Thu
Aug 24 2017
11:04 am

An article in KnoxTNToday alerts us that Food City is launching home delivery in the Knoxville area. They are partnering with Instacart to provide the service. I checked, and our local Food City is participating.

You can check it out here.

Spot checking some prices, it appears some items are priced 20% to 30% more than the regular in-store pricing. Clicking the "pricing policy" link just says "Item prices for this retailer vary from the in-store prices in your area." It appears the higher pricing is in addition to delivery fees, unless you opt for a $150/year "Instacart Express" membership.

At least the selection is pretty good, and includes fresh produce, meats and dairy. Pretty much everything we buy is available for delivery. The website is a little messed up, though. Search doesn't seem to work, and browsing sometimes says no items available but shows items if you use a different path.

I get that you have to pay something for the delivery service, but the pricing scheme makes it not very transparent. On a $200 order, it could be $40 to $60 or more plus the delivery fee. You don't really know because they don't tell you the markup. They also don't post the delivery fees or how they are calculated. You don't know until you check out.

It seems like a pretty cool service, especially for those with limited mobility. For the lazy, you never have to get off your couch except to answer the door. But for ~$50 or so per order, we'll keep visiting the store. Plus it gets us off the couch and out of the house.

Topics:
R. Neal's picture

Cost comparison

We had a Food City receipt from last week with 19 items. We exactly matched 15 items from the delivery items menu.

The total in-store cost was $50.42. This included loyalty card discounts (which do not appear to be available when purchasing for delivery).

The delivery items cost would have been $63.47, a difference of $13.05 or 26%.

The delivery fee would have been $5.99 at checkout, making the total cost $69.46, a difference of $19.04 or 38%.

We found $2 worth of applicable manufacturer's coupons on the coupons page. When applied to the delivery checkout cart it reduced the total to $67.46, a difference of $17.04 v. in-store, or 34%.

So the net is that we would have paid $17.04 more (plus tip) for delivery v. what we paid in-store for the same $50.42 worth of items.

R. Neal's picture

Individual item markups

Individual item markups ranged from 13% to 90%. Most were in the 24% to 30% range.

Markup / #items:

13% 1
15% 3
16% 1
23% 1
24% 1
26% 1
28% 2
30% 3
36% 1
90% 1

bizgrrl's picture

You have to wonder if all

You have to wonder if all stores offering delivery have similar price differences, different products maybe.

bizgrrl's picture

Who is the market for this

Who is the market for this service?

Millennials? They should be buying health insurance.

Those with limited mobility? Can they afford it?

Baby boomers? Not our thing?

The rich? Is that a big enough market?

R. Neal's picture

Busy soccer moms?

Busy soccer moms?

CathyMcCaughan's picture

Flu season

The next time everyone in the house has a plague, I'm going to use Kroger's online ordering instead of spreading my germs all over the store.

fischbobber's picture

Kroger App

Look for the Clicklist coupons and make sure you've loaded them in your phone. The coupons are really good and specifically for that service.

CathyMcCaughan's picture

I have a free online ordering

I have a free online ordering coupon saved for the next plague. They should have a BRAT order button prepared for feverish shoppers.

BoB W.'s picture

health problems

It's hard to tell how many folks have extended health problems like myself. I've had vision problems (no driving) since last October.

I was shocked to find out there are aggressive markups on most items as R. reported. I wonder if their delivery fee is progressive with increasing distance? Food City has taken this TOO FAR.

Guess I'll just wait until the wife is back from being on the road.

Commuter's picture

Vacation

DH and I just got back from a long weekend in Orlando. We flew and used Uber to get around rather than rent a car. Used the Instacart service from Publix to have some basic groceries delivered. In this context, it was absolutely worth the pricing premium.

However ... at home I will continue to use Kroger's clicklist service. (They gather the items, I pick up at the store) The time savings from not walking around the store to gather my items plus the impulse purchases not made make it well worth the $5 service fee.

mjw's picture

Agree

Being able to "shop" over a couple of hours (or days) while I'm doing laundry or getting ready for bed, then pop into a parking place for 5 minutes while Krogers' (or Food City's, I use both) great employees load everything in my car is totally worth the 5 buck surcharge. And unlike Instacart the prices are the same as in the store, including sale prices.

The Food City GoCart folks are particularly great, as they will text with you as they are shopping to check on substitutes, or if they notice that you can get a sale price if you go one size up.

Michael's picture

Then again...

Looks to me like if you ran the numbers using the $150 for the "Instacart Express" option ($12.50 mo./$3.13 wk.), it's much more reasonable.
~m.

R. Neal's picture

The $6 delivery fee isn't so

The $6 delivery fee isn't so bad. It's the markup.

Either way, the pepople pulling the orders and delivering them need to get paid.

Consumers have to decde if the service is worth the cost. As with everything else, it will be worth it to some and not for others.

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