During the coronavirus outbreak, we have a surprising report of an acquisition. The news is from Costco which has revealed that logistics firm Innovel has now been acquired by them. The company has spent $1 billion to acquire this company and leverage its logistics and delivery for the e-commerce platform. It is also known that Innovel had been the last-mile delivery partner for Sears for “decades”. Now, it will become the last-mile delivery partner for Costco.
Apart from last-mile delivery, Innovel has also been doing delivery of “big and bulky products, along with installation and “white glove” support services, across the United States and Puerto Rico”. Innovel delivered products such as “major appliances, furniture, mattresses, televisions, grills, patio, fitness equipment and wine cellars”. Costco CEO says that “We have had a great relationship with Innovel and share a philosophy of taking care of our members”. “We believe the acquisition will allow us to grow our e-commerce sales of big and bulky items at a faster rate.”
It is clear that Costco wants to deliver big products to people’s home rather than the need for them to pick those items for the store. This is obvious that Costco has seen data which reveals the trend of people shopping for products such as furniture, heavy appliances and others online as well.
As per Innovel’s website, it can reach 100% of continental U.S. ZIP codes, plus Anchorage, Alaska, and Oahu, Hawaii. The company said it offers a 24- to 48-hour delivery capability for 85% of households and 93% of orders and makes more than 4 million deliveries per year, with 1,100 trucks on the road daily.
Apart from Innovel covering 90% of the US and Puerto Rico deliveries, it is also ranked among the top when it comes to customer satisfaction which is also the reason why Costco decided to acquire it.