Instacart adds fresh food delivery for grocers

The leading packaged grocery deliverer has acquired a platform to integrate foodservice delivery, building bigger online baskets for supermarkets.
Dan Ochwat
Executive Editor
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As grocery stores continue to grow their exclusive and fresh prepared food operations, Instacart is looking to help deliver those meals through its platform.

The leading online packaged grocery delivery platform has acquired FoodStorm, an order-ahead management system that powers online food ordering for grocers. The FoodStorm system will be integrated into the Instacart platform so users can order fresh hot and cold side dishes, cakes and sushi from the grocery store either alone or as part of its larger grocery order.

Instacart said shoppers who buy foodservice items have significantly larger baskets and shop more frequently than customers who don’t, adding that exclusive order-ahead items and prepared foods are typically more profitable than traditional packaged groceries.

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FoodStorm was founded 14 years ago and has existing partnerships with Albertsons banners Balducci’s and Kings Food Markets, Bi-Rite Market, Mollie Stone’s Markets, Uncle Giuseppe's and Roche Brothers Supermarkets, all of which are Instacart existing partners. However, the partnership with Instacart will make the FoodStorm technology available to more retailers. Instacart will add in talent from FoodStorm, based in the U.S. and Melbourne, Australia.

The FoodStorm platform was designed to give grocers a comprehensive SaaS offering that covers multi-channel ordering — e-commerce, phone or in-store kiosk — order management, and payment and fulfillment. Its technology also integrates easily with a large variety of third-party systems including point of sale systems (POS) and offers customer relationship management (CRM) capabilities that help grocers collect feedback, market their offerings and leverage promotional features. 

“As a retailer enablement platform, Instacart is focused on growing our partners' businesses by investing in innovative new technologies and services that deliver significant value to them and their customers," said Mark Schaaf, CTO, Instacart. "Our goal is to help our retail partners increase their sales and ensure more of their customers' everyday meals come from the grocery store. That's why we're excited to welcome the talented FoodStorm team to Instacart and integrate their end-to-end order-ahead and catering platform into Instacart's leading enterprise offering. For retailers, this new enterprise solution helps them bring even more of their inventory online, enhance their ecommerce capabilities, grow their business and meet the evolving needs of their customers. And, for customers, this unlocks a healthier, more affordable alternative to restaurant delivery —creating an easier way for people to order prepared foods online directly from their favorite grocers." 

With more consumers eating at home due to the pandemic trends, grocers have been developing more “restaurant-quality” foods for shoppers to bring home and ease the rise in cooking at home. It’s something the retailer Uncle Giuseppe’s strives toward.

“Delivering a world-class customer experience and excellent prepared foods is the mission of our business, and FoodStorm and Instacart have helped us do just that," said Russell McVeigh, catering director at Uncle Giuseppe's Marketplace. "Once we deployed FoodStorm's technology, online sales doubled and we were able to be more innovative with our menus because of the increased visibility FoodStorm's platform provides. Both FoodStorm and Instacart have been critical to our growth and ability to serve our customers, and we're excited to see what compelling enterprise products they'll develop together."

Instacart has grown immensely over the past year, now working with more than 175 local, regional and national grocers across North America, including Costco Canada, Heinen’s, Sprouts, The Fresh Market and Wegmans. 

 "Grocery is an incredibly complex retail category, making the need for enterprise-grade solutions like FoodStorm and Instacart critical to the long-term success of the industry we all rely on to put food on our tables. We're excited about this next chapter as we join the Instacart team and create new ways for retailers to serve the ever-changing needs of their businesses and customers,” said Rob Hill, Foodstorm CEO.