Walmart Inc. and logistics firm Deliv have ended their same-day grocery delivery partnership, which could be a setback in the retailer’s competition with Amazon to deliver groceries to customers’ homes.
According to a Reuters report attributing two people familiar with the situation, Deliv served the retailer with a 90-day termination notice, and the two companies stopped working with each other in late January. Deliv was one of Walmart’s earliest delivery partners with pilot programs in Miami and San Jose.
Walmart began bolstering its partnerships with third-party courier firms to reach consumers in 100 U.S. cities last year, after failing to use Uber and Lyft to deliver groceries, and struggling in its attempt to use its own employees to deliver goods.
Walmart confirmed the previously unreported decision, and said it still partners with seven delivery firms, including DoorDash and Postmates, four of which it signed up in January. The company also announced last month that it had partnered with last-mile delivery providers Point Pickup, Skipcart, AxleHire and Roadie to help power the Walmart Grocery Delivery service in metropolitan areas across four states.
According to Reuters, people familiar with the Walmart partnership with Deliv said drivers had to frequently wait 40 minutes or more to collect grocery orders when they showed up at stores. One reason for that, they said, is because Walmart gives a priority to customers over delivery drivers during regular hours, which complicated the partnership.
The store operations at Walmart “were a huge problem,” said one of the people with direct knowledge of the matter, adding the retailer could not “process online grocery orders fast enough.”
Deliv declined to comment. Walmart spokeswoman Molly Blakeman told Reuters the retailer and Deliv mutually decided to end the partnership. “As with any pilot, the intent is to learn. And we ultimately came to the conclusion with Deliv that while their platform is a good delivery option, it was not the best fit for our program at this time.”
Blakeman said same-day grocery delivery is currently available in 800 of Walmart’s more than 5,000 U.S. stores and warehouse clubs, and the retailer plans to add 800 more this year.
In addition, Walmart, is engaged in several pilots using self-driving vehicles to fulfill online grocery orders, with partners including Udelv, Ford and Waymo. In the test with Waymo (formerly Google’s self-driving car project), being conducted in Chandler, Ariz., autonomous vehicles pick up customers at their homes and take them to the store to collect their orders.
Through Walmart Grocery Delivery — accessed via Walmart.com/grocery or the Walmart Grocery App — consumers can buy fresh produce, meat, seafood, bakery items, pantry staples, various consumables and seasonal general merchandise. At checkout, they select a delivery time window. After orders have been picked by Walmart personal shoppers, a member of the delivery partner’s team retrieves the order from a Walmart store and delivers it to the customer in the designated time frame. Orders carry a $30 minimum and a simple fee structure with “no subscription, no price markups,” Walmart said.