Walmart Buys Logistics Startup to Enable Same-Day Delivery in New York

The discount retailer, locked in a fierce battle with Amazon.com (AMZN) to shorten the time it takes to get customers’ packages to their homes, last week acquired Parcel for an undisclosed amount “smaller than previous acquisitions” Walmart has made this year ( which include Bonobos, Moosejaw, and Modcloth), the company said in a blog. Recodereported the acquisition price was less than $10 million, citing sources. Target (TGT) in August made a similar acquisition, buying Grand Junction, a San Francisco-based startup that connects retailers and other distributors to a network of more than 700 carriers across North America to enable same-day delivery.

“We plan to leverage Parcel for last mile delivery to customers in New York City—including same-day delivery—for both general merchandise as well as fresh and frozen groceries from Walmart and Jet,” the company said in a blog, referring also to e-commerce retailer Jet.com which it bought last year for $3.3 billion.

Parcel’s customers include Bonobos and meal-kit services like Chef’d and Martha Stewart’s Martha & Marley Spoon, and will continue to serve current clients, Walmart said. Founded in 2013, Parcel is a so-called “last-mile” delivery platform that operates around the clock and delivers in as quickly as two-hour windows.

The move comes just weeks after Amazon.com completed its acquisition of Whole Foods, which has a large presence in New York City and will likely help Amazon accelerate grocery delivery. And Walmart, whose e-commerce grew 63% last quarter, is looking to keep pace with Amazon, whose Prime members can get free two-hour delivery on a limited assortment of goods, as well as same-day delivery for free on many items.

What’s more, same-day delivery is a way for Walmart to get more business from New York City customers, a market of 8.5 million people that doesn’t have a single Walmart location.