I’ve been using Instacart for grocery shopping pretty extensively since the pandemic started and have been mostly happy with their service. But a couple of days ago something happened that makes me question their integrity.
I placed an order for 12 items from Safeway. The order was delivered, but one item was missing. Not unusual; I usually report a missing item to Instacart and they credit me for it. But while searching the bags for the item, I found the paper Safeway receipt, which I normally don’t receive when I do an Instacart order. I confirmed that the missing item was not on the Safeway receipt, but then I noticed something more disturbing.
Almost every item on the Safeway receipt was priced lower than the corresponding item on the receipt on the Instacart web site. The total on the Safeway receipt (what Instacart paid for my groceries) was $67.23; the total on the Instacart receipt (ignoring the missing item and the disclosed Instacart fees) was $76.27. For example, a bag of potatoes: $2.99 on the Safeway receipt, Instacart claims they cost $3.59; a bag of chips: $5.99 on Safeway, $7.09 on Instacart; a bottle of almond milk: $3.99 on Safeway, $4.69 on Instacart; etc. right down the line.
My wife was furious and called Instacart. I didn’t hear the conversation, but she said that the agent said that Safeway sets the prices, not them (which makes no sense) and that at one point the agent said “this is why we don’t give the paper receipts to the customer”. So it seems that the company policy is to hide the store receipts from the customer, and in this case the shopper screwed up by leaving the receipt in the bag.
I don’t mind paying the usual Instacart fees and the shopper tip, which are disclosed when placing the order, but this seems like outright deception. It seems that they are buying the items at a certain price and lying about what they paid for them. Does anyone have a different view of this?
I think this is to be expected. I know when I order a meal for delivery from Doordash/Uber Eats/Grubhub/whatever, I’m paying over and above what it would cost me to buy it directly.
Isn’t that how all those delivery services operate?
If you look at the actual menu prices for items, Grubhub always lists them for like $1 higher. They still have the nerve to also charge extra fees as well, which is why I never use services like this. They are all ripping you off.
I’ve seen similar behavior from Costco and BJ’s. If you order from them online, the prices for each item are higher the in-store price. And they then tack on a delivery fee.
I’m pretty certain Safeway offers curbside grocery pickup, use the Safeway app to shop without extra fees. Drive to store, park and they’ll load your groceries Maybe they deliver for free or small fee.
That’s what my grocery does and we have used the service since the pandemic. They add $1 to the grocery list for the service and for $10 they will deliver. I add a $5 tip.
Likely the per-item prices are higher than in-store, when doing this; we used curbside pickup for quite a while during the pandemic, and when I started going into the store again, I compared prices and they were 10-20% higher. There was no fee, as such, just that markup.
I suspect that, as others have noted, Instacart has their own markup on stuff. The shopper has to go through the regular checkout line, and likely pays the in-store prices, and Instacart pockets the difference. The agent was likely telling the truth that this is why they don’t give paper receipts.
Not a scam, per se, but part of their profit model. Look at it this way: If you are paying 10-20 bucks fee for the service, is that really enough to cover the shopper’s time and delivery costs?
If that’s the case, it may explain why the OP was told by Instacart that “Safeway sets the prices.” It would be interesting to compare the in-store price vs the curbside pickup price vs the delivery price when ordering through Safeway and not Instagram.
You shop on the Instacart website and the underlying store prices are marked up 15-20%, which Instacart keeps. Underlying store hopes you don’t notice. Often this means you don’t get some of all of the “specials” in the store.
You shop on the store’s own website and choose delivery. You might be charged a delivery fee, which may or may not be the same as the fee that Instacart charges the store. If the store has high margins, they may not charge a delivery fee and simply share some of their margin with Instacart.
The same retailer may have multiple arrangements with Instacart for where the order is placed (on Instacart or Store website) and how the order is “picked” (by store employees or Instacart “shopper”). Even in the same store!
They present that you are shopping at Safeway, “Safeway sets the prices” but on the back end Safeway is passing 75%-100% of the markup over store shelf prices to Instacart as a fee. It’s a wink-wink-nod-nod arrangement.
But you can’t cheat an honest man. People want free delivery on relatively low value, low margin, bulky goods. How do you think the cost of selection and delivery is covered. By the investors?
I don’t understand the idea that Safeway charges higher prices for Instacart orders. First of all, how do they even know that a particular shopper is buying for Instacart? Do Instacart shoppers have to tell the cashier that they’re shopping for Instacart? In that case, why couldn’t an IC shopper just pretend to be a normal customer, pay the lower prices, and pocket the difference between that and what IC thinks they paid? And what about that paper receipt I got with the lower prices? Does Safeway charge the shopper higher prices but print a fraudulent receipt anyway, which under normal circumstances the end customer never sees anyway? This doesn’t make sense to me.
Instacart agrees that Safeway will set the prices on the “Safeway store” on Instacart. Instacart then agrees to charge Safeway a service fee. They pretend that these are independent. Instacart then pays over to Safeway the difference between the price paid by the customer online, and Safeway pays Instacart the service fee.
e.g. (oversimplified)
Safeway marks up all prices by 20% on the Safeway store on Instacart. It may even be a “white label” Instacart website where the Instacart name only appears in tiny print if at all, and you are on something like “https://shopathome.safeway.com”
Online shopper goes on the site and buys $96 of items that would have cost $80 in the store. Customer pays Instacart $96.
Gig shopper gets the order and drives to Safeway with an Instacart debit card. Buys the products and pays $80.
At the end of the week, Instacart pays Safeway $16, maintaining the fiction that Safeway is setting the prices, so that Safeway does indeed collect the whole $96.
In a COMPLETELY SEPARATE transaction Safeway pays Instacart 17% of the gross sale value as a service fee for order processing, shopping and delivery. That’s $16.32.
This has NOTHING WHATSOEVER to do with the $16 that Instacart paid Safeway a couple of milliseconds ago.
Several months ago I decided to use Instacart to place a grocery order at Wegman’s so I could take advantage of some loyalty customer sales. Except that when I started placing the order I was not being given the sales price on anything. A search of the Instacart site brought up the fact that even though they supposedly had my loyalty card info for a store they were not required to honor those prices. I canceled the order.
Oddly enough, recently I was able to place a delivery order at a different store (Food Lion) and did get the weekly sales prices.
I deal directly with my grocery store Meijer, I use their shopping app and whether I go inside to shop my own list that I created on the app or use the list for curbside delivery the prices are the same.
Now I’m not able to buy everything thing in the store for curbside pickup. Some things are instore deals only or they don’t list every oddball item on the app. But nearly everything else is available. I can’t speak to their homegoods or clothing merchandise availability on the app.
I’m pretty sure I did. It’s possible, come to think of it, that I might have placed the order directly from Food Lion instead of Instacart. I don’t do a lot of grocery delivery, since going out to shop is one of the few times I get out of the house (the other times being doctor appointments). But occasionally I will realize that I’m out of something and don’t want to make a special trip, or there’s something on sale.
Despite the constant emails and other reminders I’m constantly getting, I have never tried to get groceries using DoorDash or Uber.