Online grocer and delivery platform Farmstead has announced a partnership with delivery-and-logistics company DoorDash that seems aimed at expanding both companies' ability to both serve and compete with the traditional supermarket industry.
Farmstead essentially has two businesses. It is an online grocer, pledging "fresh, high-quality groceries, delivered for free, at better prices than local supermarkets," serving its original market of the San Francisco Bay Area as well as Charlotte, North Carolina, with plans to "launch service in Raleigh-Durham, Nashville, Miami and at least 13 other cities in 2021." And, it offers its Grocery OS software to other grocers, which it says "boosts the delivery capacity and profitability of any grocer-controlled pickup/delivery fulfillment operation."
Now, the Farmstead app will be available via the DoorDash app, which will extend its penetration in the markets it serves, and grocers using Farmstead's Grocery OS will have "immediate access to DoorDash’s platform and delivery network via Drive, DoorDash’s white-label fulfillment platform that powers direct delivery for any business." And, grocers will be able to "list their own brands powered by dark locations on DoorDash’s app and websites for one-hour delivery, increasing their reach and simplifying delivery operations."
“We’re excited to partner with Farmstead to support its national expansion while offering our customers even more local grocery selection on the app,” said Fuad Hannon, Head of New Verticals at DoorDash, in a prepared statement. “We’re proud to play a part in accelerating the growth of local grocers and serving their local communities, with a focus on selling essential perishable staples customers need.”
Pradeep Elankumaran, co-founder and CEO of Farmstead, added, "Together, Farmstead and DoorDash can remove the two biggest barriers to grocery e-commerce success: order picking and packing efficiency, and low-cost, high quality delivery with a production capacity of thousands of orders per day. Farmstead’s Grocery OS facilitates efficiency inside the warehouse, and DoorDash provides the last-mile delivery logistics and marketplace platform to reach consumers."
- KC's View:
Seems likely that at some point, if this partnership works out, that DoorDash could well acquire Farmstead … which would be interesting, since DoorDash doesn't just serve retailer-clients, but even competes with them at some level in the c-store space with its DashMart offering.
The question that retailer-clients of both companies will have to answer is which brands are being bolstered … and are their individual brands being subsumed?