The new supermarket concept Addie’s, a self-described “drive-up grocer,” has opened its first store in Norwood, Mass., fueled by $10.1 million in seed funding it recently received from Rose Park Advisors.
The pickup-only store does not allow in-store shopping; instead, the store serves as an onsite warehouse designed solely for stocking, storing and bagging groceries. As such, the store itself features a “completely reimagined” layout and inventory management system developed to enable “accurate and affordable grocery pickup in minutes.”
Consumers purchase groceries through the Addie’s app or website and then choose a pickup window. The parking lot of the store is also designed to allow for a convenient drive-up experience.
At 22,000 square feet, this first Addie’s store stocks a wide selection of national brands and local favorites that will be regularly updated based on customer searches and requests.
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The company claims that the model allows it to save resources and money, enabling higher starting wages for store employees ($20 per hour), while maintaining competitive pricing and using just one quarter of the energy required of regular supermarkets.
“We believe that taking better care of busy families should be done in a way that also takes care of our team, our community and our planet,” said Jim McQuade, Co-founder and CEO of Addie’s in a statement. “With our seed funding, we’ve built an end-to-end experience to serve people in and around Norwood in a way that can be replicated in suburbs nationwide. We look forward to quickly expanding, offering busy families across the country drive-up grocery convenience without compromise.”
The pandemic served as a propellent for online grocery, and many consumers aren’t returning to traditional in-store shopping: online grocery is expected to account for 20.5% of all U.S. grocery sales by 2026, according to Mercatus. But both traditional grocers and other startup models such as rapid delivery companies have struggled to find financially viable ways to serve this growing consumer set. Delivery-only options have had difficulty scaling beyond population-dense urban environments, and curbside pickup or BOPIS offerings out of traditional supermarkets have faced challenges with consistency and profitability.
“The 100-year-old grocery business is not immune to disruption,” said Matt Christensen, CEO and Managing Partner at Rose Park Advisors in a statement. “The traditional business model of in-store shopping makes serving convenience-focused shoppers highly challenging. We see disruptive potential in Addie’s technology-powered drive-up grocery model and are excited to support them as they launch.”
