Lidl has entered into partnership with Boxed.com to test home delivery in the New York and Georgia markets. Lidl will utilise Boxed’s fulfillment network to deliver its products.
Curated range online wholesale model
Boxed.com is a fast-growing, online food and consumables retailer. It has carved a niche in the US market through developing a wholesale-style model, focusing on offering a small number of items in larger pack sizes. Established in 2013, the retailer has placed technology and data at the heart of its operations. Its curated range model, offering around 1,600 items in total and 25 items per category, has proved popular with customers. It also places a strong emphasis on customer engagement, including providing a selfie of each customer’s order with their delivery. Last year, Japanese retailer, Aeon, led a Series D round of funding in the business, raising $111m.
Adapting its offer to the US market
The partnership with Lidl represents a new phase of development for both retailers. However, it does work with the on-demand delivery service, Shipt, for same-day delivery, with its network of on-demand shoppers picking directly from Lidl’s stores. New York and Georgia are relatively new markets for Lidl in the US, as it approaches the 70-store mark. Partnering with Boxed.com could spearhead its expansion in these cities. Lidl continues to adapt its offer for the US market, recently sharing plans to grow extensively in the New York market over the next 18 months following its acquisition of the Best Market chain last year.
Boxed optimising its technology capabilities
Having focused on developing most of its technology and systems in-house, Boxed.com is well-positioned to capitalise on its investments through retailer partnerships. With four distribution centres across the US, and an additional site under development, it has focused on automation and robotics to reduce the cost of fulfillment. Crucially, the business has expertise in handling fresh foods. Partnering with other retailers helps it to maximise asset capacity and generate a new revenue stream. US food retailers are currently piloting a range of different fulfillment models beyond store-based picking, including optimising Ocado’s technology solutions, developing store-based automated picking and dark store picking.
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