From merchants to tech providers, the online grocery space is beginning to take shape, with mergers and acquisitions (M&A) winnowing some of the smaller players and reshaping the competitive landscape.
Most recently, sustainability-focused online grocer Misfits Market announced Wednesday (Sept. 7) its acquisition of another anti-food-waste eGrocer, Imperfect Foods, for an undisclosed amount. The two companies will operate under their own banners “in the short term,” per the news release, under one CEO, Misfits’ Abhi Ramesh, though it seems likely that Imperfect Foods’ network will be folded into the Misfit Foods brand down the line.
“We have a tremendous opportunity to advance the shared mission of both brands, which is nothing less than a fundamental re-imagining of both the grocery category and the broken U.S. food system,” he said in a statement. “The strengths of the Imperfect Foods organization, from its in-house delivery fleet and robust private label program to its sustainability commitments and innovation, add immediate scale and depth to what we’re building at Misfits Market.”
A significant share of consumers order groceries every month, according to data from the July edition of PYMNTS’ ConnectedEconomy™ series, “The ConnectedEconomy™ Monthly Report: The Rise of the Smart Home.” The study, which drew from a May survey of more than 2,600 U.S. consumers, found that 40% order groceries online for home delivery every month.
Get the study: The Rise of the Smart Home
This is certainly not the only instance of eGrocery consolidation seen this year. On the grocers’ side, it was reported in June that Indian food delivery firm Zomato was acquiring local grocery delivery startup Blinkit for 44.47 billion rupees ($568.2 million) in an all-stock deal as part of its effort to expand its capabilities in the increasingly competitive category. Plus, in March, media reports revealed that German ultrafast grocer Gorillas finalized the closing of its first acquisition deal for the French delivery startup Frichti for undisclosed terms.
This consolidation is not only happening for grocers but also for tech providers offering solutions for grocers’ eCommerce channels. Take, for instance, online grocery giant Instacart, which has been on a spending spree. On Wednesday, the company announced its latest acquisition, Rosie, a company that offers eCommerce solutions for independent grocers. The news came less than a week after Instacart announced the acquisition of Eversight, a pricing and promotions platform for consumer-packaged goods (CPG) brands and retailers.
“Together [with Rosie], we’ll build more technologies that help independent grocers accelerate their pace of innovation so they can continue to compete, grow, and serve their customers however they choose to shop,” Instacart Chief Business Officer Chris Rogers said in a statement.
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