Dive Brief:

• Giant Food plans to close three regional e-commerce distribution centers this fall as part of an effort by the mid-Atlantic grocery chain to provide delivery services using a “localized fulfillment model,” Giant spokesperson Jon Arons confirmed Monday.
• The affected facilities, all of which will cease operations on Oct. 21, include order-assembly centers in Hanover, Maryland and Manassas, Virginia, as well as a smaller facility in Milford, Delaware that serves as a cross-dock, Arons said.
• Giant’s decision to close the facilities comes less than four months after the retailer announced it had opened the Manassas site to expand its delivery footprint and improve service for online shoppers.

Dive Insight:

Giant Food’s move to shake up its e-commerce operations reflects the company’s conclusion that it needs to rethink how it fulfills delivery orders to accommodate what digital shoppers expect, according to Arons.

“Our ambition at Giant is to meet the changing needs of our delivery customers, who are increasingly looking for faster delivery, more delivery time slots and a broader assortment. We are adapting our operating structure to better meet these needs,” Arons told Grocery Dive.

Washington, D.C., radio station WTOP first reported Giant Food’s decision to close the facilities.

Arons said Giant does not expect the closures to disrupt delivery service for its shoppers but declined to provide details about how the Ahold Delhaize-owned supermarket chain plans to modify its delivery-fulfillment operations.

“Grocery delivery is still an integral part of our omnichannel growth strategy, which strives to meet all the ways customers want to shop,” Arons said, adding that Giant’s in-store pickup operations will not be affected by the changes the company is working on.

Giant finished notifying associates across the company about the impending closures last Wednesday and is allowing the approximately 400 employees whose jobs are impacted by the changes to apply for roles in other parts of the company, Arons said.

Arons declined to comment on whether the closure of the Manassas center would affect Giant Foods previously announced intention to use the 82,000-square-foot facility to provide delivery of goods from local suppliers.

When the grocer began operating the center in May, it highlighted plans to use the site to make an assortment of local goods from companies in Virginia, including dessert maker Don’t Forget Cake and The Perfect Pita, a restaurant and catering company, available to online shoppers. Giant Food announced at the time it planned to stock the facility with beer and wine from producers, including local beverage companies Port City and Solace Brewing.

The 150,000-square-foot Maryland e-commerce site Giant Food will close has been in operation since 2019, when the company launched its Giant Delivers operation as the successor to the company’s former Peapod by Giant grocery delivery service.