Online-grocery service ends

Online-grocery service ends

Oct. 7, 2000

Journal and Wire reports

The company that operates King Soopers’ and City Market’s online discount service in Denver is shutting down the service just weeks after it opened.

Cincinnati-based Kroger Co., which owns the King Soopers and City Market grocery chains, rolled out the partnership with WebHouse Club on Sept. 21. The service allowed customers to buy brand-name kitchen staples as well as ham, milk and eggs, at reduced prices through a bidding process.

Officials with Greenwich, Conn.-based WebHouse Club said the service shaved about $10 off an average $35 grocery bill. But WebHouse Club, an independent licensee of Priceline.com, announced Thursday that it will shut down in the next 90 days because of cash-flow problems.

That means the company is also pulling the plug on the discount grocery service.

Jim Berhost, manager of the Cortez City Market, said that he was disappointed about the service shutting down only a few days after the statewide kickoff. "We had just run out of the (Priceline Webhouse) cards," Berhost said Friday.

"With the capital market the way it is, senior management decided it was very difficult to raise enough capital to complete our business plan," Priceline WebHouse spokesman Robert Padgett said.

Officials from King Soopers, which still offers Internet shopping, declined comment Thursday and referred questions to Priceline WebHouse. King Soopers said on its Web site that it would stop honoring Priceline WebHouse cards immediately.

Through Priceline WebHouse, users bid on the prices of products within 240 categories. If bids were successful, the user’s credit card was charged and users picked up the order at King Soopers.

Padgett said all customers will receive full refunds by Oct. 20. The amount will be equal to the bid price plus the estimated savings and will be credited to users’ credit cards.

"I think the grocers looked at this as a service they could offer that didn’t really cost them anything so why not do it," Deutsche Bank analyst Jonathan Ziegler said. "I’m amazed it lasted this long, considering you’ve got to be absolutely desperate to save money to shop this way on a regular basis."