Proposed SNAP Cuts Imperil Deliverers & Needy Americans
Zoomo + DoorDash Canada, Instacart launches Fizz, Sweetgreen same store sales slump
Woh oh woh do we have some big news this week… momentous policy shifts, cool new products, juicy earnings reports and another e-bike partnership. And if that wasn’t enough, did you catch last week’s deep dive into DoorDash, Uber Eats and Grubhub funding updates, or our interview with Kiwibot’s Co-Founder Felipe Chavez about the company’s relaunch?
Today:
SNAP Cuts Would Hit 3PDs & Hungry Americans
Zoomo and DoorDash Zoom and Dash into Toronto
Chart Time | Stick a Fork in Sweetgreen?
Will Instacart Fizz-le without Fidji?
POLICY | 20% Cuts to SNAP Would Be Disastrous
In their zeal to find billions in “savings” to offset proposed tax cuts for the wealthy, congressional Republicans have proposed cutting funding to the Supplemental Nutrition Assistance Program — aka food stamps — by $230 billion over 10 years. That represents ~20% of the program’s budget, and would be the largest cut in USDA history. SNAP accounts for about 4% of the total U.S. food spending, totaling $112.8 billion, and keeps millions of the neediest Americans healthy and fed. With that in mind, the National Grocers Association, representing ~22,000 U.S. stores, has come out against the move. Strangely, the 3PDs have kept mum on the subject; when reached for comment, DoorDash said they “don’t have anything to share at this stage” and Uber did not respond.
The Big Picture: As we’ve tracked, the delivery apps have made a big push to serve SNAP / EBT users, as they look to tap into the grocery needs of 42 million Americans. Grocery has grown into a huge segment for the 3PDs: SNAP accounts for 4-7% of Instacart sales, while 1.8 million DoorDash users have SNAP / EBT cards, and Uber just celebrated hitting a $10B run-rate for grocery & retail, with its relatively recent SNAP push helping grow that segment. The 3PDs need to stand up for these needy Americans, as well as their own bottom lines, this is no time for equivocation…
VEHICLES | DoorDash Takes Discounted Zoomo E-Bikes to Toronto
DoorDash is launching a new pilot with Zoomo, taking the latter’s courier-focused e-bikes to Toronto. This “Dash to Deals” pilot will offer up to 100 Canadian Dashers discounted rental rates on their e-bikes, with subsidies increasing as the number of deliveries completed goes up. Dashers making 60 or more deliveries per week can rent a Zoomo e-bike for as little as $14 CAD ($10 USD) per week, a 70%+ discount.
The Big Picture: Zoomo seems to have found its footing after a rocky over-expansion led to quick cutbacks. DoorDash and Zoomo have already teamed up in Australia, Zoomo’s home turf, although their collaboration there doesn’t feature this incentivized discount structure. DD has a few other e-bike partners, including Whizz in NYC, Philly, DC and Chicago, and Dirwin in LA + Chicago. Zoomo also works with Uber Eats in NYC.
CHART TIME | Sweetgreen Stock Plummets as Sales Slow
Tech-forward salad chain Sweetgreen saw its stock fall nearly 30% after weak Q1 results noted a 3.1% same-store sales decline. The LA-based company had previously only seen same-store sales growth since going public in 2021. On the tech front: Total Digital Revenue Percentage hit 59.9% and Owned Digital Revenue Percentage sat at 31.9%, versus 58.9% and 32.8% in the prior year period; the company expects the relaunch of its loyalty program in Q2 to further improve those numbers. Being a growth stock truly is a double edged sword (or fork, we suppose…)
PRODUCT | Now-Leaderless Instacart Launches Fizz for Group Orders
Ever feel like party planning is a chore? Instacart hopes to solve that problem with the launch of Fizz, a new app and mobile website for group ordering. Instacart has teamed up with event invite platform Partiful, creating an elegant solution that works like this (millennial friendly text theirs):
Start a party cart and pop the link into your group chat
Your friends can add their favorite items to the cart and see what’s already been added, even if they don’t have the Fizz app
Everyone pays for what they add — no bill-splitting math required
As the host, you call the shots: you decide when to place the full order, and get it delivered immediately or scheduled to show up in time for your party
Your shopper will deliver your drinks and snacks and check your ID for orders that include alcohol — then the party’s on!
The Big Picture: This launch comes at an odd inflection point for Instacart. While the company just saw record revenue, it’s lost the leader that turned the company around after its founder left: Fidji Simo just jumped ship to OpenAI, where she’ll serve as CEO of Applications. Partiful’s having a bit of executive drama too, with New York Mag digging into her earlier work at defense contractor Palantir. (We’ll give props to Shreya Murthy for firing back that glossy mags should be just as nosy when talking about book publishers like Simon & Schuster — all of the big five publishers have specialty imprints that specialize in noxious political titles.) Both Instacart and Partiful will need to keep their remaining leadership on point, as Fizz has already been sued over trademark concerns.
A Few Good Links
Amazon faces dilemma over DD+Deliveroo deal. Rite Aid bankrupt again. Kiwibot leaves Findlay University amid Sodexo shakeup. Uber pushes workers back to office. DD spends big on NYC elections. Conservative-themed nicotine pouch brand Alp partners with Gopuff. USPS loss widens as new Postmaster joins. Papa Johns’ net income droops, as does RBI’s. Indian electric two-wheeler Ather goes public. Right-sized e-pickup maker Slate confirms $700M in funding. DoorDash launches local biz accelerator. Grubhub pushes back against Seattle’s PayUp rules, brings back Gold Days of Grubhub+, partners with Extended Stay America. U.S. and China lessen tariffs for 90 days. U.S. infrastructure gets higher grades thanks to Biden initiatives. Delivery-focused brands say reliability trumps speed. Deliveroo partners with KFC. USDOT dolls out 180 grants. NYC expands weigh-in-motion program for freight trucks. How an upscale Italian resto uses delivery. Vietnam’s Sendo uses local fridge space as makeshift cold-chain delivery network. Toast and Yelp Q1s. EU launches Next Generation Sustainable Electric-vehicle Ecosystem for Delivery.
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