Catering Differentiation
  • Erle Dardick and Valerie Killifer explore takeout and catering as two separate "channels" in your restaurant make-up.  These "channels" need to have different strategies to work effectively. 

  • Trudy Jones, Director of Alternative Platforms for Red Robin, explains the different elements to consider when taking on takeout and catering channels in your restaurant. 

Takeout and catering are completely different businesses, and the secret to making them work successfully is in the design of different consumer solutions for each channel, including unique transaction workflow, menus and product selection, packaging, centralized services, and workflow — and each have entirely different strategies. In this episode of The Takeout, Delivery, and Catering Show we speak with Trudy Jones - Director of Alternative Platforms for Red Robin, to explore the different elements required for takeout and catering, and why each one is important for delivering a brand experience that keeps customers coming back for more.

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