Walmart teams up with Postmates for grocery delivery service expansion to counter Amazon

(Bigstock Photo)

Walmart is stepping up its grocery delivery service through an agreement with Postmates to take on Amazon and Instacart in the highly competitive arena.

Walmart previously announced plans to expand its grocery delivery service from six test markets to 100 metro areas, covering 40 percent of U.S. households. The two companies said Walmart will leverage Postmates’ “growing fleet of 160,000 couriers” to fulfill that mission.

(Postmates Photo)

Walmart will pair its own staff of personal shoppers with Postmates couriers. The newly minted alliance will start its program in Charlotte, N.C. and expand to more markets in the coming months.

Walmart offers same-day grocery delivery with a $9.95 fee and a minimum order of $30. For comparison, the AmazonFresh grocery delivery service requires a Prime membership — $99 per year or $12.99 per month — plus an additional $14.99 monthly fee. Instacart orders vary in price by market and time of day.

The news of the deal with Postmates comes as a bit of a surprise as Instacart looked like a favorite to land Walmart after teaming up with its subsidiary Sam’s Club.

The expansion of grocery delivery and subsequent alliance with Postmates is another example of Walmart’s efforts in a multi-pronged struggle with Amazon. In addition to delivery, Walmart offers grocery pick up in more than 1,200 stores nationwide, with 1,000 more to come this year. Walmart also recently announced expansion of the hulking Pickup Towers, which allow customers to order items online and retrieve them at the store.