The Checkout: Walmart and Target Q2 Earnings, DoorDash Adds Grocery Stores

Welcome to The Checkout: an express lane for the weekly news you need to know, always 10 items or less.

Walmart and Target Report Q2 Earnings

Walmart and Target this week reported their second quarter earnings with company executives from both retailers detailing plans to improve their store pickup and delivery programs.

Target saw its strongest quarter on record, the company reported, with year-over-year sales growth of 24.3%. In a presentation Wednesday, chairman and CEO Brian Cornell noted that Target’s branded food and beverage business grew over 30% this year and that private-label brand Good and Gather, which launched almost a year ago, generated quarterly sales of over $1 billion.

“Good and Gather brand is clearly resonating with our guests and delivering on our food and beverage vision to enhance the Target experience by making it easy for families to discover the joy of food,” Cornell told investors.

Most of the quarter’s sales growth was generated in-store (90%) as traffic increased during the spring and summer, he noted. Same-day pickup, drive up and Shipt sales also grew 273% year-over-year — Target recently added fresh, refrigerated and frozen food and beverage products to these services in over 1500 stores. Additionally, ecommerce sales were up 195% in the quarter, with 10 million new online shoppers during the first half of 2020.

Walmart, meanwhile, saw its U.S. business’ sales grow 9.3% during the quarter, fueled by “general merchandise” and food, the latter of which increased by $3 billion in sales. Additionally, ecommerce sales grew 97%, and the company is preparing to roll out an online membership platform, Walmart+, which CEO Doug McMillon said will include quicker delivery options. The retailer has been testing the service with groceries since last year and has since added more categories. McMillon did not announce a launch date for the platform.

“We think that assortment breadth and our ability to deliver with speed nationally, combined with a few other benefits for customers, will result in a compelling proposition,” McMillon said.

Walmart also this week extended store hours to 10 p.m. in 4,000 locations after reducing them in March.

Propeller Industries Gains Investment From Newlight Partners

Financial and accounting services provider Propeller Industries this week announced new funding from private investment firm Newlight Partners. Terms of the deal were not disclosed.

Propeller will apply the funds toward expanding its technology platform and supporting future acquisitions. Founded in 2008, the company provides high-level financial guidance, reporting and accounting services to over 300 early-stage companies, as well as specialized services including trade promotions management and human resources. These efforts allow emerging brands who have outgrown “basic bookkeeping” services to outsource their CFO, accounting or finance roles without having to bring on full-time staff members.

Propeller’s clients, which have included food and beverage brands Sir Kensington’s, Krave Jerky and Super Coffee, have raised over $6 billion in capital since the company launched.

“Today represents an exciting new chapter,” Chris Fenster, Propeller founding partner and CEO, said in a release. “Most importantly, Newlight shares our vision for the future and recognizes our strong culture and commitment to helping great entrepreneurs build great companies.”

DoorDash and Shipt Add New Grocery Delivery Options

Online delivery platform DoorDash, which previously focused on delivering from restaurants, this week announced the launch of grocery delivery, with over 10,000 products that are available in under an hour.

DoorDash already delivers larger orders, such as corporate catering, from grocery chains via DoorDash Drive. More recently it added convenience stores such as CVS and Walgreens. The new grocery shopping service will be available to over 75 million users, according to a company blog post, beginning with retailers Smart & Final in California and Meijer and Fresh Thyme in Chicago, Cincinnati, Milwaukee, Detroit and Indianapolis. Additional regional grocers, including Hy-Vee, Gristedes and D’Agostino, will join the app in the coming weeks, the company reported, and premade meals sold by grocery stores will be available as well.

“This is another tool that allows our customers timely access to the fresh offerings that we provide at Hy-Vee,” said Tom Crocker, Hy-Vee’s SVP of ecommerce. “This new service helps us grow our grocery business while meeting the needs of our shoppers who are on-the-go.”

Additionally this week, retailer marketplace Shipt — which partners with stores including Target, Central Market, Fresh Market and Meijer — launched one-time ordering, having previously required a membership to use the platform. Customers can now buy shopping passes for one, three or five orders for $10, $9 or $8 per delivery, respectively. During a test run of the new offering earlier this year, the company saw a 25% increase in new customers.

“The challenges consumers have faced during the pandemic further strengthened our resolve to make Shipt as accessible to as many customers as possible,” CEO Kelly Caruso said in a release. “This has been a meaningful option for both new customers as well as those that are new to grocery and essential delivery services.”

Food Waste Coalition Launches

Global industry network the Consumer Goods Forum (CGF) this week launched the Coalition of Action on Food Waste, led by executives from 14 of the largest retailers and food companies in the world.

The initiative builds upon CGF’s Food Waste Resolution, a 2015 plan to reduce waste from 400 retailers and manufacturers by half. According to a release, food waste costs the global economy $940 billion yearly and adds 3.3 billion tons of greenhouse gas emissions to the atmosphere.

The coalition’s founding members include retailers Ahold Delhaize and Walmart as well as General Mills, Kellogg Company and Nestlé. In the program, participating companies commit to reporting food loss data by 2021, adopting sustainability coalition Champion’s food waste plan across their supply chains and helping prevent food waste that occurs right after food is harvested. They will also create regional working groups to combat these issues.

“Food loss is a serious global problem and it can only be effectively addressed through committed collective action,” Ignacio Gavilan, CGF director of environmental sustainability, said in a release.

CGF members include executives from 400 retailers, manufacturers, service providers and other industry stakeholders across 70 countries. The network’s other campaigns include food safety and plastic waste reduction.

Partake CEO Featured in Music Video

Denise Woodard, founder and CEO of allergy-friendly cookie brand Partake Foods, appears in recording artist Pharrell Williams’ new video for “Entrepreneur,” a song featuring rapper Jay-Z, an investor in the New York-based brand.

The video points out that “86 investors told Denise Woodard of Partake Cookies, ‘no’ — Except Jay-Z.” Also featured in the video are 35 Black entrepreneurs including Percell Keeling, owner of Los Angeles-based Simply Wholesome Health Market, and Alisa Reynolds, owner and chef of health-conscious soul food restaurant My Two Cents.

“If you had told me in 2016 when I had the idea for Partake that four years later, our products would be in over 2,700 stores and I would be in a Pharrell and Jay-Z music video, I wouldn’t have believed you,” Woodard wrote today on LinkedIn. “But it’s true and an incredible pinch me moment.”