GROCERIES TO GO GOES OUTSIDE FOR HOME-DELIVERY TEST

LINDA PURPURA

MEDFORD, Mass. -- Groceries to Go here, an on-line grocery retailer, is testing a home-delivery option using a third-party provider with expertise in delivering dairy goods in New England.

The home-delivery test began earlier this month in the suburbs west and southwest of Boston and will run through 1997, said David Cuthbert, president of Groceries to Go. The company will look at possible expansion of home shopping in 1998.

Groceries to Go charges a $1 delivery fee for orders of at least $40. No home delivery is available for orders under $40.

"We want to offer a service with as few obstacles as possible between us and the customers," Cuthbert said. "And certainly a high delivery fee is a barrier. Some of the other services have historically had very high fees, such as a percentage plus a fixed fee on top of the order."

Previously, Groceries to Go customers picked up their orders at a drive-through, located at the 4,000-square-foot facility here where orders are assembled. The retailer is supplied by the wholesale division of Star Market Co., Cambridge, Mass., as well as by produce and meat suppliers and direct-store-delivery vendors, among other sources.

Groceries to Go will continue to offer customers the option of picking up their groceries at the drive-through, in addition to the home-delivery service.

"We've chosen to outsource the delivery to a company that is very well regarded in the food-delivery business," Cuthbert said, declining to name the third-party company.

"It doesn't make sense financially at this point for us to invest large amounts of resources to building our own distribution network if we can take advantage of other businesses out there," he added.

"We expect home delivery to significantly increase our customer base," Cuthbert said. He declined to elaborate on the number of customers using its services, but added that offering home delivery would help Groceries to Go expand its customer base by keeping it competitive with other home-shopping programs in the area.

Boston is a hotbed for home shopping, with programs from Hannaford Bros., Scarborough, Maine; Streamline, Westwood, Mass.; and Peapod, Evanston, Ill.

Groceries to Go has been operating for the past year. The company only receives orders via the Internet. It does not take orders by phone or fax, and charges no membership fees.

"We are the smallest of the home-shopping companies but we are exploring a number of different options to see what's most attractive to the marketplace,"

Cuthbert said. "We continue to look at the drive-through concept for expansion to new locations."

Cuthbert added that Groceries to Go views supermarkets as potential partners, and looks forward to expanding its concept regionally and nationally.