Instacart's CEO describes the moment he discovered Amazon was stealing its Whole Foods business (AMZN)

pulse

September 19, 2018 2:23 PM

Instacart is a delivery company that pairs customers with personal shoppers to delivery groceries. It partners with 300 chains across North America.

In 2016, it signed a five-year contract with Whole Foods to become its exclusive delivery partner. In 2017, Whole Foods was acquired by Amazon.
Instacart's CEO

On 17 June 2017 Amazon announced it would be buying Whole Foods for $13.7 billion, sending shockwaves around the market, and sparking off the beginning of an arms race between US grocery stores.

At the time, Instacart, a delivery company that pairs customers with personal shoppers to delivery groceries to their homes, had a deal with Whole Foods to exclusively deliver its produce around the US. When the news of the Amazon deal broke, the founder and CEO of Whole Foods, John Mackey, called Instacart's CEO

"He wanted me to be one of the first people to know," he said.

Mehta explained that the news sent the whole industry into shock and for several weeks everyone went silent. "At that point we had to game plan. The whole industry had to game plan," he said.

In the months that followed, Instacart signed deals with several major retailers in the US including Sam's Club,

Bloomberg reported that Instacart shoppers at a store in San Francisco were now having to prepare deliveries in the corridors after being pushed out of designated packing areas by Amazon's own delivery staff.

However, he emphasized that the company does not rely on Whole Foods.

"Whole Foods is about 1.5% of the overall grocery market," he said. "Most Americans do not shop at Whole Foods. The retailers that most Americans shop with are partners with Instacart."

Mehta said that the company's fastest growing markets are in areas where the household income is under $100,000.

On Tuesday, Aldi became the latest retailer to rollout nationwide delivery with Instacart.

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