Starting next year, Instacart will begin removing in-store shoppers from Whole Foods stores, signaling the end of a four-year partnership that went on life support the moment Amazon acquired the grocer last year.
Today, Instacart has 1,415 in-store shoppers across 76 Whole Foods locations, and starting in February, 243 of them will be removed, Instacart CEO Apoorva Mehta wrote in a blog post. Eventually, all of the in-store shoppers will leave their Whole Foods locations, though Mehta writes that 75 percent of the shoppers will be placed at other stores. Instacart is also offering a three-month separation package for workers who lose their jobs as a result of end of the Whole Foods partnership.
Amazon has been steadily upping its own grocery delivery service from Whole Foods and phasing out Instacart. Bloomberg reported in March that Instacart delivery contractors were “shunted to a corridor upstairs” in a San Francisco store as Amazon made room for its own personnel. In recent months, Instacart branding has disappeared from Whole Foods stores.
While the end of the Whole Foods partnership is certainly a blow to Instacart, the grocery delivery company has surged since the announcement of the blockbuster acquisition by Amazon. Grocers reckoning with the alliance have been driven into the arms of Instacart, which has signed up or expanded partnerships with several top grocers in the U.S., including Albertsons, Kroger, H-E-B, Sam’s Club, Aldi, and most recently Walmart Canada.
Speaking at the 2017 GeekWire Summit, Mehta said the Amazon-Whole Foods megadeal has been a “blessing in disguise” for his company.
“At this point retailers are coming to us,” Mehta said. “When the Amazon/Whole Foods announcement happened, essentially every major grocery retailer in the country had an emergency board meeting and right after that board meeting they called us.”
Instacart recently landed a massive $871 million, bringing its valuation to $7.9 billion. Instacart has 800 employees and more than 70,000 delivery contractors. The company has more than 300 retail partners, and it delivers from a total of more than 15,000 stores across 4,000 U.S. and Canadian cities.
Instacart is looking to make its mark in Canada, and September it announced “Instacart North,” a Toronto office that the company is looking to staff up with 200 new employees across engineering, product, design and R&D.