Save Mart automated ‘dark store’ drives Lucky Now online grocery service

The Save Mart Cos. has transformed a closed Lucky supermarket in Mountain View, Calif., into a micro-fulfillment center (MFC).

Technology partner Fulfil Solutions Inc., a Mountain View-based robotics startup, said Monday that its automation powers a “dark store” opened several months ago that fills same-day delivery and pickup orders for a new Save Mart online grocery service called Lucky Now. DoorDash also is a partner in the Lucky Now service, according to Fulfil’s website.

The service works as follows: Within minutes of receiving an order, Fulfil’s automated system retrieves and sorts the items—ranging from dry packaged groceries to refrigerated and frozen foods—and packs them into bag-toting robots. The bots then ferry the filled grocery bags to a waiting area, where drivers collect them for delivery.

Fulfil noted that its platform leverages artificial intelligence, machine learning, and optical and sensor technologies for automated inventory management and quality control. In the Save Mart MFC, Fulfil’s proprietary dispense stations handle grocery items using computer vision technology, and sensor fusion algorithms confirm that items are packed correctly. The company said its mobile robots split and sequence items to prevent damage and minimize pack time, while the dispense stations redistribute inventory to balance load. In addition, a database tracks every item’s location, origin and expiration, providing real-time inventory management for order accuracy and minimal waste, Fulfil reported.

“The Save Mart Cos. is thrilled to embrace innovative technologies that help deliver on-demand groceries to our customers on their own terms,” Shane Sampson, executive chairman at Save Mart, said in a statement. “With Lucky Now, powered by Fulfil’s robotic automation, we are excited to offer the best value on local and fresh products that our shoppers have come to know and trust.”

Overall, Modesto, Calif.-based Save Mart operates more than 200 stores in California and Nevada under the banners Save Mart, Lucky/Lucky California, FoodMaxx and MaxxValue.

Fulfil said the new MFC in Mountain View marks its first automated dark store. According to the company, the U.S. online grocery market is projected to see annual sales double to 0 billion by 2027, yet the cost to manually fulfill e-grocery orders typical results in a loss, even before including delivery costs. What’s more, Fulfil explained, online grocery service is often expensive for customers, pickup can be inconvenient and product substitutions can occur frequently.

“To address the many challenges facing online grocery, retailers must adopt efficient automation that substantially reduces costs and provides the accuracy, quality and convenience customers expect,” Fulfil CEO and President Mir Aamir stated. “That’s why our fully automated solution represents such a revolutionary step forward. Not only does it make online grocery retailing profitable while meeting customer expectations, but it also prioritizes social and environmental responsibility by cutting carbon emissions, eliminating food waste and enabling healthier food to reach more households at lower cost.”

Fulfil Solutions said the new MFC marks its first automated dark store and noted on its website that DoorDash is one of the launch partners. / Image courtesy of Fulfil Solutions

Fulfil also announced Monday that, in emerging from stealth mode, it recently closed a $60 million Series B round of funding led by venture capital firm Eclipse, with participation from Khosla Ventures and DCVC.

“Today’s online grocery business is built on manual, wasteful and expensive processes,” commented Jay Knafel, early growth partner at Eclipse. “Mir and the team at Fulfil have successfully developed a highly differentiated, full-stack solution to automate the $1 trillion grocery industry by automating all picking and packing.”

Save Mart has been active on the e-commerce front recently. In November, the Western grocer said that Tamara Pattison joined the company in the newly created position of chief digital officer. That announcement came just days after the retailer reported that Save Mart stores in Lathrop and Ceres, Calif., launched two-hour grocery delivery via Amazon, with plans for more locations in California’s Central Valley to soon offer the service. And in May, Save Mart expanded curbside pickup service through Instacart to Save Mart and FoodMaxx banner stores in Nevada.

Robotics technology, too, isn’t new to Save Mart. Just over a year ago, the grocer launched robot-powered online grocery delivery at its flagship Lucky California store in Pleasanton using autonomous vehicles from Starship Technologies. The service made the Pleasanton Lucky California the first San Francisco Bay Area supermarket to use the compact delivery robots from San Francisco-based Starship, the companies said. The launch also marked an expansion of Save Mart’s partnership with Starship, which in September 2020 began e-grocery delivery with its robotic vehicles at the flagship Save Mart store in Modesto.