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No delivery? No problem – if you’re Trader Joe’s

Business Insider is reporting Monrovia, CA-based Trader Joe’s is ending delivery, with no plans to pick it back up.

The company had offered the service at New York-area stores for the past 10 years, much longer than competitors just now ramping up their grocery delivery game.

The company said the cost of delivering is “unsustainable,” for its customers, according to the article.

This move makes a lot of sense to me.

I’ve often said that consumers don’t have a grasp of the true cost of e-commerce in the way that we’ve been doing it in the U.S. Is it sustainable to continue with the labor and logistics of stocking products, only to have someone pick, pack and deliver them from the retail location? I’m not sure.

Many retailers are going with “gig economy” solutions like Instacart and Shipt, but those solutions don’t reflect the true cost of grocery delivery either.

A recent Miami Herald article pointed to Instacart’s new pay structure for its gig workers that has resulted in pay cuts between 30 and 70 percent, according to the shoppers they interviewed.

There’s also been backlash recently about the collaborations between retailers and third-party providers, and what it means to share your customer data with a company like Instacart.

This analyst says working with Instacart is like bringing in a Trojan Horse, and suggests they could become a retailer on their own, given their e-commerce insights.

It’s no coincidence Amazon dropped Instacart for Whole Foods deliveries, and it’s also no coincidence Cincinnati-based Kroger Co. is moving forward with Ocado and automated warehousing for e-commerce. Grocers are going as fast as they can to make sure they’re not left out of e-commerce, and the next steps will be to make it as efficient as possible.

But is delivery for everyone? I think it’s wise for a player like Trader Joe’s to recognize where it is in the market – offering a unique, continually-evolving, limited assortment consumers can’t really get anywhere else.

Going to a store like Trader Joe’s is a true treasure hunt for consumers, and they don’t need to do that online.


Pamela Riemenschneider is the Retail Editor for Blue Book Services