Giant Food gets into online grocery delivery via Peapod

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Internet grocer Peapod and Giant Food, a wholly owned subsidiary of international supermarket operator Royal Ahold, are launching Peapod by Giant online shopping and delivery service in the Washington area. Deliveries begin on Nov. 7. This is the second market expansion for Peapod since Royal Ahold acquired a majority stake in the online grocer earlier this year. Peapod is working closely with Royal Ahold's supermarket brands to expand along the East Coast; in June, service began in southern Connecticut. Peapod said it hopes the supply and services agreement it has with Ahold will give it enhanced purchasing power compared to other online grocers. Peapod by Giant grocery orders will be picked, packed and delivered from a centralized fulfillment center in Gaithersburg, Md. Outside the U.S., Ahold is expanding online grocery service in Argentina, Scandinavia, Thailand and the Netherlands. The company said it expected global sales via the Internet of 250 million euros ($215 million U.S.) in 2000. Peapod has struggled with sagging stock prices and competition from competitors such as Webvan Group. The online grocer's stock fell 6.8% on the news, closing Nov. 2 at $1.28.

Copyright November 2000, Crain Communications Inc.

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