Narayan Iyengar, senior vice president of digital and e-commerce, gives an overview of what Albertsons is doing in e-commerce.

LAS VEGAS — Albertsons Cos. has partnered with Takeoff Technologies to test a micro-fulfillment center in one of its stores.

Narayan Iyengar, senior vice president of digital and e-commerce, discussed the pilot Oct. 30 at new industry event Groceryshop.

“We expect to be able to dramatically drive down pick costs, and then you bolt that up with efficient routing of trucks, we’ll be able to dramatically drive down our pick and delivery costs in a way that makes sense for our customers,” Iyengar said.

Ideally, the system will allow Albertsons to offer its products at prices competitive to what they would get in-store, plus a nominal delivery fee.

The company expects the pilot to begin in 2019.

Albertsons has been promoting its online grocery program quite heavily in stores; between an Albertsons store and a Vons store in Las Vegas, there were signs promoting the service on the front doors, on the outside of the building, near shopping cart corrals, on blades in center-store aisles, and even on restocking carts being used by employees.

The partnership with Takeoff Technologies appears to be another move in a series of them that suggest the industry is getting serious about online grocery.

While pickup and delivery still represents a small portion of sales, Nielsen and the Food Marketing Institute have projected that 70% of people will grocery shop online by 2024.

Earlier this year, Kroger announced a partnership with Ocado Solutions, a company that specializes in online order fulfillment and delivery. In May, Kroger announced it was working on selecting the first three sites for automated warehouses, with the expectation that it would do so for 20 locations total in the first three years of the deal.


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