Aldi partners with Instacart for online delivery

Aldi Inc. announced on Sunday that it has entered a partnership with Instacart Inc. to deliver groceries in the cities of Atlanta, Dallas, and Los Angeles starting at the end of August, Reuters reported.

The German retailer does not offer customers an option to shop on its own website now and the partnership is a way to test online grocery demand, Aldi's Vice President of Corporate Buying Scott Patton said.

The service will allow shoppers to order goods from Aldi stores using Instacart's website and app. Instacart, which charges a delivery fee, does not hold inventory but picks up orders from the store and brings them to a customer's home in as little as one hour.

"We would like to roll this out very quickly," Patton added. To encourage customer engagement, Aldi is offering shoppers $20 off and free delivery on their first Instacart orders through September 30.

A report from the Food Marketing Institute and market research firm Nielsen in January this year estimated online grocery spending during 2016-2025 to grow from 4.3 percent of the total U.S. food and beverage sales to as much as 20 percent, or more than $100 billion. Last year, online grocery sales were about $20.5 billion.

Aldi currently operates about 1,700 stores in the US. The chain said earlier this year that it expects to become the third biggest grocer in the country by 2022 through a $3.4 billion expansion to 2,500 stores.

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