Dive Brief:

• Peapod Digital Labs is working with The Giant Company to pilot automated micro-fulfillment technology at an e-commerce facility the grocer is developing in Philadelphia, the Ahold Delhaize units announced Tuesday morning.
• The Giant Direct facility, located at 3501 Island Avenue and set to open in November, will use robotic picking technology from AutoStore in conjunction with grocery-specific software and pick stations supplied by Swisslog, which will install the system in the 124,000-square-foot fulfillment center.
• ​The Giant Company is stepping up its e-commerce fulfillment capabilities against a backdrop of continuing robust demand for the chain’s online grocery services in the Philadelphia region.

Dive Insight:

Ahold Delhaize’s automated e-commerce project in Philadelphia is part of a broader effort by the Dutch grocery company to improve its online retail operations as it looks to keep pace with other supermarket chains in the United States.

The new facility, which is expected to handle about 15,000 orders per week for delivery to customers’ homes in the city’s Center City and South Philadelphia sections combines technology from AutoStore and Swisslog with proprietary manual-picking capabilities developed by Peapod Digital Labs. Ahold Delhaize said it also plans to move ahead with other MFC tests, including a pilot at a Stop & Shop location in Hartford, Connecticut, that it began in 2019 and others it intends to announce in the coming months.

In September, Texas grocer H-E-B announced a partnership with Swisslog to develop an unspecified number of automated MFCs based on the robotic technology supplied by AutoStore.

The Giant Company facility is taking shape at the same time as Kroger prepares to open the first of a fleet of large-scale automated warehouses across the U.S. in partnership with U.K. grocery automation company Ocado. AutoStore, which is based in Norway, has accused Ocado of infringing on its intellectual property with its robotic fulfillment technology.

Albertsons, meanwhile, is also expanding its investments in micro-fullment technology and expects to have seven such facilities in 2021, the company’s CEO, Vivek Sankaran, said during an earnings call in January.

The Giant Company also announced Tuesday that it is adding geofencing technology to its Giant Direct app. The new capability allows pickup customers to alert associates when they are on the way to a store to retrieve their order. In addition, the grocer also has introduced temperature-controlled pickup lockers to stores in Elizabethtown and Horsham, Pennsylvania.