In June 2020, grocery delivery was a $3.4 billion business. But by June 2022, that had fallen 26%.
Shoppers shop at a grocery store in Glenview, Ill., Monday, July 4, 2022. U.S. demand for grocery delivery is cooling as food prices rise. Some shoppers are shifting to less expensive grocery pickup, while others are returning to the store. Karen Raschke, a retired attorney in New York, started getting her groceries delivered early in the pandemic. Each delivery cost $30 in fees and tips, but it was worth it to avoid the store.
But as the pandemic eased, demand softened. In June 2022, Americans spent $2.5 billion on grocery delivery — down 26% from 2020. For comparison, they spent $3.4 billion on grocery pickup, which saw demand drop 10.5% from its pandemic highs. Consider a basket of eight staples from Target, including a gallon of milk, a dozen eggs and a pound of ground beef. In store, the order would ring up at $35.12. Target offers curbside pickup for free. Delivery costs $9.99, not including a tip.
Cynthia Carrasco White, an attorney for a nonprofit in Los Angeles, got accustomed to grocery delivery during the pandemic. She still prefers it, since her youngest child isn’t fully vaccinated and it saves time. Retailers are responding by varying delivery prices by time of day. On a recent morning, Walmart offered to deliver a $35 order within two hours for $17.95; that dropped to $7.95 if the order could be delivered between 3 p.m. and 4 p.m.
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Demand for Grocery Delivery Cools as Food Costs RiseU.S. demand for grocery delivery is cooling as food prices rise. Some shoppers are shifting to less expensive grocery pickup, while others are returning to the store.
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Demand for grocery delivery cools as food costs riseKaren Raschke, a retired attorney in New York, started getting her groceries delivered early in the pandemic. Each delivery cost $30 in fees and tips, but it was worth it to avoid the store. Then earlier this spring, Raschke learned her rent was increasing by $617 per month.
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