retail news in context, analysis with attitude

The Seattle Times reports that Instacart, the online personal shopping service, launched yesterday in Seattle.

According to the story, "Unlike Amazon Fresh, online-retail giant Amazon.com’s grocery-delivery service, Instacart has no inventory or trucks. Rather than hiring a huge staff and paying them benefits, Instacart contracts with 'personal shoppers.' The contracted workers shop for cereal, diapers, produce and more from local grocery stores and deliver them to customers. They work for commissions and pay for their own gas. Instacart plans to employ just two people in Seattle to manage its operations … In Seattle, Instacart will start with 20 or so shoppers who will select items from QFC and Costco stores. Instacart has no formal relationship with either store. And because Instacart has purchased Costco memberships its shoppers can use, its customers can select grocery items from the warehouse club even if they aren’t Costco members."

The story goes on to say that in Seattle, "one-hour delivery costs $14.99; two-hour delivery is $3.99. And the minimum order size is $10. Customers can also buy a $99 annual membership to Instacart Express that eliminates delivery fees for orders over $35. Instacart also marks up prices on some items in order to make money."
KC's View: