The independent natural foods retailer began a new partnership today with Instacart, an online delivery service, and will expand its home delivery service to major markets across the country.
Sprouts Farmers Market currently offers home delivery in eight cities across the country. The retailer will begin its rollout with Instacart service to markets in its home state of Arizona. Additional regions will be announced at a later date.
Customers will be able to order thousands of fresh, natural and organic products from Sprouts by visiting delivery.sprouts.com, or the Instacart website or mobile app, where they can choose to have their groceries delivered the same day within one or two hours, or schedule a delivery for later in the week.
Expanding its online home delivery services is a natural step for the healthy grocer. As reported in t Food Dive, Sprouts Farmers Market CEO Amin Maredia told attendees at Goldman Sachs’ 24th Annual Global Retailing Conference this week that home delivery has expanded the company’s market reach, and the company wants to become a top e-commerce player in the coming years.
“We are excited to respond to customer demand for fast, convenient home delivery of their favorite Sprouts products in all of our major markets across the country,” Maredia said. “Home delivery is a natural way for Sprouts to engage with our customers on their healthy living journey, and our partnership with Instacart allows us to quickly scale for growth.”
Sprouts’ relationship with Amazon had come under scrutiny from investors following the acquisition of Whole Foods in June. Sprouts stock price dropped nearly 10% after Amazon announced opening price cuts at Whole Foods. Maredia said at an investors’ conference last fall that the company was exploring other e-commerce services. However, in a recent interview with Food Dive, Maredia said he was pleased with the Amazon relationship. “We’re still with Amazon in eight markets, and that’s not going to change in the near future,” he said.
Still, Sprouts is short of the goal expressed on its Q2 earnings call to expand the Amazon relationship to 20 stores. The Instacart partnership seems to signal that’s unlikely.
Utlimately, Maredia said he sees Sprouts becoming a top online grocery provider in the coming years. The retailer plans to grow by around 30 stores per year, with plans to expand from its current count of 260 to around 1,200. Many other retailers have expanded their e-commerce services, he noted, but the ones that invest and innovate will ultimately dominate the market.