Whole Foods Expands Delivery Options

Whole Foods Market Inc. (WFM) on Monday said it would expand its grocery delivery and pick-up options in more than a dozen cities--the specialty-food retailer's latest move to contend with competitors such as Kroger Co. (KR) and Amazon.com Inc. (AMZN).

The Austin, Texas, company said it is partnering with Instacart, a website and mobile app where customers can order groceries and have them delivered within an hour, to offer grocery services in 15 cities, including New York, Washington, D.C., and Philadelphia.

Whole Foods and Instacart will also launch a pilot program in Boston and Austin this month to allow customers to pick up groceries ordered through Instacart in their local store.

The move comes as Whole Foods is dealing with intensifying competition from new specialty stores such as Sprouts Farmers Market Inc. (SFM), as well as grocery giants such as Wal-Mart Stores Inc. (WMT) and Kroger, who are encroaching on the specialty-foods business that Whole Foods once dominated. Amazon, meanwhile, has been pushing higher-end foods in its grocery delivery service in Seattle, San Francisco and Los Angeles.

Despite moves to spur growth through price cuts, Whole Foods lowered its annual sales projection in July for the fourth time in nine months after posting a 3.9% increase in same-store sales, its slowest pace in more than four years.

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