USPS says its entry into grocery delivery market will not have significant impact on smaller firms

In a filing submitted to the Postal Regulatory Commission (PRC) yesterday (22 July), the US Postal Service (USPS) said that it does not expect that its entry into the US grocery delivery market will have a significant impact on the smaller courier firms already active in the field. As previously reported, USPS began working with Amazon Fresh on grocery deliveries last year and announced its intention to expand the trial service to the New York metropolitan area at the end of June.

The PRC was concerned that USPS involvement in the market might threaten the commercial viability of smaller retailers and specialist grocery delivery companies. The Commission therefore requested that USPS “assess the impact of the expansion on small business concerns” by looking at the New York City metropolitan area as a test site.

In its filing, the USPS reported: “There are several firms within the New York City metropolitan area that offer a range of products for in-home delivery, including Fresh Direct, Amazon Fresh, InstaCart, and Peapod. The market for grocery delivery is emerging rapidly, with several companies already established in the market, and others looking to enter the market in the near future.”

After listing the firms’ pricing structure and delivery arrangements, the USPS filing concluded: “The Postal Service … expects the prices offered by small businesses in this market are comparable to the price range offered by the Postal Service through this market test and by larger grocery delivery firms. These courier services already compete with existing retail grocery stores and larger firms, so the Postal Service does not expect its entry into this emerging market will have a significant impact on these smaller firms.”

Click here to view the USPS filing.