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Instacart Valued at $10 Billion in Long-Awaited IPO

| Mike O'Brien

Instacart issued its long-expected initial public offering of stock on Tuesday, priced at $30 a share for a valuation of $10 billion, well below the $39 billion it was valued at after a fundraising round in early 2021, but at an offering price low enough to entice retail investors to join the party. The company has been profitable since Q2 2022 despite falling revenue, thanks to various trimming.

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Maersk, Fabric Partner on Automated Dallas MFC

| Mike O'Brien

Danish global shipping and logistics giant A.P Moller-Maersk is jumping into ecommerce fulfillment, opening a micro fulfillment center in Dallas powered by technology from Israeli firm Fabric that will initially serve one client in health and wellness but could be expanded to a multi-tenant operation. The 38,000-square-foot facility will utilize Fabric’s automated storage and retrieval (AS/RS).

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Amazon Posts Strong Quarter on All Fronts

| Mike O'Brien

Amazon posted a blowout Q2, with net sales up 11%, profit doubled from 2022, analysts cheering and an upgraded fulfillment plan refocused on same-day delivery. But Amazon still needs to find ways to improve a grocery business that is getting failing marks from industry observers. AWS growth continues to slow, and management said GenAI won’t contribute meaningfully in the near term.

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E-Grocery Continues to See Pullback

| Mike O'Brien

Two separate reports paint a portrait of the once-robust e-grocery market continuing to face challenges, one that has never been the same since the pandemic lockdowns lifted and consumers returned to physical stores en masse for everyday essentials. It goes against rosy predictions of hockey-stick growth from three years ago, even though gains have mostly held.

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Online Prices See Largest Year-Over-Year Drop Since Pandemic Onset

| Mike O'Brien

Online prices continue to fall as inflationary pressure has eased and retailers discount to clear out stocks ahead of Q4 ordering. Prices were down 2.3% year-over-year in May, the largest drop since the onset of the pandemic, and down 1.2% from April 2023, according to Adobe Analytics. It was good news for consumers but bad news for retail ledgers. Big-ticket categories remain challenged.

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Trader Joe’s on Why It’s Just Not That Into Ecommerce

| Mike O'Brien

Trader Joe’s, the distinctive small-scale-yet-nationwide grocery chain that feels more like a Starbuck’s without the pricey coffee and wifi, has thus far resisted the market pressure to follow the rest of its industry brethren into ecommerce, and explained its rationale in a podcast episode. Hint: it has to do with fulfillment and supply chain costs hitting prices, and maintaining the experience.

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GS1 US Looking for 2D Barcode Champions

| Mike O'Brien

Standards body GS1 US is looking for major retailers and brands to step up and implement its QR-like Digital Link 2D barcode on packages, in order to drive broader market adoption and enable the transmission of richer data that can unlock a trove of value-added services like discounts and offers at checkout.

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Amazon CEO Remains Upbeat as Headwinds Blow

| Mike O'Brien

Amazon CEO Andy Jassy kept a positive tone while running down ways that Amazon has had to scale back its business to accommodate shifting conditions in his second annual shareholder letter, including reducing and reconfiguring its fulfillment network and dealing with a slowdown in cloud computing. The company is also trying to figure out a physical grocery model that works, Jassy said.

Grocers Fear Digital is Eroding Customer Loyalty

| Mike O'Brien

Grocers are increasingly concerned with the impact of the digital age on customer loyalty, as options have proliferated and made it easier for shoppers to cross over to competitors, according to a new report from Incisiv, The Food Industry Association (FMI) and Loyal Guru. About 75% of grocers said e-grocery has made shoppers less loyal, while 71% report that improving loyalty is a C-level issue.

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Boxed Files for Chapter 11 Bankruptcy

| Mike O'Brien

Boxed, purveyor of bulk home products that likened itself to an online Costco, filed for Chapter 11 bankruptcy protection after failing to find a buyer and enduring sustained weak revenue and earnings, a far cry from the promise of its SPAC IPO in December 2021. An affiliate of its main creditor may purchase its software service.