CINCINNATI – Kroger Co. announced Tuesday that it has partnered with Instacart Inc. to deliver online grocery orders to your home in just 30 minutes.
The move is set to help the Cincinnati-based grocery chain grow its business without creating new jobs, a necessary step considering there are currently about 20,000 active job openings, CNBC reported.
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Under the partnership, deliveries will be made by gig economy workers for the San Francisco-based third-party delivery service, the network reported.
Rodney McMullen, CEO of Kroger, told the Wall Street Journal that the supermarket chain tested 30-minute deliveries about two years ago, but staff shortages made this impractical. Leveraging Instacart’s existing technology and staff addresses logistics, he said.
With more than 2,700 stores under multiple banners, Kroger is the largest supermarket operator in the country and includes household brands such as Ralphs, Harris Teeter and Fry’s. The grocer closed fiscal 2020 with 460,000 employees, but the COVID-19 pandemic has created a significant national labor shortage making it harder for hires to keep pace with the growth, CNBC reported.
“We’re hiring aggressively wherever we can,” McMullen told the network’s “Squawk Box”.
“One of the biggest limitations we have right now is finding talented people,” he added.
According to the Journal, high labor and transportation costs have made it difficult for retailers to achieve “consistent profitability on delivery,” especially as the surge in grocery deliveries fades in the pandemic era.
Fidji Simo, CEO of Instacart, told the newspaper that shipments of convenience store items like snacks and toiletries are growing rapidly, with about 20% of the company’s customers paying more for faster delivery.
“The consumer’s need for speed is real and will remain,” said Simo.
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