Lidl is testing an on-demand delivery service with e-Commerce bulk retailer Boxed that is designed to get customers their groceries in as little as three hours after they place their order. Shoppers can now browse the entire Lidl assortment as well as the inventory of snacks, fresh produce, beverages and home essentials on Boxed.com. Upon checkout, shoppers can schedule a two-hour delivery window to receive their groceries in person.
The six-month Boxed Express pilot program will kick off in June in two locations: Staten Island, N.Y. and Powder Springs, Ga. The test represents the first national retail partnership for Boxed, which will offer Lidl access to a homegrown suite of technology and services that spans the entire shopping experience from checkout to fulfillment.
Boxed secured a $110 million funding round in August 2018 led by Japanese supermarket Aeon, which enabled the company to start conversations with potential retail partners for licensing various parts of its technology. Boxed writes its own software, runs three fulfillment centers and builds its own automation robotics in-house.
In the future, Lidl also can leverage the Boxed fulfillment centers, buy online/pick up in-store capabilities and Smart Optimization feature, which is designed to predict when shoppers will most likely run low on a particular product, offer recommendations for shopping and prompt automatic reordering. Boxed also could build Lidl a web site that can inform customers about the exact expiration date of each item in their cart.
Lidl and many other regional grocers only maintain local warehouses, so Boxed could potentially start storing products for Lidl’s in-house private-label brand and distribute it across the country for the first time.
While Lidl currently has only 68 U.S. stores, the German grocer’s global footprint reaches 10,500 stores in 29 countries, suggesting that Boxed could have a much larger potential consumer base to build on.