The cost of living in the U.S. has increased dramatically over the last few decades, and the lower and middle classes feel it most sharply in the price of groceries.
Instacart has at least made the act of obtaining groceries more convenient, but never more affordable. Delivery and service fees abound, but what about the food prices? Does Instacart markup prices on groceries? Here is what you need to know!
Does Instacart Markup Prices In 2023?
Instacart itself does not mark up prices on groceries; rather, individual retailers set their own prices, with many choosing to upcharge up to 15 percent of normal in-store prices to help offset the costs of partnering with Instacart. However, Instacart does add to the shopping cart total with delivery fees and service fees in 2023.
To learn more about the markups on Instacart, how much Instacart charges for its services, whether you can find in-store sales on the app, and even why Instacart upcharges temporarily on the total, keep reading! I have all you need to know!
How Much Is the Markup on Instacart?
Instacart claimed in 2016 that the markup on items on its app came to about 15 percent, though Supermarket News reports that it can be as much as 23 percent.
Why the markups? First of all, not all retailers on Instacart inflate their prices. The ones that don’t are actually special partners with Instacart.
The ones that do have no special arrangement or agreement; have simply signed on to use the platform to reach Instacart’s wide customer base.
Without explicitly saying so, it may be a bit more expensive for retailers to sell on Instacart as a non-partner.
Therefore, they would be the ones more likely to upcharge in order to offset the costs of working with Instacart.
Yes, that’s right – the retailers themselves set the upcharges, not Instacart.
Some mark up prices generally – you can expect pretty much every item on their Instacart marketplace to be more expensive than in-store.
One example of that is the mid-Atlantic chain Wegmans.
But others, like the national chain Aldi, only markup prices on select items. You might pay more for frozen green beans, but their Aldi Finds are almost always the same price as in-store.
You can learn which retailers abide by which pricing policies by visiting their individual Instacart storefronts.
Under their logos at the top of the screen, there is a link that reads “View pricing policy,” “Higher than in-store prices,” or “Everyday store prices.”
The first is for retailers who upcharge some items but not all; the second is for retailers who charge higher prices all-around, and the last is for retailers with no markup.
Does Instacart Add Cost to Items?
Instacart doesn’t mark up prices, but it does add charges that drive up the cost of using the service.
The most obvious is delivery fees, which can range from $3.99, all the way up to $9.99 in some markets.
The base $3.99 fee can be marked up by $2-4 if you want priority (faster) delivery.
Then there are service fees, which apply only to delivery orders. There are a number of different service fees, like heavy item charge, alcohol charge, even bagging fees.
All this together tends to account for about five percent of your order total.
So, the bigger/more expensive your order, the higher the service fees.
Then there is also the tip for your shopper.
Are tips absolutely mandatory for Instacart delivery? No.
That said, shoppers can see the tip being offered before they accept an order (or “batch” as they call them).
So, a big grocery order with a fair distance between the store and the address for delivery and no tip is not going to be a popular order.
If you’re going to use Instacart, it’s important that you can also afford to tip your shoppers well.
The minimum Instacart suggests is $2, but $5 is much more reasonable, and that’s the bare minimum. Those who can afford it absolutely should consider tipping 15-25 percent.
Do You Get Store Sale Prices with Instacart?
Some retailers run some of their in-store promotions on Instacart and some do not.
For example, the Tops Friendly Markets in some neighborhoods are usually quite good about putting sales on Coke products and deals on frozen meals on Instacart.
But what you will not see (a lot or any of) are those location-specific in-store mark-downs.
Why Does Instacart Charge More Than the Total?
We’ve all seen the message: “Your card will be temporarily authorized for $XX…” at checkout.
If the order comes to $65, that amount might be something like $75 or $80.
Why does Instacart do this?
This can happen a lot with meat and produce especially.
Does Instacart Take Coupons?
Instacart does not accept manufacturer’s coupons and offers no way of inputting them in the app or on the website.
Instead, Instacart occasionally runs deals and specials, or retailers themselves might run sales or deals.
One of my favorite promotions that Instacart has run is where customers get two percent back on pick-up orders.
It appears as credit on their account, and can be used with the next order or saved up to accumulate.
Instacart itself does not markup prices, but rather retailers who are not specially partnered with the company may do so to offset operational costs.
This can range anywhere from 15 to 23 percent of the usual in-store prices, on top of delivery and service fees (and tips!).