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NEW YORK — Ahold Delhaize USA is selling its FreshDirect online grocery business to Getir, the world’s first ultrafast grocery delivery service.
“With this decision, we will increase our focus on omnichannel — our biggest growth opportunity,” said JJ Fleeman, Ahold Delhaize USA’s chief executive officer. “This was a difficult decision, especially given FreshDirect’s rich history in the New York City area.”
FreshDirect helped pioneer what it called the short supply chain. The business launched more than two decades ago as a concept for bypassing stores in order to get fresh food quickly, sourced directly from farmers, fishermen and producers into consumers’ kitchens. The company sought further differentiation by nudging its customers toward food that is at least partly prepared, and by presenting hundreds of recipes on its website to guide customers’ shopping decisions.
Ahold Delhaize USA acquired FreshDirect in 2021.
Istanbul-based Getir was founded in 2015 and operates in Turkey, the U.K., Germany, the Netherlands and the U.S. Demand for its services surged during the pandemic but declined after lockdowns ended and shops, bars and restaurants reopened. Getir last summer announced it was cutting 11% of its workforce and exiting Portugal, Spain and Italy. Getir said the FreshDirect acquisition will increase the quality and breadth of its products, especially in fresh food, and advance its ambitions to grow in the U.S.
Ahold Delhaize, the Dutch parent of U.S. grocers including Stop & Shop, Food Lion and The Giant Co., reported U.S. net sales of $14.5 billion in the third quarter. That’s an increase of 0.5% at constant exchange rates but down 7.1% at actual exchange rates.
U.S. same-store sales (excluding fuel) increased by 0.9%. Online sales rose 4.4% in constant currency, driven primarily by double-digit growth at its Food Lion and Hannaford banners.
“Inflation, increasing interest rates and changes in U.S. government support remain tangible headwinds and are creating anxiety for many customers,” said Frans Muller, president and CEO of Ahold Delhaize.
Added Muller, “The reduction in emergency federal Supplemental Nutrition Assistance Program (SNAP) benefits, higher interest rates and the resumption of student loan repayments in October continue to weigh on customer sentiment. On its own, the reduction in SNAP benefits resulted in approximately a four percentage-point headwind to sales growth in the third quarter.
“While we were able to offset a large portion of this headwind through our strong value propositions and ongoing momentum in online sales, the dilutive impact of a changing sales mix and increasing shrink contributed to slightly lower-than-expected U.S. margins. With the help of measures we are putting in place through our Accelerate initiatives, in-store actions to reduce shrink and further volume support incentives from vendors, we expect this modest margin pressure to be transitory and pass in a couple of quarters.”
Ahold Delhaize said it is adjusting its full-year earnings forecast, now slightly below 2022 levels, due to reductions in federal government support having a slightly greater impact on its brands’ operations than originally expected.
Ahold Delhaize announced during the third quarter that it is acquiring Profi Rom Food SRL, a Romanian grocery retailer that operates 1,654 stores in Romania and has a reputation for providing value and a strong assortment to its customers. The deal provides Ahold Delhaize with a strong format fit and a complementary customer proposition to its Mega Image brand in the Romanian market, the company said last month in announcing it had reached agreement with the seller, Bucharest, Romania-based private equity firm MidEuropa SRL.
