Shipt is an on-demand delivery service that enables customers to order groceries from supermarkets and other stores in proximity.
The company, which is headquartered in Birmingham, Alabama, was founded in 2014 by seasoned entrepreneur Bill Smith.
In case you’re curious: this is how Shipt makes money
Founder Smith is a seasoned entrepreneur to say the least. He started various businesses, most notably Insight Card Services, a company that sold prepaid Visa cards. That business was sold to Green Dot Bank in 2014.
Smith then used the millions that he netted from the sale to launch Shipt, which was heavily inspired by the likes of Instacart, DoorDash, and Postmates. He even invested $3 million of his own cash to get the business off the ground.
Shipt, after a rather painful pivot that saw the company change its business model from delivering everything to groceries only, became one of the fastest growing services in the industry. A mere 2.5 years later, it was acquired by retail chain Target for $550 million in cash.
Target, in an effort to compete against other chains and their delivery offerings (more on that later), has since expanded the service from 500 to over 5,000 cities in the United States. Shipt is thus able to serve more than 80 percent of all households in the country.
Those households are served by the more than 300,000 ‘Shoppers’ that work for Shipt on a contractual basis. Its iOS app has been reviewed around 90,000 times on top of that.
Unfortunately, Target does currently not disclose any revenue or profit figures. However, Second Measure assumes that Shipt currently accounts for around six percent of all online grocery sales in the United States, making it the third most popular service in the country.
The methodology with which competitors of Shipt are ranked is based on publicly available information. Data points such as the revenue generated, the number of employees, the number of cities served or couriers on the platform, and anything else in between will be considered.
This analysis, in order to ensure comparability, only looks at competitors in the grocery delivery space. Additionally, only competitors from the United States will be taken into account since this is the only country Shipt operates in.
It should, however, not be seen as a purchase recommendation. It is merely a summary of the competition that Shipt faces as of today.
So, without further ado, let’s take a closer look at the top 12 competitors of Shipt.
1. Walmart Grocery
Headquarters: Bentonville, Arkansas, United States Founder(s): Sam Walton Year Founded: 1962
Walmart is currently the leading grocery delivery service in the United States with a market share of around 48 percent (according to the Second Measure study cited above). Customers can either pick up their order in one of its 4,700+ stores or have it delivered by local, third-party drivers.
Walmart initially launched the service back in 2019 in Kansas City, Pittsburgh, and Vero Beach, Florida. After a successful test phase, it officially unveiled Walmart+ in September 2020. It has since expanded across North America and aims to reach 30 million households by the end of 2022.
The service costs $98 for its annual plan or $12.95 monthly. Apart from groceries, Walmart also delivers pharmaceutical products and conducts repairs. Walmart even delivers when the customer isn’t at home by utilizing a camera that employees wear and use to record the successful delivery.
Its goal with the program is to compete against Amazon’s Prime membership. To compete, Walmart offers a variety of features such as unlimited free deliveries on orders over $35, member prices on fuel at Walmart and Murphy stations, and access to mobile scan-and-go so you can pay as you shop in store.
2. Instacart
Headquarters: San Francisco, California, United States Founder(s): Apoorva Mehta, Brandon Leonardo, Max Mullen Year Founded: 2012
Instacart is one of the leading grocery delivery services in the United States, only trailing Walmart in market share. It partners with grocery chains such as Albertsons, ALDI, Costco, CVS, Kroger, Loblaw, Publix, Sam’s Club, and others. To do that, it taps into a network of more than 100,000 drivers.
In order to get the business, which is currently valued at $24 billion, off the ground, tons of capital was needed. More precisely, Instacart has raised $2.9 billion in funding thus far. Despite internal turmoil, which led to the departure of its founder and CEO Apoorva Mehta, the company is still going strong.
In 2021, it generated revenues of $1.8 billion, up from the $1.5 billion Instacart made in 2020. Close to 15,000 people are employed by the company whose iOS app has been reviewed 2.3 million times. The service is available in more than 5,000 cities across Canada and the United States.
Sources: App Store, Barrons, Crunchbase, Linkedin
3. FreshDirect
Headquarters: Long Island City, New York, United States Founder(s): David McInerney, Jason Ackerman, Joe Fedele Year Founded: 1998
Since 2002, FreshDirect delivers produce across the greater New York City, Philadelphia, and Washington, DC metropolitan areas. It offers instant (2 hours), same-day, as well as next-day delivery.
What’s remarkable about its inception is that it was launched right after the colossal failure of Webvan, the first dot-com era startup that tried to crack the formula of online grocery delivery. Its founders, specifically Ackerman (a former investment banker who specialized in the grocery industry) and Fedele (CEO of Fairway Market), had the necessary chops and foresights to make it work, though.
Over the coming years, the founding team slowly expanded the service areas of FreshDirect. In spite of some legal troubles, which led Ackerman to install his nephew as the CEO of the company, FreshDirect managed to stay relevant – even in the eye of ever-increasing competition in the delivery space.
In November 2020, Netherlands-based food retailer Ahold Delhaize (together with private equity firm Centerbridge Partners) acquired a controlling stake in FreshDirect for about $300 million. The company currently employs 3,000+ people and generates around $600 million in annual revenue.
Its DeliveryPass plan, which is available at different pricing tiers, furthermore grants customers free deliveries and other benefits. Over 6,000+ different items can be ordered.
Sources: Crunchbase, FreshDirect, LinkedIn
4. Stop & Shop
Headquarters: Somerville, Massachusetts, United States Founder(s): Jeanie Rabinowitz, Solomon Rabinowitz Year Founded: 1914
Husband-and-wife duo Solomon and Jeanie Rabinowitz opened their first store in the northern parts of Boston back in 1892. In 1914, they opened the first Economy Grocery Store, which marked the birth of their empire.
It would, however, take almost 30 more years (in 1941) until the business introduced its first Stop & Shop store. Within a span of 18 years, they managed to open 100+ stores. In 1996, the company was acquired by Ahold Delhaize – the same year it began delivering groceries online in partnership with Peapod.
Decades after, in 2020, Ahold decided to shut down Peapod and instead shift its efforts towards the Stop & Shop GO Rewards program. Customers can order online from more than 400 stores throughout the areas of Massachusetts, Connecticut, Rhode Island, New York, and New Jersey.
Stop & Shop Supermarket Co. LLC employs around 60,000 associates. The company, just like FreshDirect, currently accounts for around one percent of all online grocery sales in the United States.
Sources: Stop & Shop
5. Amazon Fresh
Headquarters: Seattle, Washington, United States Founder(s): Jeff Bezos Year Founded: 2007
Amazon Fresh is a subsidiary of the online marketplace giant that includes its own set of retail stores (dubbed Amazon Go) as well as grocery delivery. Prime members, for example, can take advantage of free and same-day delivery.
The delivery service is available across 2000+ cities in the U.S. and the U.K., as well as in selected cities such as Berlin, London, Milan, and Tokyo. In some instances, such as the U.K., it works together with local retail chains to source the groceries. Other times, it delivers from Whole Foods stores, which Amazon acquired back in 2017.
Amazon remains particularly secretive about the performance of its Fresh subsidiary. As a result, it has opted against disclosing much data to the public. Nevertheless, given Amazon’s ambition, capital, reach (through Prime), and ability to repeatedly expand into new business lines, it can be assumed that it already is a significant competitor to Instacart.
Additionally, Amazon continues to launch new physical stores, which will further expand its reach and thus the time it takes to deliver.
Sources: Amazon Fresh
6. DoorDash
Headquarters: San Francisco, California, United States Founder(s): Andy Fang, Evan Moore, Stanley Tang, Tony Xu Year Founded: 2013
While DoorDash is a force to be reckoned with in the restaurant delivery space, its grocery efforts are still fairly nascent. The company entered the space back in December 2021 by introducing express grocery delivery (in under 30 minutes) in partnership with Albertsons Companies.
Given its extensive track record in food delivery, it can be assumed that it will eventually be able to carve out a significant piece for itself. DashPass members, who pay $9.99 per month, can enjoy free deliveries across their orders.
DoorDash, furthermore, has the capital and human resources to get the service up and running quickly. Over two million couriers already deliver for DoorDash (including both food and groceries). An additional 6,000 people are employed by the company on a full-time basis.
Additionally, DoorDash raised $2.5 billion during its startup life and another $3.4 billion when it went public in December 2020. In 2021 alone, the company generated $4.8 billion in revenue.
Sources: Crunchbase, DoorDash
7. Uber Eats
Headquarters: San Francisco, California, United States Founder(s): Uber Year Founded: 2014
Uber Eats is the food delivery subsidiary of the transportation giant Uber. The platform was initially launched UberFRESH and, a year later, renamed to Uber Eats. Uber launched its grocery delivery service during the height of the pandemic in July 2020.
While the Eats business, much like the parent company, has gone through dozens of legal and financial issues in the past, it remains one of the world’s leading food delivery services. Uber Eats is currently available in more than 6,000 cities across 45 countries.
As far as its grocery delivery business is concerned, it has since expanded the service from its testing locations of Miami and Dallas to hundreds across the nation. In July 2021, Uber Eats announced a partnership with Albertsons, which increases its grocery reach to more than 400 cities across the United States.
In 2021, Uber Eats generated $8.3 billion in revenue. The United States naturally remains its strongest market where it accounts for 24 percent of all meal delivery sales (only trailing DoorDash). The service, furthermore, works together with more than 600,000 restaurants. Uber does currently not disclose how much it makes from grocery deliveries.
Sources: Second Measure, Uber
8. Gopuff
Headquarters: Philadelphia, Pennsylvania, United States Founder(s): Rafael Ilishayev, Yakir Gola Year Founded: 2013
Gola and Ilishayev were barely above the legal drinking age when they started Gopuff, a grocery delivery service that operates hundreds of micro-fulfillment centers to serve customers within a matter of minutes. Customers can choose from a selection of 4,000 products.
Much like the other services mentioned on this list, Gopuff also offers a membership that grants customers various discounts and other benefits. In many markets, customers can order 24/7.
Gopuff has certainly transformed the grocery delivery industry, which traditionally relied on restaurant partners to supply the items. Gopuff, in spite of its resource-intensive business model (which you can read about here), has managed to expand to 1,000+ cities in the U.S., U.K., and France – with hundreds more to come.
Investors certainly love what they’re seeing as well. They have poured a combined $3.4 billion into the business, which generated $2 billion in revenue in 2021 alone. It is currently valued at $15 billion and employs around 5,000 people.
Sources: Axios, Crunchbase, Gopuff
9. Grubhub
Headquarters: Chicago, Illinois, United States Founder(s): Jason Finger, Matt Maloney, Mike Evans Year Founded: 2004
Grubhub initially started as a restaurant listing site. Those restaurants would then take care of the delivery themselves while Grubhub comfortably pocketed its commission. In 2015, as a reaction to the pressure that DoorDash and Uber Eats put on its business, Grubhub also entered the food delivery race.
And if that wasn’t enough, it also expanded into grocery delivery. In early 2022, it made two announcements: first, it expanded its partnership with 7-Eleven to offer on-demand convenience delivery from more than 3,000 stores across the nation.
Grubhub also announced a partnership with Russian grocery delivery service Buyk in New York and Chicago. However, after sanctions against Russia, Buyk was forced to terminate the partnership and shut down its business in April 2022.
Grubhub went public back in 2014, which allowed the company to raise $192.5 million (on top of the $84.1 million in equity funding it got before). To remain competitive, it decided to sell itself to Just Eat Takeaway for a whopping $7.3 billion in June 2020. However, Just Eat Takeaway now contemplates selling the business due to decreasing revenue numbers as a result of fewer lockdown measures.
Within the United States food delivery market, Grubhub has a market share of 14 percent (according to Second Measure). Grocery delivery numbers are Just Eat Takeaway said that revenues for its North America division, which mostly includes Grubhub, equaled $2.67 billion in 2021.
Grubhub, furthermore, employs around 6,000 people. It counts 320,000 restaurants as partners and is available in 4,000 cities across the United States. Its iOS app was rated 3.5 million times alone.
Sources: App Store, Crunchbase, Just Eat Takeaway, Second Measure
10. Boxed
Headquarters: New York City, United States Founder(s): Chieh Huang, Christopher Cheung, Jared Yaman, William Fong Year Founded: 2013
Boxed is an online bulk grocery retailer that allows consumers to purchase groceries and others items at wholesale prices. The company also offers an on-demand grocery delivery service dubbed Express in partnership with Costco and Lidl.
While services like Instacart or Shipt score on delivery speed, Boxed is oftentimes significantly cheaper. However, Boxed does not offer a membership, which consequently requires consumers to pay for shipping fees if the order is below $75.
The company has raised $365 million in funding. Another $334 million was netted during its IPO in December 2021. In 2021, the company, which employs over 250 people, recorded $771 million in annual revenues (up 11 percent YoY).
Sources: Boxed Investor Relations, Crunchbase, LinkedIn
11. Misfits Market
Headquarters: Pennsauken, New Jersey, United States Founder(s): Abhi Ramesh Year Founded: 2018
Misfits Market is putting a twist on the grocery delivery game by only selling what it labels ‘ugly’ produce. Its founder started the business after visiting a farm and seeing first-hand how much perfectly edible food is being thrown away by farmers because it doesn’t comply with the requirements of traditional grocery chains.
As a result, Misfits Market is able to offer food at discounts of up to 40 percent. On top of that, it helps to combat food loss, which is equal to about 30 to 40 percent of all food supply according to the U.S. Food and Drug Administration (FDA).
The company charges a flat fee of $5.50 per shipped box. Customers need to order at least $30 worth of food in order to check out.
The firm, instead of relying on couriers, works together with UPS to deliver its items on a weekly basis. Misfits Market is currently available in 44 states across the United States.
Investors have supported the fairly young company with over $526 million in funding thus far. Misfits Market is reportedly valued at $2 billion. Revenue figures are unfortunately not disclosed.
Sources: Bloomberg, Misfits Market
12. Imperfect Foods
Headquarters: San Francisco, California, United States Founder(s): Ben Simon, Benjamin Chesler, Ron Clark Year Founded: 2015
Another service that tackles the ever-increasing problem of food waste is Imperfect Foods. In fact, it helped save over 145 million pounds of food since its inception in 2015. The company, to underline its commitment to sustainable consumption, became a Certified B Corporation in November 2021.
Imperfect Foods currently delivers across most of the West South Central region, Midwest, Northeast, and all along the West Coast. For comparison, Misfits Market is essentially available nationwide across the United States.
Groceries are normally delivered on a weekly cadence. Each week, the company will prefill a customer’s cart with produce it thinks he or she likes (based on previously submitted preferences). Carts can then be adjusted as the customer sees fit.
Despite a tumultuous 2021, which led to the replacement of its CEO, Imperfect Food remains on track to revolutionize the grocery delivery industry. Investors have poured in a total of $229.1 million into the company, which is valued at $700 million, thus far. In 2021, the company generated around $500 million in revenue.
Sources: Biz Journals, Crunchbase, Imperfect Foods
