drone pilot industryRush for Speedy Deliveries Continue, Retailers Up their Game

September 17, 2021by helo-10

Technological advancements have radically altered the way we shop. From online ordering to flexible and swift delivery systems, consumers can choose from a variety of options that suit their lifestyle and convenience. E-commerce and related services reached a whole new high amid the COVID-19 pandemic as consumers looked for ways to meet their daily needs, while avoiding crowded places.

Although the surge in online deliveries last year has gradually slowed, given less stock hoarding practices, consumers’ preference for online deliveries have gone up much higher than the pre-pandemic levels. Retailers, especially those engaged in groceries, are competing among themselves to offer best-in-class delivery services. The companies have been coming up with revolutionary concepts like deliveries in less than an hour, contactless lockers and employment of drone services.

Whether such services are offered by the companies or through forging partnerships, it calls for considerable investments pertaining to technology, labor and transportation. The expansion of delivery systems has also helped the industry participants to provide greater employment opportunities.

From startups to giants, several companies are making radical moves in delivery systems. Supermarket biggies like Walmart Inc. WMT, The Kroger Co.’s KR and Albertsons Companies, Inc. ACI and a few others have continued to ramp up their delivery game amid growing competition from Amazon.com Inc. AMZN. That said, let’s take a closer look at some of the prudent delivery solutions being offered by some of the renowned companies in the grocery retail space.

Kroger Promises Delivery in 30 Minutes

Kroger’s latest move, in its partnership with Instacart, is aimed at pushing the grocery delivery game to a new level. This well-known supermarket chain is extending its partnership with Instacart by launching the new ‘Kroger Delivery Now’ service that will provide customers with food and household staples in 30 minutes. The service will cover as many as 25,000 items across several categories, to approximately 50 million households. The new solution will make use of the company’s existing network of more than 2,700 stores. The move is likely to elevate the supermarket giant’s positioning in an already-crowded and highly-competitive grocery delivery space.

Kroger has been quite active when it comes to enhancing its delivery solutions. Its partnership with Instacart dates back to 2017. Through the alliance, the company has been offering two-hour grocery delivery. It has been focusing on no-contact delivery option, low-contact pickup service and ship-to-home orders. Kroger continues to expand contactless payment solutions like Kroger Pay, Scan as well as Bag and Go and has been accepting Supplemental Nutrition Assistance Program (SNAP) benefits for pickup orders. The company is expanding the Customer Fulfillment Center (CFC) to ensure efficient deliveries. It also opened its first two Kroger Delivery facilities, powered by Ocado, in Ohio and Florida. Kroger’s buyout of meal kit provider, Home Chef, is noteworthy. The company has announced the Kroger Drone Delivery pilot in partnership with Drone Express.

The company is doing everything to meet the rising demand for Pickup orders, reinforcing the importance of timely delivery to customers. Last year, the company achieved more than $10 billion in e-commerce sales. It is committed toward doubling online revenues and profitability by 2023. Shares of this Zacks Rank #2 (Buy) company have increased 16.6% in the past six months.

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Walmart is Being Futuristic, Exploring Drone Deliveries

Walmart believes that autonomous technologies can elevate retail operations to the next level. This retail behemoth has been exploring opportunities in drone delivery and invested in DroneUp. The move comes after successful trials during the pandemic. It has also been piloting drone delivery in the United States with Flytrex and Zipline. Apart from exploring drone deliveries, Walmart is venturing into self-driving cars to expand last mile delivery ecosystem. In April 2021, Walmart made an investment in San Francisco-based autonomous vehicles company — Cruise.

Other prudent investments made by the company for bolstering its delivery arm includes HomeValet, introduction of Carrier Pickup by FedEx and launch of Walmart+ membership program among others. The company’s alliance with DoorDash DASH, Instacart as well as efforts to expand Scan & Go services are noteworthy. Walmart’s Express Delivery solutions help fulfill orders in less than two hours.

In earlier developments, Walmart teamed up with Point Pickup, Roadie and Postmates as well as acquired Parcel to enhance its delivery service. The company’s store and curbside pickup options add to customers’ convenience. As of second-quarter fiscal 2022, Walmart U.S. had 3,900 pickup locations and 3,250 same-day delivery stores. The company is undertaking every effort to develop a futuristic and well-coordinated delivery network that spans across the streets, sidewalks and the skies. Shares of this Zacks Rank #2 company have increased 8.1% in the past six months.

Albertsons Boost Deliveries With Partnerships, PickUp Services

Leading food and drug products retailer, Albertsons, has been focused on strengthening its grocery delivery capabilities to make shopping more seamless. In June, the company announced its partnership with the technology firm DoorDash to boost on-demand grocery delivery services. Through this tie-up, customers can get products delivered from about 2,000 Albertsons banner stores in the country. Also, the Albertsons-DoorDash tie-up launched a digital gaming experience for its customers. The company also holds partnerships with Uber Technologies Inc.’s UBER Uber Eats and Instacart

Earlier this year, Albertsons installed a contactless automated grocery PickUp kiosk at one of its Jewel-Osco stores in Chicago. In fact, the company prides in being one of the first American grocery retailers to offer such automated kiosk-related services.

The company has been particularly focused on expanding contactless services. Last year, it installed PickUp lockers across several Jewel-Osco stores. Its pickup services such as Drive Up & Go options have been attracting greater household spending. Through the collaboration with third-party vendors, the company offers deliveries within two hours. The launch of Deals & Delivery app as well as ‘Albertsons for U’ loyalty program are also aiding to provide efficient delivery services to customers. Shares of this Zacks Rank #2 company have increased 55.9% in the past six months.

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The Kroger Co. (KR) : Free Stock Analysis Report

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