Online grocery retailer Farmstead is entering the Carolinas through a partnership with Alex Lee, the parent company of Lowes Foods. This marks Farmstead’s first foray outside the San Francisco Bay Area, as well as the company’s initial step in a planned nationwide expansion.
Farmstead will open multiple delivery “microhubs” in both North and South Carolina to ease its entry in the area. The microhubs can be constructed in eight weeks for approximately $100,000, making them significantly cheaper than traditional grocery stores. Each facility can serve a 50-mile delivery radius.
“When we learned about Farmstead’s microhub approach, we recognized it would be a great model for expanding into new geographies where we don’t have physical stores,” said Kimberly George, VP, Communications and Corporate Citizenship at Alex Lee in a statement. “This partnership will help improve the reach of Alex Lee in the Carolinas, and boost revenue with little risk. We’re excited to be the first to partner with Farmstead on this innovative approach to grocery.”
Farmstead, which doesn’t charge stockouts or delivery fees, carries a selection of local and national brands as well as fresh meat, dairy and produce. Alex Lee’s subsidiaries will provide the inventory and local knowledge necessary to design its North and South Carolina product offerings.