February 2002

The service will initially be offered from selected stores in Portland, Oregon in the north-west of the country, and will be based on deliveries from stores. Tesco.com chief executive John Browett told e.logistics Magazine that eventually the service would be rolled out to all Safeway stores, covering about 60 per cent of the US population - with particular emphasis on the west coast of the country.

According to Browett: "Our research has shown that customers in the US want the same from their home shopping service as their British counterparts - low prices, a full range of products and convenience." He added: "Warehouses need a lot of orders if they are to deliver the required level of service. It takes a long time to achieve that, you need a large catchment area and you can have very high delivery costs."

Coverage will be restricted to a 25-minute drive time of the stores involved - which, as Browett points out, gives a much wider area than in congested countries like the UK. There is a $9.99 flat delivery charge.

Last year Tesco.com took a stake in GroceryWorks, in which Safeway is now the majority shareholder. The new service will be branded as Safeway.com.

Tesco.com is the world's largest online grocery retailer with over 1 million registered users and a weekly volume of over 70,000 orders. Tesco.com is on target to achieve a turnover of over £300 million. It also operates an Internet grocery home shopping service in the Republic of Ireland, and will start a similar venture in South Korea "some time this year". This will eventually cover 70 to 80 per cent of the country's population. Tesco also has stores in Central Europe, Thailand and, form this year onwards, Malaysia, but it these markets will have to wait a little while longer for a home delivery option.