Walmart and grocery delivery partner Skipcart are ending their relationship, marking the latest departure from the mega-retailer’s network of logistics companies, according to a published report.
Skipcart notified Walmart on Jan. 31 that the partnership would cease as of April 30, Bloomberg News reported, citing the contents of a letter it had obtained. The end date has since been moved up to March, and Walmart has already reassigned stores once serviced by Skipcart to other companies.
Boerne, Texas-based Skipcart delivers from about 126 stores across 32 states, mainly in smaller markets, and began working with Walmart in late 2018.
Skipcart’s exit follows those of Deliv in 2019 and Uber Technologies the year before, Bloomberg News noted, attributing these failed partnerships to the uncertain economics of last-mile delivery as more U.S. consumers opt to order their groceries online.
Skipcart CEO Ben Jones said that the company, despite doing about 50,000 Walmart deliveries per month, was losing money “hand over fist,” adding that he would rather focus on restaurant deliveries, which are easier and more profitable to transport than groceries.
“The grocery model does not work,” Jones told Bloomberg News. “It doesn’t work today, and it’s not going to work six months from now. We’re all losing money.”
Walmart currently offers home delivery of groceries from about 1,600 stores – double the number it had a year ago – with the orders handled by various companies, including Postmates, DoorDash, Roadie and Point Pickup. The mega-retailer also has an internal delivery platform for self-employed drivers, Spark, which operates in 31 states, and is piloting autonomous delivery vehicles.
Additionally, shoppers can pick up online grocery orders at Walmart parking lots at no charge at more than 3,000 stores, with another 500 set to offer the option this year.
Bentonville, Ark.-based Walmart operates more than 11,300 stores under 58 banners in 27 countries, and ecommerce websites, employing 2.2 million-plus associates worldwide. The company is No. 1 on Progressive Grocer’s 2019 Super 50 list of the top grocers in the United States.