Google is expanding its same-day delivery service to fresh groceries, the latest example of the tech titan’s increasing push into consumers’ daily lives.
Google said it would begin delivering produce, meat, eggs and other perishable goods on Wednesday in parts of San Francisco and Los Angeles. The service is part of Google Express, which partners with retailers in some U.S. cities to deliver goods to consumers within hours of an order.
Like many recent Google initiatives, including Internet-connected thermostats and high-speed Internet service, food delivery poses sometimes trickier problems than searching the Web. Fresh-food delivery in particular is a well-stocked field that has yielded few profits.
Competitors include Amazon.com Inc., Instacart Inc., Fresh Direct LLC and Safeway Inc. But they and others have struggled to make money, in part because of high delivery costs and historically low profit margins of about 2% on grocery sales. In an earlier era, when Internet service was slower and spottier, Webvan Group Inc. burned through $800 million before filing for bankruptcy in 2001 and ceasing operations.
While Amazon and Fresh Direct maintain expensive refrigerated warehouses near cities, Google says it will make deliveries directly from its existing retail partners. That will avoid the risks of owning its own inventory, like food spoilage.