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None of the costs you mentioned relate directly to a customer's choice at checkout in the way a credit card does. If the supermarket provided a "home delivery"

None of the costs you mentioned relate directly to a customer's choice at checkout in the way a credit card does. If the supermarket provided a "home delivery" service it would be absurd to expect them to amortize it over everyone who doesn't use home delivery so I could get it for "free".

chrismorgan 6y ago
You say it’s absurd, but that’s exactly what happens. In Australia, the two biggest supermarkets, Woolworths and Coles, do provide free delivery if you buy more than $300 and $200 (respectively), with Woolworths’ delivery fee going down by $3 for every full $50 you spend after $50. So yes, they’ve masked the fact that everyone’s subsidising delivery by only offering it to you when you’ve bought a whole lot of stuff from them, but if you’re buying online at the same prices as you’d get in-store (I confess this is the weak spot in my argument, I don’t actually know for sure that prices are the same, I’ve never bought from a supermarket online), everyone is subsidising the deliveries, even if the threshold has made it a smaller subsidy. Edit: on reflection, I guess it’s also possible that the fees from the small deliveries are sufficient to fully subsidise the bigger deliveries, and that regular shoppers aren’t subsidising anything. But this wouldn’t hold for any businesses that offer unconditional “free shipping” while also allowing you to pick up or buy in-store. Edit: it is also possible that it may not need a subsidy at all. You view delivery as the luxury, but remember that stores cost money too. There's a reason some stores have gone online-only or online-primarily.
- StavrosK 6y ago
  I don't think everyone is subsidizing the deliveries in this case, they just make enough profit from you to figure that bringing you groceries home is profitable even after the cost (because you're inclined to shop with them more often).

chrismorgan 6y ago

You say it’s absurd, but that’s exactly what happens. In Australia, the two biggest supermarkets, Woolworths and Coles, do provide free delivery if you buy more than $300 and $200 (respectively), with Woolworths’ delivery fee going down by $3 for every full $50 you spend after $50. So yes, they’ve masked the fact that everyone’s subsidising delivery by only offering it to you when you’ve bought a whole lot of stuff from them, but if you’re buying online at the same prices as you’d get in-store (I confess this is the weak spot in my argument, I don’t actually know for sure that prices are the same, I’ve never bought from a supermarket online), everyone is subsidising the deliveries, even if the threshold has made it a smaller subsidy. Edit: on reflection, I guess it’s also possible that the fees from the small deliveries are sufficient to fully subsidise the bigger deliveries, and that regular shoppers aren’t subsidising anything. But this wouldn’t hold for any businesses that offer unconditional “free shipping” while also allowing you to pick up or buy in-store. Edit: it is also possible that it may not need a subsidy at all. You view delivery as the luxury, but remember that stores cost money too. There's a reason some stores have gone online-only or online-primarily.

StavrosK 6y ago
I don't think everyone is subsidizing the deliveries in this case, they just make enough profit from you to figure that bringing you groceries home is profitable even after the cost (because you're inclined to shop with them more often).