Whole Foods invests in Instacart

Whole Foods (NASDAQ:WFM) has signed a multiyear deal with Instacart and will invest in the delivery company, according to reports.

The two companies signed a five-year delivery partnership making Instacart the exclusive partner, according to Re/code. Terms of the deal were not made public and both companies declined to comment, according to the report.

Retailers, especially grocers, are cozying up with delivery companies like Instacart to provide same-day and even one-hour delivery to shoppers, particularly those in dense urban markets. Younger shoppers are using this service with increased frequency: 20 percent of millennials said they planned to use some kind of grocery delivery service last Thanksgiving.

Instacart also partners with for Costco and Target, while other services including UberRush and Google Express are vying for retail contracts. Whole Foods partners with Google Express to provide delivery from a single store in San Francisco, according to Re/code.

Whole Foods now offers delivery in 16 markets and many stores are seeing sales as a percentage of total sales in the mid-to-high single digits via Instacart. "We are in the process of expanding the service to more stores and several new markets this year," CEO Walter Robb said on a recent conference call.

For more:
-See this transcript at Seeking Alpha
-See this Re/code article

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