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The Wall Street Journal has a story about how food delivery companies that traditionally served the restaurant and fast food industries - such as DoorDash and Postmates - now are targeting the supermarket and convenience store businesses for future growth.

The additional focus, the story points out, puts these delivery companies in competition with retailers that are doing their own deliveries (like Ahold Delhaize-owned Peapod, or Fresh Direct) as well as with those using other third-party services such as Instacart, UberEats, or Target-owned Shipt. And, of course, it is competing with Amazon.

The reason is simple and economic: "U.S. consumers spend more on groceries than they do at restaurants on average annually, according to the Labor Department, making delivering groceries an opportunity for companies that have mainly focused on restaurants until now."

According to the Journal, "Postmates said Wednesday that it would start making deliveries from 174 Walgreens and Duane Reade stories in Manhattan and Brooklyn. Postmates said it hopes to take the partnership with the owner of those chains, Walgreens Boots Alliance Inc., nationwide.

Postmates also makes deliveries from Seven & i Holdings Co. ’s 7-Eleven stores and Walmart Inc., the largest U.S. food retailer."

In addition, "Walmart products are also available for delivery on DoorDash and some regional services. DoorDash in August signed an agreement with e-commerce platform Mercato Inc. to make same-day deliveries from about 750 independent grocers in 22 states."
KC's View:
In the fast food business, these delivery companies seem to be commodities - a lot of fast feeders are being served by a number of different services. I'm not sure that works in the supermarket business … I think there needs to be greater connection to the brand.

The question is whether they can undercut Instacart, a company that seems to want to compete with its retail clients long-term, not just serve them. I think that makes it vulnerable, and these services may create real problems for it.