Of Course Self-Driving Vans Are Now Delivering Groceries in the Bay Area

Bay Area users of Farmstead are already shopping for their groceries in a fairly futuristic way, through an online-only market. Since September, some test users have been receiving their deliveries in high Silicon Valley fashion as well: Dropped off by autonomous vehicles.

It works like this: Opt-in Farmstead customers, mostly in Burlingame at the moment, receive a message during an hour-long window, letting them know an orange and black delivery van has arrived with their haul. They approach the vehicle (which has a human co-pilot, per current California law), tap a button, and one of the vehicle’s 18 insulated compartments opens automatically to reveal their groceries. Ta-da.

Farmstead announced the pilot partnership with Udelv, a Carson, California-based autonomous van company, this week at Grocery Shop, a new grocery technology conference held for the first time in Las Vegas.

“Our two models can work well together,” says Udelv director of business development Adriel Lubarsky. “When you talk about the cost of last mile delivery, it’s so high for grocery stores, and autonomous vehicles can bring that down.”

Udelv vans in the Bay Area have made 800 deliveries so far, some for Farmstead, but most for other grocers like popular peninsula market Draeger’s. Only two test vans are rolling at the moment, but a fleet of 100 is in production for 2019.

Famstead’s current delivery model relies on human drivers to shuttle goods from its distributed warehouses to customers. The startup’s goal is to cut costs by eliminating physical stores and preening unnecessary inventory by tracking customer habits through advanced software.

“The system stops buying things that aren’t moving,” says Farmstead CEO Pradeep Elankumaran “and our food waste numbers are declining.”

As of now, Farmstead deliveries arrive on doorsteps in what’s known as unattended delivery. But in dense, city markets, tightly-timed autonomous delivery — right to customers hands — could be more popular.

Farmstead, Udelv, and presumably every other attendee of the Grocery Shop conference is desperately taking aim at food and delivery giants like Amazon/Whole Foods. But according to Elankumaran, it’s liberating to take a different approach.

“At first, we thought maybe we’d look like Whole Foods, selling lots of organics…. But we don’t have to be Whole Foods.”

Responding to consumer demand, Farmstead has also stocked more conventional products and items at lower price points.

“We don’t have to fall into these buckets or silos [of Whole Foods or Safeway]... We can have a malleable message to our customer, focused on what’s good and getting it to your table as fast as possible.”