Whole Foods to go chainwide with new grocery delivery fee

Whole Foods Market online shoppers are set to lose a key perk of their $119-per-year Amazon Prime membership: free two-hour delivery of groceries on orders of at least $35.

Starting Oct. 25, parent company Amazon plans to charge a $9.95 fee for Whole Foods delivery orders chainwide, with additional rush fees for one-hour delivery orders. The change will come less than two months after Amazon announced a test of a $9.95 fee for two-hour deliveries — including Prime member — in six metropolitan markets.

Amazon had notified Whole Foods customers of the pilot for delivery charge — described as a “service fee” and due to kick in Aug. 30 in selected cities — in an email and an online in an FAQ. The FAQ now says the $9.95 delivery fee will be instituted across Whole Foods, though at the time of test Amazon didn’t report whether the fee would be expanded to more market areas.

“Starting Oct. 25, 2021, a service fee will be implemented on Whole Foods Market delivery orders,” Amazon said in the FAQ. “Currently, the service fee is included on delivery orders in Portland, ME; Providence, RI; Manchester, NH; and the greater Detroit, Boston and Chicago areas.”

Amazon noted that the fee will support rising costs for delivery amid elevated online order volume and basket sizes among Whole Foods customers. In addition, the company said Whole Foods is refocusing on in-store investments as more customers return to in-store shopping.

Related:Whole Foods Market to pilot new grocery delivery fee

“The service fee helps cover operating costs, including equipment, technology and other costs associated with your grocery delivery order, so we can continue to offer the same competitive everyday prices in-store and online at Whole Foods Market,” Amazon said in the FAQ.

The new delivery fee won’t affect click-and-collect, as one-hour grocery pickup at Whole Foods will remain free for Prime members on orders of $35 or more, according to Seattle-based Amazon. Two-hour delivery and pickup for orders of at least $35 also will remain free for Prime members at Amazon Fresh supermarkets, the FAQ said.

In late October 2019, Amazon shook up the online grocery arena when it announced Amazon Fresh perishables delivery as a free service under the Prime customer benefits program. With the move, Amazon essentially made all of its same-day, online grocery delivery — including for Whole Foods — a free service for Prime members placing orders of at least $35. Amazon’s Prime Now and Prime Pantry programs already offered members free delivery for that order minimum. Prime members seeking faster service, such as one-hour delivery and 30-minute pickup, pay an extra fee.

Related:Amazon to phase out Prime Now banner for same-day delivery

Overall, Austin, Texas-based Whole Foods operates 505 U.S. stores in 43 states.