Discount retailer Aldi enters US grocery delivery market

Germany's Aldi, one of the most recognisable global discount retailers, has announced it will embark on delivering groceries in the competitive US market, in a bid to lock horns with Amazon.

On Monday (14 August), the supermarket chain said it has partnered with Instacart Inc to deliver groceries in three US cities – Los Angeles, Atlanta and Dallas – with the potential of expanding to more cities in the future, upon the successful conclusion of its pilot scheme.

The discount retailer does not offer customers an option to shop on its own website at the moment, so Instacart's online platform will serve as a launch-pad for its American delivery foray.

Aldi has previously said it would invest $3.4bn (£2.62bn) to expand its US store base to 2,500 by the year 2022, up from its current level of 1,600 stores. Its rival and German peer Lidl is also stepping up its expansion stateside.

Instacart charges a delivery fee with the promise of delivering in less an hour. The company, which serves US retailers like Target and Costco, does not hold inventory but rather serves as a pick-up and delivery service.

The announcement comes a matter of months after Amazon acquired upmarket grocer Whole Foods for £10.7bn. Prior to the deal, Whole Foods had been Instacart's client since 2014.