Instacart Inc., the San Francisco-based grocery shopping and delivery service, is reportedly planning to utilize robots in order to carry out its shopping needs and cut costs.
As reported by Bloomberg, the outlet reviewed documents that explained the company’s plan, which “involves building automated fulfillment centers around the U.S., where hundreds of robots would fetch boxes of cereal and cans of soup while humans gather produce and deli products. Some facilities would be attached to existing grocery stores while larger standalone centers would process orders for several locations, according to the documents, which were dated July and December.”
The documents reportedly revealed various information, including the fact that the company was planning to start the process of trying out the fulfillment centers later this year. According to sources familiar with the issue, however, Instacart is behind schedule. “And though the documents mention asking several automation providers to build the technology, Instacart hasn’t settled on any, said the people, who requested anonymity to discuss a private matter. In February, the Financial Times reported on elements of the strategy and said Instacart in early 2020 sent out requests for proposals to five robotics companies,” the outlet reported.
The process of paying gig workers to carry out the shopping is expensive for the consumer. Bloomberg noted, “Delivery fees, price markups and tips add as much as 25% to what shoppers pay for a typical Instacart grocery order, said Marc Wulfraat, president of the logistics consulting firm MWPVL International Inc., essentially making it a boutique service for the affluent.”
“There’s a hefty price for this convenience we all love so much,” Wulfraat said.
Bringing robots into the process would slice the costs, which might provide an opportunity for Instacart to broaden its reach and become more attainable for a broader range of people.
An Instacart spokeswoman did not give details but said the company is “committed to supporting our brick-and-mortar partners and continuing to invest in and explore new tools and technologies that support the needs of their customers and further enable their businesses to grow and scale over the long-term.”
Instacart’s possible strategy shift comes at a time when companies are trying to adjust to the market and the ever-present potential of a mandated minimum wage hike. The Biden administration has made efforts to increase the federal minimum wage in recent months and Democrats in Congress also tried to boost the minimum wage, which critics say can lead companies to automate their services rather than pay workers.
As Daily Wire Editor Emeritus Ben Shapiro discussed in his “Debunked” article on the minimum wage, “The Congressional Budget Office recently evaluated Joe Biden’s plan for a $15 federal minimum wage, and what they found is that over the course of the next few years, it would improve the salaries for some 900,000 people, but it would put 1.4 million people out of work.”
“The reason being that when you artificially boost the price of labor, people don’t just magically come up with the money. Instead, they fire a bunch of people, or they automate a bunch of those jobs. The people who retain their jobs make the higher minimum wage. Everybody else, again, they make Thomas Sowell’s minimum wage of $0,” Shapiro added.
In a statement to The Daily Wire, an Instacart spokesperson said, “We’re constantly exploring new tools and technologies that support the needs of the 600 retailers we partner with and further enable their businesses to grow and scale over the long-term. Shoppers are and will continue to be central to Instacart and our service, and any suggestion otherwise is wholly inaccurate.”