Kroger and Instacart rolling out Online Grocery Delivery Nationwide

Kroger (NYSE: KR) is rolling out online grocery through Instacart nationwide. If you type the words Kroger and Instacart into a search engine this website comes up.

Visitors are offered free delivery on their first order. What’s more telling is a map that shows Instacart delivery is available in hundreds of cities across the United States.

Many of those cities are served by Kroger supermarket brands; such as Ralph’s, Harris Teeter, Kroger, King Soopers, Fred Meyer, Smiths, Bakers, and City Market. Many regions that lack Kroger including Minneapolis, New York State, Vermont, New England, and Miami appear on the map.

Vast numbers of markets served by Kroger appear on the map including Denver, Los Angeles, Phoenix, Atlanta, Chicago, Dallas, Richmond, Kentucky, Portland, Oregon, and Cincinnati. The obvious conclusion we can make from this is that Kroger is planning a major partnership with Instacart.

Target and Walmart also offering Grocery Delivery

One obvious possibility here is that Kroger is planning to buy Instacart. Such an acquisition is not farfetched; Kroger just sold its convenience stores for $2.1 billion which could finance an Instacart purchase. Target (NYSE: TGT); one of Kroger’s biggest competitors, has bought the grocery-shopping service Shipt and Walmart (NYSE: WMT) has plans to offer grocery delivery in 100 cities by the end of 2018.

Online grocery delivery is probably coming to your neighborhood whether you want it or not. What is not clear is whether anybody can make money at online grocery delivery.

The way we shop for groceries is about to change dramatically. One has to wonder if traditional supermarkets; and retailers like Costco Wholesale (NASDAQ: COST), can survive in such an environment. Also threatened by the avalanche of new delivery services will be discounters like Aldi and the various dollar store operators like Dollar Tree (NASDAQ: DLTR). Stores might have to start offering grocery delivery to survive – even if they cannot afford it.

The grocery delivery van is about to become a common sight in America’s neighborhoods. Investors might be well advised to buy stock in van makers such as Fiat Chrysler (NYSE: FCAU), General Motors (NYSE: GM), and Ford (F); demand for their products is likely to grow as retailers need vehicles to haul all those groceries to your door.

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