SpartanNash to open its first micro-fulfillment center

Later this month, SpartanNash plans to launch its first micro-fulfillment center to fill orders for its Fast Lane online grocery service.

The grocery distributor said Wednesday that it plans to hold a grand opening for the 55,000-square-foot SpartanNash Micro-Fulfillment Center, located at 5199 68th St. SE in Caledonia, Mich., on July 26. Personal shoppers at the stand-alone facility will process Fast Lane pickup and delivery orders for 24 Ada Fresh Market, D&W Fresh Market, Family Fare and Forest Hills Foods stores across West Michigan, mainly in the Grand Rapids and Holland area.

“Fast Lane has been a tremendous value-add for our store guests as the pandemic heightened the importance of safe, efficient grocery shopping, pickup and delivery,” SpartanNash President and CEO Tony Sarsam said in a statement. “The micro-fulfillment center is an exciting investment designed to further elevate the Fast Lane shopping experience as we strive to continuously improve our fulfillment speed and product availability.”

The 55,000-square-foot, freestanding facility will process Fast Lane pickup and delivery orders for 24 SpartanNash corporate-run supermarkets in West Michigan.

The micro-fulfillment center (MFC) will carry 16,000 products and pick and pack over 1,000 Fast Lane orders daily when fully operational, more than doubling Fast Lane’s current order volume capacity, according to SpartanNash. Though employing manual rather than automated picking, the new facility stands to boost Fast Lane’s efficiency, expand the product assortment for Fast Lane customers, and free up space and stock in stores, the Grand Rapids-based company said.

Related:SpartanNash sweetens perks for Fast Lane subscribers

Once Fast Lane personal shoppers at the SpartanNash MFC pick and pack an order, it’s delivered directly to a store for curbside pickup or to the customer’s home. SpartanNash noted that its personal shoppers can communicate directly with customers via text messaging to accommodate their preferences in product selection, such as the ripeness of fruit or thickness of steak.

“We look forward to delivering an even higher level of quality and convenience to our store guests than they already enjoy with Fast Lane,” commented Tom Swanson, executive vice president and general manager of corporate retail at SpartanNash. “The technology and design of the MFC will allow us to be three to four times more efficient than fulfilling orders in-store. The new process increases our already great service effectiveness and gives our Fast Lane customers even more variety and assortment, all benefits we’re excited to introduce as a result of the MFC.”

SpartanNash said the micro-fulfillment center will carry 16,000 products and pick and pack over 1,000 Fast Lane orders daily.

SpartanNash noted that the MFC’s grand opening date marks the four-year anniversary of Fast Lane’s debut. Since launching in 2017, the service has processed nearly 1 million orders.

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"There are no other MFCs currently being planned, but we are continuously evaluating our operations and footprint to optimize service to our customers," Adrienne Chance, vice president of communications at SpartanNash, said in an email.

Currently, Fast Lane service is available at 68 SpartanNash-owned and -operated supermarkets in Michigan, Minnesota, Nebraska, North Dakota, South Dakota and Wisconsin under the Family Fare, D&W Fresh Market, Family Fresh Market, VG’s Grocery, Dan’s Supermarket, Forest Hills Foods and Ada Fresh Market banners.

In reporting fiscal 2021 first-quarter results last month, Sarsam noted that online grocery service is part of the “stickiness” of the food-at-home trend that has continued as the COVID-19 pandemic has receded.

“We’re seeing people are still buying more online. So our e-commerce business is still doing very well and continues to grow, even in this period of time when the pandemic is waning,” Sarsam told analysts in a conference call on SpartanNash’s Q1 performance. “So some of the things we did to strengthen our business — the own brands, the improved offering in the fresh part of our business and some other elements like e-commerce — I think all those work together to help keep some of those habits I mentioned a little stickier than we might have forecasted.”

Fast Lane service is available at 68 stores in six states under seven retail banners.

Also in June, SpartanNash expanded benefits for Fast Lane subscribers to incentivize online grocery shopping via its corporate-run supermarkets. SpartanNash stores previously provided Fast Lane subscriptions at $49 per year for free, unlimited curbside pickup, saving users a $4.95-per-order fee. Now under the program, subscribers will receive half-off the delivery fee, an extra $4.95-per-order savings. Other new perks include an exclusive “monthly bonus savings” that provides discounts across store departments.

Since Fast Lane’s launch in July 2017, which started with click-and-collect at selected Family Fare stores, SpartanNash has added a range of features to the online grocery service, including home delivery, same-day order fulfillment, GPS location technology and instant “clipping” of digital coupons.

*EDITOR'S NOTE: Article updated with more information about the SpartanNash Micro-Fulfillment Center's operations.