Dive Brief:

• Food Rocket, an ultrafast grocery delivery service backed by Circle K parent company Alimentation Couche-Tard, has launched delivery at two of the retailer’s c-stores in Charlotte, North Carolina, according to an emailed announcement.
• Through its app, Food Rocket will offer up to 7,000 SKUs, with a focus on grocery and convenience products. Orders will be delivered in around 10 minutes from two micro-fulfillment centers of between 170 and 500 square feet at Circle K’s stores at 8505 S. Tryon St. and 8008 Harris Station Blvd.
• Food Rocket’s expansion comes as other ultrafast delivery firms have struggled to expand in the U.S., and high operating costs and intense competition have caused many to burn through their investment capital.

Dive Insight:

Launching delivery with Circle K is the latest event in a busy handful of months for San Francisco-based Food Rocket, which raised $25 million in funding led by Couche-Tard in April. At the time of the funding, Food Rocket said it would work with Circle K to expand its e-commerce and delivery channels. 

Weeks later, Food Rocket disclosed plans to open a fulfillment center in Chicago co-located with a new Circle K convenience store and offer 15-minute delivery of products sold by both companies. In June, Food Rocket tapped Couche-Tard’s VP and controller, Guillaume Leger, to join its board of directors.

Now, Food Rocket will offer Circle K’s breakfast sandwiches, tacos, burgers, pizza, coffee, snacks and more — in addition to its own proprietary food and beverage items — for delivery. The launch will also create 100 new jobs in Charlotte, according to the announcement. 

When asked why Food Rocket picked Charlotte to launch delivery with Circle K, CEO Vitaly Alexandrov noted in an interview that many of the retailer’s U.S. executives reside in the area, which will make the launch smoother. 

Beyond that, he said Food Rocket was looking for a low-density area because it’s in the early stages of rolling out its “urban” concept, which features delivery via cars instead of e-bikes, which are commonly used in high-density regions like Chicago, where Food Rocket began operating in February, and in San Francisco.

Alexandrov did not specify when or where Food Rocket will roll out delivery with Circle K moving forward — only that it’s a work in progress.

“We are waiting, trying to make it sustainable in Charlotte,” he said. “And once we’ve realized that we're achieving all the metrics, we’ll go further.”

Food Rocket’s business model is based on AI-enabled technologies to manage assortment, forecast demand and optimize delivery time by finding the dark store that offers the shortest delivery time and the lowest costs of building and delivering the order. It takes about 2-3 minutes to process each order, with delivery taking around 10 minutes. Food Rocket guarantees delivery within a specific time frame shown in the app, or it will be free. 

Kevin Lewis, chief marketing officer for Couche-Tard, said in the announcement that Food Rocket’s “unique approach to quick delivery and a differentiated platform” has the potential to be a powerful engine for convenience.

“We’re looking forward to seeing how this pilot in Charlotte resonates with our customers,” he said.