Albertsons Companies and Takeoff Technologies are collaborating on the future of grocery micro-fulfillment centers (MFC). The two companies have decided to form a strategic partnership with dedicated teams to collaborate on the evolution of microfulfillment capabilities to drive the future of e-commerce order fulfillment.
Albertsons has agreed to purchase additional MFCs from Takeoff and is evaluating market expansion opportunities. Albertsons and Takeoff worked closely together on the successful implementation of the company's first MFC in South San Francisco in October 2019.
“The micro-fulfillment center model is a key element in the store of the future,” says Vivek Sankaran, Albertsons Companies President and Chief Executive Officer. “It combines the efficiency of automation with the ease of meeting customers when and how they want to shop. In working with Takeoff, we can evolve how the MFC ties into our store and e-commerce ecosystems and accelerate our path to best serve our customers.”
The companies originally began their partnership in 2018 with the announcement of two pilot micro-fulfillment centers that would be constructed in existing grocery stores. Albertsons began operating its first pilot unit on Oct. 23 at a Safeway in South San Francisco. Another pilot unit is scheduled to begin operations at a Safeway in San Jose, CA before the end of 2019.
“We are thrilled to broaden our partnership with Albertsons Cos., a clear leader in grocery retailing and a key player shaping the future of eGroceries,” added Max Pedró, co-founder and president of Takeoff. “With our strategic partnership, we’re confident we’ll be able to add significant value to their business and consumers as we work in partnership to define the future of e-commerce.”
Micro-fulfillment centers bring together the proximity of brick-and-mortar stores with the automation capabilities of a large warehouse. Located inside an existing store, micro-fulfillment centers typically hold about 15,000 to 18,000 of the local market's most popular products.
“In collaborating with Takeoff, we’re able to leverage their thought leadership in e-commerce fulfillment with our expertise in running great grocery stores that meet customers’ everyday needs, and that’s exciting turf for us,” said Chris Rupp, Executive Vice President and Chief Customer and Digital Officer at Albertsons. “By placing an MFC in an existing store close to customers, we can carry a diverse and locally relevant selection of products with the friendly touch of our local team to service the customer.”
According to research by Takeoff Technologies, micro-fulfillment centers increase productivity by up to ten times through improved speed, productivity, accuracy, and efficiency. By providing real-time information about inventory, robotic fulfillment can greatly reduce or even eliminate product substitutions.
“We are living in historic times. The grocery industry is transforming its way into the future, and the winners will be the ones getting it right first. Albertsons Cos.’ move to expand its micro-fulfillment capability is a clear testament of such transformation,” said José V. Aguerrevere, co-founder and chief executive officer of Takeoff.