fbpx
Business

Is curbside pickup-only grocery a viable business model? – RetailWire

Apr 04, 2022

The startup Fresh Street has opened Chicago’s first curbside pickup-only grocery store with a promise to save time and money for shoppers.

“My family and I have experienced the frustrations and inconveniences that plague current online grocery options,” said Mike Sayles, CEO of Fresh Street, in a statement.

The first location, measuring 10,000-square-foot on the border of North Park, West Ridge and Lincolnwood, carries over 4,000 SKUs, including national and local brands. Orders are available for pickup within 30 minutes.

Focusing solely on pickup removes the scheduling challenges that come with delivery and avoid online grocery’s often higher prices. For grocers using Instacart or Shipt, the cost may include higher markups, plus delivery and service fees.

Curbside-only also offers at least some of the convenience of online shopping.

“Our core demographic is families who are really busy,” Mr. Sayles told Block Club Chicago. “You get to a point where grocery shopping is less an experience and more of a chore.”

The platform has a “no substitution” rule to drive efficiencies, although management says it’s “very rare” that an ordered item is out of stock due to the model’s real-time visibility. The location has six designated parking spots – about double that of the typical brick-and-mortar grocery store in the area – with an initial capacity to serve about 2,000 weekly customers.

“We’re focused on faster turnaround times, better availability, getting people in and out of their parking spot quicker – we should be able to do that in under a minute,” Mr. Sayles told the Chicago Tribune.

Many households discovered pickup over the pandemic with eMarketer estimating 35 percent of US digital grocery sales last year were click and collect. At Mercatus survey from last year found 31 percent of US grocery shoppers favoring curbside pickup, ahead of delivery, at 24 percent, but behind in-store, 44 percent.

EMarketer’s recently-released “US Click-and-Collect Forecast 2022” reporthowever, determined overall curbside pickup growth was “well below” expectations. Emarketer wrote, “The era in which click-and-collect options were dramatically shifting the dynamics of both ecommerce and in-store shopping appears to have ended.”

DISCUSSION QUESTIONS: Will a curbside pickup-only grocery store be appealing to large numbers of consumers? What will likely be key to Fresh Street’s success from an execution standpoint?

Braintrust

“If Fresh Street can live up to their promises, keep prices low and are successful at filling orders correctly, they have a successful model.”

wpDiscuz

Related Articles

Leave a Reply

Your email address will not be published.

Back to top button
KQ Education Group